presents
Voter’s Edge California
Conozca la información antes de votar.
Presentado por
MapLight
League of Women Voters of California Education Fund
November 6, 2018 — Elección General de California

— Cannabis Business Tax —

Local

City of Redwood City
Measure DD - Majority Approval Required

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Resultados electorales

Passing

22,381 votos si (78.69%)

6,060 votos no (21.31%)

Shall the measure funding police patrols, after-school recreation programs and other general city services by imposing a cannabis business tax on all cannabis (marijuana) businesses at an annual rate which shall not exceed 10% of gross receipts of each business, which is expected to generate an estimated $210,000 annually and will be levied until repealed by the voters, requiring annual audits and with all funds staying in Redwood City, be adopted?

Análisis del analista legislativo / Proposal

The City Council of Redwood City voted 7-0 to place Measure DD on the ballot. The Measure would establish a business tax on cannabis businesses for general city purposes.

Medical cannabis use has been legal in California since 1996 and adult recreational use by persons 21 or older became legal in California in November 2016. In 2017, the State of California enacted a comprehensive state law and emergency regulations convering cannabis cultivation, sale, and use. These state rules include a variety of licensing, operation, and business location requirements for commercial cannabis businesses. On January 1, 2018, the state began issuing licenses for businesses from which adults 21 or older could purchase cannabis.

Based on actions taken by the City Council in 2017 and 2018, City law now allows the following business activities in Redwood City:

 * commercial cannabis delivery centers, with storage and sale by delivery only

 * indoor cannabis nurseries with commercial sales only

 * deliveries by cannabis retailers located outside Redwood City. Walk-in retail sales remain prohibited in the City.

City code currently imposes a variety of business license taxes that vary depending on the types of businesses operating in Redwood City. This measure would impose a business tax specifically on cannabis businesses, based on gross receipts. The proposed tax is not a sales tax on cannabis consumers. The proposed tax is seperate from the permit fees imposed on cannabis businesses in the City which do not require voter approval.

The initial rates would be:

 * 2.5% of gross receipts for Cannabis Nursery Businesses

 * 4.0% of gross receipts for Delivery-Only Cannabis Retail Sales; this applies to all cannabis retailers operating in the City regardless of whether their business is located in the City

In addition, the measure specifies tax rates for cannabis businesses that are not currently allowed in Redwood City, if the activities are authorized at a later date. The rates would be:

 * 1.0% of gross receipts for testing

 * 2.0% of gross receipts for distribution

 * 2.5% of gross receipts for cultivation other than in a nursery

 * 4.0% of gross receipts for retail walk-in sales

 *2.5% of gross receipts for any other type of cannabis business

The measure allows the City Council by resolution or ordinance to adjust these tax rates up or down to a maximum rate of 10% of gross receipts. This allows the City to tailor the rates to different businesses within the supply chain that have different profit margins and levels of competition, while ensuring the tax rate does not make the City noncompetitive.

All funds generated by the measure would be placed in the City's General Fund to be used for any valid governmental purpose. The measure is estimated to generate $210,000 annually.

A simple majority is needed for adoption (50% plus 1). The measure if enacted stays in effect unless and until changed by the voters. 

— Veronica Ramirez, City Attorney

Argumento A FAVOR

Vote Yes on DD to ensure that Redwood City receives a fair share of tax revenue from local marijuana businesses operating within the City.

Measure DD will not cost local homeowners or residents one penny.

Measure DD does not authorize new marijuana dispensaries or businesses in our community. It simply allows our community to benefit from a fair and reasonable local tax structure on this quickly growing industry.

California voters approved Proposition 64 in 2016 legalizing the sale and use of recreational marijuana and imposing state taxes on the production and sale of marijuana. However, all revenue from those taxes goes directly to the State and nothing is distributed directly to the local level.

Measure DD is the ony way to give Redwood City residents local control over local funding from local cannabis businesses.

Measure DD provides financial resources to regulate and oversee marijuana businesses without taking money away from existing programs. This regulatory oversight is improtant to ensure that marijuana businesses operate in safe, legal manner and do not negatively impact our quality of life.

All funds generated by Measure DD must stay here in Redwood City to support local programs and services. The State can't take one penny.

While the initial revenue generated by Measure Dd will be modest, it sets up a fair and well-thought out mechanism to secure local funding from a rapidly expanding industry on an annual basis. This funding can only support essential city services in Redwood City.

Several other cities have adopted similar taxes to benefit from marijuana sales in their communities. That revenue has helped ensure that the necessary resources are available to combat potential negative consequences of marijuana legalization.

Please join Redwood City's leaders in voting Yes on DD: the smart, common sense choice to regulate the local cannabis industry and protect our quality of life.

 

/s/ Janet Borgens, City Councilmember

/s/ Ian Bain, Mayor

/s/ Alicia Aguirre, City Councilmember

/s/ Shelly Masur, City Councilmember 

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