55D - RESO COMMERCIAL CANNABIS LICENSE TAX

Home Browse Search

Proposed Commercial Cannabis Business Taxation Ballot Measure for Public Consideration on the November 2018 Ballot July 3, 2018 Page 2 (NS -2864), codified in sections of chapters 18 (regulations) and 21 (taxation) of the Santa Ana Municipal Code (SAMC), resulting in the passage of this measure regulated the location, operation and establishment of medical marijuana collectives in the city of Santa Ana. The ordinance provided for the establishment/permitting of 20 medical marijuana collectives and proposed to address the proliferation of illegal marijuana dispensaries throughout the City. This also provided the City with a mechanism to close illegal dispensaries and address associated public health and safety concerns due to a lack of resources. Following the adoption of Measure BB, the City established an implementation plan, enforcement program, administrative policies, and best practices. In November 2016, the majority of voters in California (57%) and in Santa Ana (52%) approved Proposition 64, the California marijuana legalization initiative, also known as the Adult Use of Marijuana Act (AUMA). The AUMA immediately legalized the possession, use, and cultivation of up to six mature cannabis plants at a residence for personal use. Following Proposition 64's passage, the California legislature adopted SB 94 which merged and streamlined many of the standards and license types for medicinal- and adult -use cannabis. Both Proposition 64 and SB 94 provide for the following types of commercial cannabis activities: • Laboratory Testing • Manufacturing/Processing • Distribution (Wholesale) • Cultivation • Retail • Microbusiness Significance and Enforcement Background Following the passage of Proposition 64, local jurisdictions such as the City of Santa Ana (City) were required to adopt an ordinance to establish a regulatory framework for cannabis related activities. If the City failed to adopt an ordinance on commercial cannabis activities by January 1, 2018, the local jurisdictions risked reduced control over local land decisions and commercial cannabis businesses may have been able to operate without requiring local approvals. On November 21, 2017, the City Council adopted an ordinance that created a new chapter (Chapter 40) to regulate adult -use retail cannabis business activities. The City and its community have benefited from the successes brought by Measure BB. Through Measure BB, the City has been able to responsibly allow and regulate the medicinal cannabis retail industry. Measure BB has generated significant revenue through gross receipts taxes that have funded enforcement efforts by the Santa Ana Police Department, Code Enforcement, the City Attorney's Office, and the Finance & Management Services Agency. Of the roughly 120 illegal dispensaries open prior to Measure BB, 85 percent were successfully shutdown and additional properties are in receivership in an effort to close outstanding illegal operators. In 2017 alone, the enforcement efforts effectively closed 67 illegal dispensary locations. 55D-2