Murchison & Cumming LLP

California Jurisdictions Place Cannabis Measures On the Ballot

October 27, 2020

By: Kelly Hayes

Election day is only 1-week away and Commercial Cannabis Licensing seems to be one option that many jurisdictions are considering in order to secure fiscal funding in the wake of the COVID-19 pandemic. Below are just some of the local Cannabis measures that could be on your November 3, 2020 Ballot:

Trinity County's Measure G establishes a Flat Rate Tax per pound of Cannabis that varies based on the type and weight of Cannabis harvested. The "Full Rate" values are as follows: $15.44/lb. for Cannabis flowers; $4.59/lb. for Cannabis leaves; and $2.16/lb. for fresh Cannabis plants. The amount of pounds of each Cannabis category shall be taxed no more than a specific percentage of the full rate:

  • First 100 lbs. shall be taxed no more than 25% the "Full Rate".
  • More than 100 lbs. - 400lbs. no more than 50% the "Full Rate".
  • 400 lbs.-1,000 lbs. shall be taxed no more than 75% the "Full Rate".
  • More than 1,000 lbs. shall be taxed no more than the "Full Rate".

Orange County:

  • Costa Mesa's Measure Q will allow the City to develop licensing for Retail and Delivery businesses to operate within specific areas of the City. It also imposes a gross receipts tax of 4% to 7% on those Retail Cannabis businesses.
  • La Habra's The City currently allows up to (4) Distribution facilities and (4) Testing Laboratories. Measure W will establish that a tax on those businesses could not exceed 2.5% of gross receipts. It further authorizes the City to establish licensing of up to four (4) Delivery Licenses and authorize a Cannabis tax of up to 6% of gross receipts on other Cannabis businesses.
  • Laguna Woods' Measure V is advisory vote seeking voter input on whether the City should establish a regulatory licensing framework for commercial Cannabis Retail and Delivery businesses within commercial zoning districts in the City.

San Diego County:

  • Encinitas' Measure H will open up commercial Cannabis licensing for Cultivation, non-volatile Manufacturing, Cannabis kitchens, Distribution, and up to (4) Retail and Delivery facilities. The Measure would also permit Industrial Hemp in Agricultural zones.
  • Lemon Grove: Measure J, with a general Cannabis business tax of up to 8% of gross receipts for Retail sales, including Delivery and microbusinesses; and up to (4%) of gross receipts for Cultivation and Manufacturing of Cannabis; up to two percent (2%) of gross receipts for Testing laboratories; up to three percent (3%) of gross receipts for Distribution of Cannabis. The City currently only allows medicinal Cannabis Retailers. If passed, this Measure would likely provide the City with incentive to open up additional types of recreational Cannabis licenses.
  • Oceanside's Measure M - Amends the current City code to impose a new business license tax. The City Council may impose a tax of up to 6% of gross receipts generated by Cannabis Retailers, manufacturers and distributors. Cultivation would be no higher than 3.5% of gross receipts.
  • Solana Beach's Measure S – Authorizes a total of two (2) adult-use/medicinal storefront Cannabis Retailers and would impose an additional 1.25% sales tax upon gross sales of non-Medical Cannabis and non-Medical Cannabis products. Personal indoor Cultivation would be allowed with specific requirements.

Ventura County

  • Ventura County's Measure O will allow commercial Cannabis Cultivation, nursery Cultivation, Processing and Distribution within unincorporated areas of Ventura County. Establishes a 4% gross receipts tax on Cultivators and 1% gross receipts on Nurseries.
  • Ojai's Measure G will establish an immediate 3% tax on Cannabis businesses. The City will be authorized to increase the tax up to 10% of gross receipts. The City currently allows for the following types of Cannabis businesses: Testing Laboratories, and a maximum of: (2) Manufacturers, and (3) Microbusinesses.
  • Ventura (City): Currently prohibits any Cannabis operations. If passed, Measure I could open up licensing opportunities for Cannabis businesses. It proposes a maximum tax on gross receipts as follows: 2.5% for Testing Labs; 8% for Retail, and Microbusiness Retail; 3% for Distributors; and 4% for Manufacturing, Non-Retail Microbusiness, and any other type of business not otherwise specified. Cultivation will be taxed per square foot of canopy ranging from $2.00 - $10.00 per square foot of canopy, depending on lighting.

Riverside County

  • Banning's Measure L will impose an annual tax on Cannabis Distribution facilities in an amount equal to ten percent (10%) of their gross receipts. The City currently permits Retailers, Cultivators, Manufacturing and Testing. In July 2020, the Banning City Council passed an ordinance to allow Cannabis Distribution facilities, if a Cannabis Distribution tax is approved.
  • Jurupa Valley's Measure U would open up commercial Cannabis Cultivation, Distribution, Manufacturing, Testing laboratories and Retailers with a conditional use permit and annual regulatory permit. The number of Retailers will be limited, and based on population (1 per 12,000 population). A total of 9 Retailers could operate under the City's current population.


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