Voters have stamped their approval on three measures that would impose taxes on the marijuana industry: two in Solano County and one in Lake County.
Measure K in Lake County authorizes the county to enact a marijuana business tax at the rates of $1 per square foot for nurseries and cultivators, and between 2.5 percent and 4 percent for other cannabis businesses.
According to the measure’s verbiage, the new tax applies to an array of cannabis operations, “including, but not limited to, dispensing, producing, processing, preparing, storing, providing, donating, selling or distributing medical cannabis or medical cannabis products by commercial cannabis businesses in the unincorporated area of the county.”
Eric Sklar, a Lake County entrepreneur in the cannabis industry, supported the measure.
“There’s a tax that’s been in place on cultivation for a while now, but the other types of cannabis businesses weren’t being taxed, so we thought it only fair,” said Sklar, CEO of Fumé. “We think the measure was well crafted and we’re glad it passed.”
Sklar has multiple cannabis businesses under the Fumé banner.
“We’re cultivators, we have a delivery business, a manufacturing and distribution business as well,” he said. “We’re proud to be working in Lake County, and we’re actually very proud of the way the community works together to figure things out.”
Nate Whittington, incoming chair of the California Growers Association, a statewide membership organization focused on information, community, and advocacy in the cannabis industry, said he wasn’t surprised Measure K passed.
“That is a taxation model that wants to support the cultivation business as a whole,” Whittington said. “That tells me there was some good industry input to it.”
The two cannabis-taxation measures in Solano County that passed are on the city level, as the county itself bans commercial cannabis operations.
Measure C is a commercial cannabis tax for the city of Suisun.
“Suisun City doesn’t allow cultivation, they only allow retail,” Whittington said. “That’s why they made their tax model on a gross-receipts level (15 percent) and then $25 per square foot for commercial activities. That model kind of makes sense because of how much cash runs through a retail establishment.”
Unlike Suisun City, Benicia does allow the cultivation of cannabis, Whittington noted. The passage of Measure E taxes up to $10 per square foot for cannabis cultivation, and 6 percent of gross receipts for general city services.
“The model there of $10 per square foot is pretty high,” he said. “That will basically narrow the field of indoor-grow operations that could be located within the city, so that tells me they’re looking to draw well-funded indoor cultivation operations to their area. That would be a very limited pool of permit businesses.”
Another cannabis-business tax that seems to have passed Tuesday was Measure I in the northern Mendocino County city of Willits. It garnered nearly three-quarters of the vote.