Pacific Grove City Council Regular Meeting – March 4, 2026

The Pacific Grove City Council held a regular meeting on Wednesday, March 4, 2026, at 6:00 p.m. in council chambers at 300 Fourth Avenue. The agenda included a presentation, announcements, public comment, a consent agenda, and discussion items on cannabis licensing, budget modifications, the city work plan, and a presentation from Monterey One Water.

Consent Calendar

• The council approved the consent agenda (excluding item 8A) unanimously. Items included routine approvals and staff reports.

Public Comments & Testimony

• Peggy Gibbs (CEO/co-founder of PG Cares) reported on the Keep America Beautiful National Summit, highlighting the impact of volunteer efforts and the importance of beautification for community pride and economic vitality. She expressed PG Cares' commitment to working with the city.
• Online commenter (name not given) thanked staff for improving comment letter posting procedures, and asked when the rental assistance program (promised by January 2026 in the housing element, page 320) would come before the council.
• Amara Morrison (attorney, Redwood Public Law, representing Nug Pacific Grove LLC) requested that the council agendize the cannabis memo for full discussion before the March 30 lottery, or postpone the lottery. She argued that eight of the ten eligible applications are interrelated with common ownership, which the city's ordinance defines as relevant, and that the city's process ignores this definition.
• Public comment on Monterey One Water presentation (one speaker opposed the rate increase, citing financial strain; another supported the low-income assistance program).

Discussion Items

• Item 8A – Storefront Retail Cannabis Business Licensing (Informational)

  • City Manager Logan stated the item was informational only, providing a history of staff responses to questions about the permitting process.
  • Councilmember Walkingstick moved to pause the permit award process and agendize an ordinance to prevent application stacking, citing concerns about fairness and that the city's own ordinance does not prohibit stacking. He argued that the council has authority to act on the agenda item.
  • The city attorney ruled the motion improper because the item was agendized as informational only.
  • Councilmember Rao questioned staff about the process, appeals, and FAQs. Deputy City Manager Halby confirmed that the city's ordinance does not restrict multiple applications by related parties, and that FAQs clearly stated this. No appeals were received during the 10-day appeal period in January.
  • Councilmember Garko asked for clarification on how the eight applications are interrelated. Staff noted the alleged interrelationship involves a parent company with applications under individual names, but the city's review found no violation of existing ordinances.
  • Councilmember Moreau argued that applicants followed the rules, invested significant fees (approximately $64,000 in LLC formation costs plus $10,000 per application), and the lottery should proceed. The mayor closed discussion, noting the item was for information only.

• Item 11A – FY 25-26 Mid-Year Budget Modifications

  • Assistant Director Jessica presented the mid-year update. The originally approved budget projected a $1.9 million operating deficit. Proposed amendments increase revenue by $700,000 (higher property taxes: +$200,000; higher transient occupancy tax: +$500,000, including conservative projections for the Kimpton Hotel) and increase expenditures by $294,000 (Monterey Fire contract true-up, elevator repairs at the youth center). The revised deficit is approximately $1.5 million. The city still meets the 25% general fund reserve requirement.
  • Staff also proposed reclassifying an associate planner to senior planner with no net cost increase.
  • Council commended staff for conservative budgeting. A motion to introduce the ordinance for first reading passed unanimously.

• Item 12A – Status Update and Review of Work Plan

  • City Manager Logan presented a detailed update on the two-year work plan: 9 of 27 supporting tasks are complete. Highlights included progress on fiscal sustainability (risk management assessment, fee review), infrastructure (CIP, sidewalk policy, asset database, IT system RFP), and community development (ADU ordinance, affordable housing, water allocation evaluation).
  • Councilmember Paduri recognized Deputy City Manager Halby's leadership. Councilmember Garfield suggested aligning BCCs more closely with fiscal sustainability goals. Councilmember Rao emphasized the need for technology improvements. Mayor Smith and others asked about specific projects (Sunset roundabout, Lovers Point pier, Chinese pavilion, parking meter retrofit). Staff replied that roundabout and pier are in the CIP; Chinese pavilion design is funded by $200,000 raised by the Mari Bhinese Association; parking meter retrofit proposal expected in April.
  • The council received the report and offered no further direction.

• Monterey One Water Presentation

  • Executive Officer Paul Shudo presented an overview of Monterey One Water's operations, including its 35-year-old treatment plant, 30 MGD capacity, 60% of potable water demand supplied by Pure Water Monterey expansion (completed October 2025), and a $500 million capital improvement plan over 10 years. He announced a proposed 8% wastewater rate increase (from $54 to $58.32 per month for single-family dwellings) to fund infrastructure renewal. The Proposition 218 process will include a public hearing in June 2026. A low-income customer assistance program has helped 900 customers, but funds ran out for 50 additional applicants.
  • Councilmember Garfield asked about the Coral Street pump station electrical relocation project. Shudo said the city is considering alternative designs to minimize visual impact after community concerns. Councilmember Paduri and others urged continued affordability measures. Councilmember Garko asked about cost drivers and the 218 protest threshold (50%+1 of customers).
  • The council thanked Shudo for the presentation.

Key Outcomes

• Consent agenda approved unanimously (item 8A pulled).
• Cannabis licensing (8A): No action taken; the council heard information and public comment. The lottery remains scheduled for March 30, 2026, at 5:00 p.m.
• Budget modifications (11A): Ordinance introduced and passed first reading unanimously. Final adoption will occur at a future meeting.
• Work plan (12A): Report received; no formal action.
• Monterey One Water presentation: received; no council action.