Pubdate: Tue, 19 Jul 2016
Source: Tribune, The (San Luis Obispo, CA)
Copyright: 2016 The Tribune
Contact:  http://www.sanluisobispo.com/
Details: http://www.mapinc.org/media/391
Author: Kaytlyn Leslie

GROVER BEACH MARIJUANA TAX ONE STEP CLOSER TO THE BALLOT

Grover Beach Wants to Find a Way to Tax Both Medical and Recreational 
Marijuana Sales in the City

It Has Until Aug. 1 to Get the Measure to the County for the November Ballot

It Would Charge Up to 10 Percent to Medical and Recreational 
Marijuana Businesses

Grover Beach residents will likely vote on a marijuana tax measure 
this November, though the city still has to get past one more hurdle 
before it can be placed on the general election ballot.

The Grover Beach City Council once again pushed forward plans to 
place the measure on the Nov. 8 ballot at its meeting Monday night, 
after it voiced support earlier this month to take advantage of 
potential marijuana revenue.

The council indicated it would like to tax marijuana businesses based 
on gross sales, and it directed staff to return to the council's next 
meeting on Aug. 1 with the official wording for the measure. Aug. 1 
the city's last meeting before the Aug. 12 deadline to submit a 
measure to San Luis Obispo County for placement on the November 
ballot, meaning if the council does not pass the measure at that 
meeting, it will be difficult to pursue the tax before the next 
general election in 2018.

One of the biggest considerations at Monday night's meeting was 
whether to include language that would tax both medical and 
recreational marijuana businesses, in the event a recreational 
marijuana initiative succeeds on the state ballot. The council 
decided it would like to include that wording so it could quickly 
take advantage of those potential sales, rather than waiting until 2018.

The council also tentatively decided to pursue a sales-based rate 
known as a gross receipts tax, rather than a flat tax, because 
council members felt it would be more fair to small businesses.

A gross receipts tax scales the tax to size and activity, meaning 
small businesses would pay less, while larger businesses would pay 
more. A flat tax rate would charge businesses a set annual rate no 
matter a business' size or the amount of sales it makes.

The measure would propose a 5 percent tax for commercial medical 
marijuana businesses, and a 10 percent for recreational marijuana businesses.

The council also is set consider a square-footage tax - the preferred 
method for cultivation - that would charge businesses growing medical 
marijuana based on how much space the plants take up. For example, 
the staff report proposed the first 5,000 square feet of plants would 
be charged $25 per square foot, plus $5 for each additional square 
foot beyond that. A square-footage tax would be based on state licenses.

The council has for months pondered whether to pursue the measure and 
profit from medical marijuana sales in the city.

While no cities in San Luis Obispo County tax medical marijuana 
sales, other municipalities in the state do. Santa Cruz, San Jose, 
Palm Springs, Oakland and Sacramento have passed medical marijuana 
tax measures, while Santa Barbara and King City voters are expected 
to consider measures in November.

Grover Beach now permits some limited at-home cultivation, as allowed 
by the Compassionate Use Act of 1996, though it prohibits commercial 
cultivation and dispensaries. The city is in the process of 
conducting public outreach to draft new ordinances that would allow 
dispensaries or cultivation in the city, though that process is 
expected to take up to six months.
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MAP posted-by: Jay Bergstrom