City Cracks Down On Smoke Shops

The Hayward Planning Commission met on June 11th to decide whether to revoke the Tobacco Retail Licenses from six of the around 100 tobacco retailers in Hayward. The businesses had received more than 3 code violations within the last five years, ranging from out-of-date licenses to hidden compartments filled with illegal goods. The Commission voted to revoke the licenses from all six retailers, many of whom owned thousands of dollars in fines.

Those who were present to defend themselves were predominantly business owners who, they admitted, were rarely watching the store. But city staff pointed out that the business owner is ultimately responsible for the behavior of their employees. Another meeting, later this month, may result in more revocations.

Code Enforcement Action With The State

According to the staff report, the local ordinance governing Tobacco Retail Sales Establishments was established in 2014 in an effort to regulate sales, reduce youth access, and establish a licensing and enforcement framework. In 2020, the ordinance was strengthened to reduce access to flavored tobacco and vaping products, especially to youth, and works in tandem with State law prohibiting flavored tobacco products.

According to the ordinance, the Planning Commission is required to revoke the licenses when there is a preponderance of evidence that a Tobacco Retailer has committed three or more violations within five years. However, according to the staff report, inspection and enforcement was, in the past, not been as effective as it could be. In 2025, the city received a Department of Justice grant which allowed them to centralize inspections under one Code Enforcement Inspector, which has allowed them to better coordinate with state and federal enforcement efforts.

In January of 2026, the California Department of Tax and Fee Administration (CDTFA) conducted an enforcement with the city Inspector, some of which revealed a number of extra violations. These included hidden doors and compartments containing illegal merchandise, ranging from flavored tobacco products, out-of-state menthol cigarettes, and sellable amounts of psilocybin mushrooms.

Of the six retailers, all of them had received between four and eight violations within the last five years. According to city staff, many of the retailers were grandfathered in to the Tobacco Retail Sales Establishment ordinance in 2014, meaning that these practices may have been going on before the ordinance was established.

Public In Favor Of Enforcement

Public speakers, many of whom were students or speaking on behalf of students, supported revoking the licenses from the offending retailers. Members of the Eden Youth Advisory Council were prominent among the speakers, many of whom have also spoken out against cannabis businesses and are pushing for a ban on smoking in multi-family apartment buildings.

Concerns ranged from general concerns about public health to the idea that violating retailers may be selling products to underage buyers. The violations listed in the staff presentation reflects many of the concerns voiced against cannabis retailers, including excessive signage, vaping products, and hemp/CBD products. These offending tobacco retailers outnumber local cannabis retailers by more than 2:1.

Six Tobacco Retailers Under Fire

The six tobacco retailers, marked by blue arrows above, who had their hearings were:

• Mt. Everest Smoke Shop - Concealed storage, selling illegal products, expired/not posted licensing, $4,500 in fines owed
• Heart of the Bay Smoke Shop - expired/not posted licensing, selling illegal products (including cannabis and psilocybin mushrooms), $4,500 in fines owed
• All Star Service Inc. - expired/not posted licensing, selling illegal products
• Hiphop Smoke Shop - Concealed storage, selling illegal products, $1,500 in fines owed
• Stack City Smoke Shop - Concealed storage, selling illegal products, over $18,000 in fines owed
• Stop N' Save #106 - expired/not posted licensing, selling illegal products, over $10,000 in fines owed

A common theme among the retailers who were present was that they were frequently owned by someone who was rarely present in the building. Multiple owners said that day-to-day operations was handled by someone else, whether a business partner, a family member, or a manager. They insisted that they had no idea that anything illegal had happened.

The lawyer with the city and the city Inspector said that the ongoing behavior required enforcement. "The presence of these concealed storage areas, particularly after multiple years of inspections and documented violations, demonstrates that the violations were not isolated or inadvertent," the inspector said. The Planning Commission is required to revoke the licenses if there is good evidence of wrongdoing. However, this just revokes the license and is not a criminal offense.

Neglect All Around

Inspector Jesse Prince, who is in charge of Tobacco Retail License inspections, pointed out that all businesses had received multiple notices of the violations. However, when asked about how notices were distributed, Inspector Prince said that notices are sent to the property owner, who is also liable for issues with their own tenants. He said that notices were often sent to the business owner and delivered by hand to staff, but seemed to hint that this was not always the case.

It's possible that absentee corporate property owners, combined with frequently absent business owners, opened the door to illegal sales. If the business fails to pay a fine, that fine gets added to the property as a Special Assessment, forcing the landlord to pay.

An Obligation To Comply

The Planning Commission was sympathetic to some business owners, but voted to revoke all six licenses. Deputy Development Services Director Christina Morales said, "Regardless of whether they received an infraction or were told about a specific violation, they still have the obligation to comply." The business owner has a responsibility to follow the law, regardless of the circumstances. "It's kind of ignorance of the law is no excuse," Commissioner Jeffery Haman said.

Commissioner Robert Stevens agreed. "If you're going to form a business and operate a business, you're responsible for all operations," he said. Commissioner Vasko Yorgov said, "Taking the step to revoke the license of a business is a major action... I just don't see a way that we can do anything but revoke."

All six businesses had their Tobacco Retail Licenses revoked.

Correction 6/22/26 : The story originally referred to Commissioner "Michael" Stevens, when the correct name is Robert Stevens. We regret the error and it has been corrected.