Los Angeles County voters threw their weight behind a proposal that will impose business taxes on cannabis operations in unincorporated areas, once such businesses are permitted.
The county is still developing regulations for cannabis operations in unincorporated areas, with an ordinance expected to come before the Board of Supervisors next year. In the meantime, voters on Tuesday approved Measure C, establishing a tax schedule for such businesses when they eventually become permitted.
The proposal set a series of initial tax rates — 4% for gross receipts for retail operations, 3% for manufacturing and distribution, $4 per square foot for mixed light cultivation and $7 per square foot for indoor cultivation. According to county staff, the levies will initially generate an estimated $10.36 million a year. Those rates will be in effect until July 1, 2026, after which the ordinance outlines additional increases in the rates.
Although regulations for cannabis operations in unincorporated areas are still being developed, county staff indicated the initial plan will likely allow for up to 25 storefront retail cannabis businesses countywide, 25 delivery retail businesses, 10 indoor/mixed light cultivation establishments, 10 manufacturing businesses, 10 distribution facilities and 10 testing laboratories. The businesses are expected to be distributed equally in each of the five supervisorial districts.
Supervisor Kathryn Barger — whose district includes the Antelope Valley, a hot spot of illegal marijuana operations — said in August the tax measure does not mean there will a proliferation of outdoor grows.
“The approach we’ve adopted will equitably distribute legal cannabis businesses in each supervisorial district and specifies that cannabis cultivation will only be permitted indoors — not outdoors in greenhouses,” Barger said.
“Our board must be clear: we will not tolerate illegal cannabis operations. Growers who operate illegally undermine our efforts to create a regulated and responsible cannabis industry, and often do so at the expense of the rural communities I represent. I’m firmly committed to upholding the law and will corral all available resources to enhance enforcement and abatement efforts,” Barger continued.
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Jaden Hernandez says
My friends will just bring it from Mexico and sell it cheaper on the streets, bypassing all the tax hassle.
Stinger says
Ahhhh… Therein lies the key to administrative balance for regulations and enforcement vs black market growth in these cases.
I’m afraid I must agree, though. The way this proposition is written will cause undue, and very avoidable, expenses that will make black market opportunities to infiltrate the legitimate market grow (no pun intended).
Stinky Steve says
It’s just a weed
Stinger says
“…cannabis cultivation will only be permitted indoors — not outdoors in greenhouses,” Barger said.
Why? What is the cause of such an apparently bassackwards law? This will only cause expenses to go up, create a significant carbon footprint of what should be a net negative one, and increase fire danger for structures used for such purposes.
Ya gotta problem with good old fashioned sunlight, Barger?
Rick says
It’s still fascinating that in a country that prides itself on freedom, its citizens can’t cultivate a naturally occuring plant anyway they want and how much they want.
What makes cannabis so much more mind-altering than caffeine? Whom would you rather be around…a stoner or a wired motormouth?
I watch Bill Maher’s Podcast. He sits in Club Random with a celebrity drinking wine and smoking the ganja and it’s funny. I doubt if it would work if they drank espresso. It would get annoying.
Bob says
The attention a weed gets is ridiculous. decriminalize and deregulate nationwide.
Stinger says
Hey now… Don’t you be messing with my double espresso, Rick…
Jayden Hernandez says
I have a friend that owns a legal shop and he stores hash from Mexico and sells it to certain people without asking for a prescription. He won’t report all the sales to skip the taxes.
Tom says
They don’t use sun light. The desert in Lake La glows in areas that never had lights at night because the illegal grows run generators all night or steal power when available to light their grow houses 24/7. Indoor facilities will keep the smell down. This bill is pointless Ca is 4years in since weed was legalized and California has done nothing. Colorado in one year planned and accomplished a great policy that was profitable to the state, that every state should follow. La county will be giving the run around so they can keep on arresting and giving fines to illegal grows that will never pay a penny. Just hurting the future Americans that would grow in compliance with county rules.