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care facilities for the elderly or residential hospice or home health <br />agencies <br />Option #3 — City Initiative to Regulate <br />• Propose a ballot measure that permits medical marijuana collectives, <br />but with additional regulations not contained in the collective- backed <br />initiative: <br />• Limit permitted zones to industrial only (M1, M2) <br />• Set a maximum number of dispensaries (8) <br />• Establish distance / separation requirements from sensitive uses <br />and residential properties <br />• Establish certain operational requirements (security, signage, <br />lighting, hours of operation, etc.) <br />• Establish Business License Tax, licensing, registration and <br />minimum basic tax amount <br />• Would not prohibit medical marijuana from being prescribed and /or <br />distributed by State - licensed clinics, health care facilities, residential <br />care facilities for the elderly or residential hospice or home health <br />agencies <br />Fiscal Implications <br />• City sponsored initiative would: <br />• Include sufficient definitions to address the variety of medical <br />marijuana business models (Non - profit, LLC, etc.) <br />• Include definition and tax rate for cultivation (although not <br />permitted) <br />• Include a scalable gross receipts tax rate that could be modified by <br />the City Council <br />• Require monthly remittance of business tax rather than quarterly <br />Revenue Projections <br />• The following projections are estimates based on the experiences of <br />other California cities that currently permit, but regulate, collectives. <br />Gross <br />Receipts Tax Revenue" <br />1% <br />$15,000 <br />2% <br />$30,000 <br />Planning Annual <br />$45,000 <br />4% <br />Business License Tax <br />5% <br />$75,pg6 , <br />Compliance <br />Planning Percmit. <br />Business License Tax <br />Minimum Be sic Tax <br />Lacal State Sales <br />Total Fixed <br />9 % <br />Fee (CUP) <br />Registration ation &3tate Fee <br />$150,Dao <br />Tax @1 %' <br />Revenue <br />Inspection <br />$2,000 <br />510,000 <br />$33 <br />$2,000 <br />$15,OahD <br />$29,033 <br />Gross <br />Receipts Tax Revenue" <br />1% <br />$15,000 <br />2% <br />$30,000 <br />3 % <br />$45,000 <br />4% <br />$60,000 <br />5% <br />$75,pg6 , <br />6 % <br />$90,000 <br />7 % <br />$105,000 <br />9% <br />$120,090 <br />9 % <br />$135,DaD <br />SD% <br />$150,Dao <br />"Based on estimated annual gross .s les of $1.5 mllllon <br />Staff Recommendation <br />SOWUI Per D5spcnsary $109,09'4' <br />x S Dispensarles <br />Total) $83P,Pfi4 <br />CITY COUNCIL MINUTES 16 JUNE 3, 2014 <br />1 0A -16 <br />