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Ordinance Amendment No. 2022-01 - Commercial Cannabis Regulatory and Tax <br />Updates <br />September 20, 2022 <br />Page 7 <br />2 <br />5 <br />0 <br />8 <br />However, the requirement for multiple Basic Tax Rate assessments can be seen to have <br />a negative impact on the formation of microbusinesses within the City. To address this <br />issue, staff recommends that the City Council adopt a special proviso for microbusinesses <br />allowing them to pay the annual Basic Tax Rate only upon their predominate commercial <br />cannabis activity, and thus allow them to be exempted from the requirement on all of their <br />other licensed activities engaged in at a single location within the City. <br />Proposed Amendments – Regulatory (SAMC Chapters 18 and 40) <br />In addition to the proposed changes listed in Table 1, the City is proposing to update and <br />streamline certain sections of Chapter 18 (Medicinal Marijuana) and Chapter 40 <br />(Commercial Cannabis Business Activities Other Than Medicinal Marijuana). Table 2 <br />(Proposed Regulatory Amendments) describes the regulatory-framework ordinance <br />amendments. <br />Table 2: Proposed Regulatory Amendments <br />Item Amendment and Impact <br />Repeal and Readopt <br />Medicinal Cannabis <br />Retail Regulations <br />(SAMC Article XIII of <br />Chapter 18) <br />Amendment: <br />Removes medicinal cannabis retail regulations from Chapter 18 by <br />deleting Article XIII and readopting as Article II of Chapter 40. <br />Impacts: <br />•Creates a single SAMC chapter addressing all commercial cannabis <br />(medicinal and adult-use) business activities, including retail, <br />cultivation, distribution, manufacturing, and testing. <br />•Enhances internal consistency of commercial cannabis regulations by <br />consolidating all regulations into a single chapter within the SAMC. <br />Community Benefits, <br />Sustainable Business <br />Practices, and Social <br />Equity (SAMC Sec. 40- <br />1) <br />Amendment: <br />Updates community benefit and sustainable business practices <br />requirement by codifying requirements and integrating required social <br />equity components. <br />Impacts: <br />•Addresses the termination date of existing commercial cannabis <br />operating agreements, which are set to expire December 31, 2022. <br />•Codifies requirement for all commercial cannabis businesses to <br />submit and have a Community Benefit, Sustainable Business <br />Practices, and Social Equity Plan (“Plan”) on file with the City. <br />•Allows the City to require proof of satisfaction of the Plan. <br />•Integrates key social equity principles into the Plan. <br />•Establishes a Plan template for internal consistency, reporting, and <br />auditing, if required.