City looking to make green off pot businesses
on October 29, 2010
Richmond may join Oakland on the growing list of California cities cashing in on the sale of medical marijuana.
Next week, Richmond residents will decide whether to charge local marijuana businesses for the sale and distribution of the substance.
Councilmember Tom Butt estimated that the city could gain “in the hundreds of thousands of dollars” if Measure V wins the simple majority vote.
“It’s a revenue measure and in essence that is the benefit,” City Manager Bill Lindsay said of the measure’s potential to fund city services.
If the measure passes, each medical marijuana business would owe the city $234.10 a year, plus an additional $46.80 per employee for the first twenty-five employees—and another $40.10 for each additional worker after that, said Antonio Banuelos, revenue manager for the city’s finance department.
“The $234.10 flat/base amount is what the City charges all businesses located or doing business in Richmond. The fee goes up from the $234.10 based on the number of employees,” Banuelos said.
In addition to those fees, medical marijuana businesses would also pay a general business license tax of 5 percent of pre-tax receipts.
Last year, Oakland became the first major city to tax medical marijuana sales. But Richmond, unlike Oakland, has a city ordinance that regulates the number and nature of the businesses.
That ordinance, adopted last month by unanimous vote, allows only three medical marijuana distributors to operate within city limits. The businesses must be nonprofit corporations. Patients can purchase up to one ounce of marijuana per day.
Measure V has generated no formal opposition.
Councilmember Butt said he suspects it’s because taxing marijuana only affects sales that are already occurring in the city.
The medical marijuana businesses are up and running, he said. If the measure passes, they would simply help fund city services.
“Some people want to indulge in it and that’s fine, but the rest of society is going to have some benefits from its taxation,” Butt said.
The money would go directly to services like police and fire protection. Services like street maintenance and parks and recreation would also benefit.
“It will be used to essentially improve public safety and the quality of life in Richmond,” Butt said.
Proposition 19, a statewide measure that would legalize the recreation use of marijuana, would have little or no bearing on the Richmond tax measure, according to Lindsay.
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