Cannabis

At the general election of November 8, 2016, the voters approved Proposition 64 – The Adult Use of Marijuana Act. In June 2017, the California State Legislature passed a budget trailer bill - SB 94 that integrated MCRSA with AUMA to create the Medicinal and Adult-Use Cannabis Regulation and Safety Act (MAUCRSA). Under MAUCRSA, a single regulatory system governs the medical and adult use cannabis industry in California.

As of November 9, 2016, the state has allowed each city to expressly ban or allow cannabis operations, including: cultivation, dispensaries, testing, manufacturing, and deliveries. The City of Santa Paula currently allows testing, but bans all other commercial activities. The City Council members possess the ultimate authority to allow or ban cannabis activities within their jurisdiction; however, before a general marijuana tax can be imposed this year, only a majority vote from the community can approve the tax. All new taxes on cannabis must comply with Proposition 218.

If a tax measure on cannabis operations is proposed by Council, then the wording of the tax measure must be ready and submitted to Ventura County no later than July 23, 2018 to be on the November 6, 2018 ballot.

  • Tuesday, November 6, 2018 – “Measure N”: Cannabis Business Tax
    In November, Santa Paula voters will be asked to consider Measure N. If approved by a majority of Santa Paula voters, Measure N would impose a maximum tax rate on every cannabis business within the City. For cultivation and processing, a tax of up to twenty-five dollars per square foot of space would be authorized. For whole sale and retail cannabis businesses, Measure N would also impose a ten percent gross receipts tax. In addition, all cannabis businesses must pay a minimum tax of five hundred dollars ($500.00) annually. The tax rates set by Measure N can be increased or decreased by the City Council provided they do not exceed the voter-approved maximum rates.

    There are a few other key points:
    · The City currently prohibits all commercial cannabis activity with the limited exception of cannabis testing. Measure N does not change that or otherwise authorize cannabis businesses to operate in the City.
    · Measure N would be a “general tax,” meaning that the revenue from this tax would be deposited into the City’s General Fund and could be used for police enforcement and street repair, among other important funding needs.
    · Taxes would only be paid by the cannabis businesses.
    · Conservative estimates for tax revenues generated by the tax are approximately $500,000.

    A “yes” vote on Measure N would authorize the imposition of the tax while a “no” vote would not authorize the city to tax marijuana businesses.
  • Monday, May 21, 2018 (Staff Report, Presentation, Survey): The Cannabis Survey results were presented to Council and staff received direction to draft ballot language for cannabis taxation for Council consideration.
  • Monday, April 16, 2018 (Staff Report): City Council approved funds for staff to work with a consultant to produce a statistically valid survey to better understand community sentiment on the topic.
  • Monday, March 26, 2018 (Dot Voting): Staff hosted a Cannabis Town Hall at the Community Center. The meeting was attended by approximately 100 individuals that expressed their feelings on cannabis through a dot voting system with a panel discussion, public comments, and “Questions and Answers”.
  • Monday, March 19, 2018 (Staff Report, Ordinance): Staff presented a summary of Proposition 64 and the Cannabis Act to the City Council. The Council recommended that staff reach out to the community to gather public input.

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