Pubdate: Wed, 25 Jun 2014
Source: Prince George Citizen (CN BC)
Copyright: 2014 Prince George Citizen
Contact:  http://www.princegeorgecitizen.com/
Details: http://www.mapinc.org/media/350
Author: James Keller
Page: 4
Bookmark: http://www.mapinc.org/mmjcn.htm (Cannabis - Medicinal - Canada)

B.C. PREVENTS COMMERCIAL MARIJUANA GROW-OPS FROM GETTING FARM TAX BREAK

VANCOUVER - Medical marijuana producers setting up shop in British 
Columbia won't be able to claim a lucrative property tax break 
designed for farms and other agricultural operations, the provincial 
government said Tuesday.

Mayors in B.C. have been warning for months that commercial grow-ops 
could get out of paying nearly 90 per cent of their property taxes if 
they're lumped together with farms, even if they're operating on 
expensive industrial land.

The province's agriculture minister, Norm Letnick, said medical 
marijuana facilities are complex industrial operations - and that's 
how they'll be taxed.

"Local governments are concerned - and fairly so - that there might 
be some extra costs associated with these facilities," Letnick said 
in an interview. "We're talking about a federally regulated narcotic, 
so it's different than growing mushrooms or cherries or tomatoes in a 
greenhouse."

The debate over how to tax medical marijuana operations is happening 
as governments across the country figure out how to deal with an 
expected influx of such facilities.

New federal rules took effect in April that shift marijuana 
production to licensed commercial producers, rather than patients, 
who were previously allowed to grow their own. An ongoing court case 
has meant that some patients are still growing at home, but the 
commercial system has proceeded.

Health Canada has approved 13 producers, including five in B.C., 
though many more are expected to join them. There is no cap on the 
number of commercial growers and Health Canada is currently reviewing 
hundreds of applications.

B.C.'s property tax rules set rates based on a list of factors, 
including how the land is being used. Agricultural rates are up to 
87.5 per cent lower than other tax categories.

Some mayors were concerned that allowing medical marijuana operations 
in industrial areas to claim the farm credit would downgrade the 
value of land that is taxed at a much higher rate.

For example, Maple Ridge Mayor Ernie Daykin said a piece of land that 
would normally generate more than $30,000 in property taxes could be 
worth just a few hundred dollars if it was considered a farm.

"It's going to be a pharmaceutical, industrial application," said Daykin.

"It [Tuesday's announcement] will allay the fears of a number of 
municipalities that could have seen a significant hit on the taxes 
they could collect on a valuable piece of property."

At the same time, the province also confirmed marijuana production 
would be considered a "farm use" within the Agricultural Land 
Reserve, 4.7 million hectares of protected farmland located across 
the province.

James Poelzer of Agrima Botanicals, a medical marijuana operation in 
Maple Ridge that's close to receiving final approval, said it doesn't 
make sense to consider marijuana production farming in one context 
but not in another.

"I don't really know how much closer you can get to farming or 
agriculture than growing plants," he said.

"We're not doing anything to try and exploit or avoid taxes. What 
we're doing is growing plants - that's our sole business."

Agrima Botanicals' facility is located within the Agricultural Land 
Reserve, though Poelzer said the company is currently paying 
industrial property tax rates.

Poelzer said his company likely would have applied for the farm tax 
break, but he said it's not a make-or-break issue for his company.

The decision to consider marijuana production "farm use" within the 
Agricultural Land Reserve also means local governments will not be 
able to prevent medical pot facilities in those areas.

Some municipalities, such as the Township of Langley, have passed 
bylaws banning marijuana facilities on agricultural land and 
restricting them to industrial areas.

But Langley Mayor Jack Froese said the provincial government has 
effectively overridden the town's bylaw when it comes to the 
Agricultural Land Reserve.

"Having an intensive operation, that's challenging, and in industrial 
land, we have a lot more authority and bylaws," he said.

"We want to make sure that the new system protects our residents and 
is safe for the people working there."
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MAP posted-by: Jay Bergstrom