Long Beach officials released an analysis Monday of what would happen if the ballot measure to set taxes on marijuana is approved Nov. 8 by voters.
Last month, the City Council unanimously approved Measure MA for the November election. That proposal sets tax rates for both medical marijuana and recreational marijuana, should either or both get passed in the same election.
Under Measure MA, medical marijuana would be taxed at retail dispensaries at 6% to 8% of gross receipts, starting at 6%. If recreational marijuana sales are approved (state Proposition 64), those sales would be taxed at 8-12%, starting at 8%. Distribution and other wholesale activities would be taxed at 6-8% of gross receipts, starting at 6%. Finally, cultivation would be taxed at $12-$15 a square foot, starting at $12.
This is strictly a tax measure, Mayor Robert Garcia said at a Monday press conference. This says nothing about approving marijuana sales.
Sales are addressed by two other ballot issues – a Long Beach measure to allow and regulate medical marijuana dispensaries (Measure MM) and a state measure to legalize sale and use of recreational marijuana (Prop. 64).
Measure MM was placed on the ballot via petition, with more than 35,000 signatures, after failure of several attempts by the City Council to pass an ordinance regulating dispensaries. The more liberal residents petition would allow 26 to 32 dispensaries to locate anywhere except residential areas in the city, with some regulation.
That measure also addresses taxation language. Under MM, the city could not charge regulatory fees for the recovery of application, regulation and enforcement costs. It also reduces the medical marijuana tax rates already approved by Long Beach voters in 2014 (up to 10% of gross income), and would eliminate taxes on recreational marijuana.
If Measure MM passes, the citys Measure MA would have to receive more yes votes than MM for the city tax rates to be imposed. If Measure MM fails, MA would be mute. If MM passes but Prop. 64 fails, and MA has more votes than MM, only the medical marijuana taxes would apply.
Assistant City Manager Tom Modica said at the press conference that the city has estimated it will cost about $12 million to regulate marijuana dispensaries if either medical or recreational (or both) is approved. Under MA, it is estimated that about $13 million would be generated if both medical and recreational marijuana is being sold; less if the recreational marijuana proposal fails.
But if Measure MM gets more votes than Measure MA, there will be a shortfall of about $5.1 million in revenue, Modica said. The city would have to make up the difference through the general fund.
There are two primary costs if marijuana sales are approved. The first is regulation of the businesses, including everything from business licenses to testing for quality. The second is police enforcement.
Police Chief Robert Luna said Monday that one of the biggest concerns is people driving under the influence of marijuana. Another is use by minors.
There definitely would be an increase in our workload, Luna said. That means we need resources. The impaired driving is the biggest issue and the kids are going to see the adults and say, Theyre doing it. Lets go smoke some weed.
Garcia said he and Chief Luna, along with Fire Chief Mike DuRee, are writing the ballot argument in favor of Measure MA. He said Mondays press conference and the material distributed there had been verified as offering information as opposed to campaigning. It is illegal to use city resources to campaign for a ballot issue.
News Moderator: Katelyn Baker
Full Article: Long Beach Officials Make Case For Marijuana Tax
Author: Harry Saltzgaver
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