BOS refine recently proposed cannabis regulations
During the introduction of the proposed regulations on marijuana the county seeks to put in place, the County Board of Supervisors voted Tuesday to refine the restrictions that will be adopted for the cannabis industry.
The board made seven different decision which ranges from permitting, personal cultivation, industrial hemp, allowing delivery services for adult use, when proposed taxes could be taken to the voters, the type of taxes they want to put in place and when the to be crafted ordinances will take effect.
Among the decisions made, the board opted to implement a general tax on the industry which will need to go to the voters to be approved rather than an excise tax that would enable officials to earmark the tax revenue for specific functions, however, District 2 Supervisor Luis Plancarte who led the ad hoc committee reviewing the matter said the committee felt it would be difficult to get the necessary two-thirds majority necessary for that to move forward.
Also, he noted that the excise tax would have to take place as a special election in November which would result in the country having to pay for the additional expenses and also there is a concern about the potential of a low voter turnout.
Another recommendation made by the committee which went in hand to the general tax question was to have a temporary hold on the permitting of cannabis and make it contingent on the results of the voter’s decision on adopting the additional taxes at the county level, but District 4 Supervisor Ryan Kelley disagreed with that option.
“There are entities that are looking to develop in Imperial County, that means investment, employment and that is what we are about,” he said. “I believe that we should move the pieces in place for Jan. 1 and allow them to go through the permitting process and be able to make their developments, as the taxes are either approved or denied then its applied evenly across the board. I don’t think we should put everything hinging on how we are going to make money out of this.”
Ultimately the board decided to move forward with drafting a cannabis tax measure to take to the voters in November and also allow the interested investors to start the process starting Jan. 1.
Another key recommendation brought forward by the ad hoc committee is how the county will seek to tax the industry. With the approval of Prop 64, last November the state claimed the first piece of the cake by setting a 15 percent excise tax on the sale of marijuana and allowing local jurisdictions to implement further taxes.
The proposed taxes brought forward include an 8 percent tax on retail sales, a 5 percent tax on the gross revenue in manufacturing and also suggested to set a three level land tax for cultivation facilities to be set at $15 per square feet starting Jan. 1, then the tax would rise to $20 by 2020 and $25 by 2022.
“The big concern we had was ‘how do we get some funding but avoid going too far that will push sales to the alley?’” Plancarte said.
In order to sort out that issue, the ad hoc committee looked for a way to avoid having the end users carry the burden of all the taxes placed on marijuana and set a retail tax at a similar level than the sales tax. The recommendation was approved unanimously.
Although a majority of the board has expressed discomfort with the idea of allowing the recreational use of cannabis in the county’s jurisdiction, during the June 6 meeting the board gave direction to staff to draft an ordinance to allow one medical marijuana facility and one non-store front facility for recreational use that would be used only for delivery service out of that building, but agreed to permit up to five delivery operations.
On Tuesday the board considered that due to the impracticality of having one building to run five different services, the board also voted in favor of allowing up to five ‘virtual’ recreational dispensaries that would not have a store front and will run delivery services exclusively and voted unanimously in favor of it.
The rest of the decision made on Tuesday include the Agricultural Commissioner’s office to take charge of the industrial hemp part of the equation, require standards in place at the county to remain the same for the manufacturing, cultivating and processing of cannabis and to keep in place the state regulation of allowing up to six marijuana plants to be allowed to be cultivated indoors and not require residents to get a building permit to do so. The board had previously given direction to ban outdoor cultivation in the unincorporated areas of the county.
The ordinances laying out the regulatory framework for marijuana are expected to be brought back to the board for a reading in the near future in order to officially set the ordinances in place.