CORRESPONDENCE - 75F - Laserfiche WebLink

Home Browse Search

Orozco, Norma From: Materia Medica < Sent: Tuesday, June 04, 2019 1:16 PM To: eComment Subject: Tuesday, June 4, 2019 - Item#75F. Cannabis testing lab 75F. PUBLIC HEARING - ORDINANCE AMENDMENT NO. 2019-01 TO ADD TO AND AMEND CERTAIN SECTIONS OF CHAPTER 21 OF THE SANTA ANA MUNICIPAL CODE TO ALLOW VERTICAL AND HORIZONTAL INTEGRATION OF CANNABIS BUSINESSES; UPDATING PROCEDURAL STANDARDS AND REQUIREMENTS RELATING TO OWNERSHIP TRANSFERS, SECURITY DEPOSITS, AND VARIOUS ADMINISTRATIVE PROCESSES; AND REDUCING CANNABIS TESTING TAXES TO TWO PERCENT OF GROSS RECEIPTS {STRATEGIC PLAN NOS. 3, 2; 3, 3; 3, 5; 4, 3) - Finance and Management Services Agency; and Planning and Building Agency - Legal Notice published in the Orange County Reporter May 24, 2019 and May 31, 2019. To whom it may concern, I am writing in support of item#75F of today's meeting topics, specifically regarding reducing cannabis testing taxes to two percent of gross receipts. It is well known that testing labs require high capital invest due to equipment costs and qualified chemist salaries. At the same time, testing labs are under significant pressure to keep their invoices low, which means it could be years before a lab sees a return on their initial investment. Lowering taxes on labs at least gives growing laboratories a chance to retain needed funds for continued operation, capital investment, and loan repayment. It is no secret that potency results are an important factor for retailers/distributors to consider due to consumer preferences. This problem has been partially addressed at the state level by barring businesses from "shopping around" testing laboratories to maximize their potency figures on regulatory compliance batches. Again, this scenario assumes all retail cannabis falls under BCC regulation when that is clearly not the case, since black- market sales are still a big problem in California. Cannabis labs are uniquely positioned as potential bottleneck for the market yet smaller labs continue to face many challenges to survive in the industry when it is easy enough to turn to serve other industries —the longer this remains an issue there will be greater problems for the industry in the future. We applaud the City for considering alleviating at least some of those pressures on testing labs. Respectfully, Victoria Lab Manager Materia Medica Laboratories, Inc. Located in Santa Ana, CA