Seeking to bring in revenue from the city’s flourishing medical marijuana businesses – and setting the stage for the possible legalization of pot by voters in November – Berkeley Mayor Tom Bates is proposing a new tax on cannabis businesses.
Under a proposal he presented to a medical marijuana subcommittee on Wednesday, Bates would tax medical marijuana dispensaries $25 per $1,000 in gross receipts. If pot becomes legal after the November election, Bates is proposing to levy a tax on those selling pot for recreational use of $100 per $1,000.
“I am shooting high with this tax,” said Bates. “It can be lower.”
The proposed tax was significantly higher than one recommended to the city council in May, and drew surprised gasps from the audience, which was made up of patients, representatives from Berkeley’s three dispensaries and patient collectives.
Bates and City Council members Darryl Moore, Laurie Capitelli, Linda Maio, and Max Anderson have been meeting regularly to gain a better understanding of Berkeley’s medical marijuana industry. The aim is to put a measure on the November ballot.
As Bates passed out his proposal, he cautioned that none of the city council members had seen it, and that it most likely will be changed significantly before it goes on the ballot. The medical marijuana subcommittee will meet next Wednesday to discuss the proposal further. It will then go to the City Council on June 29.
Bates’ proposal would:
- Allow each of the three dispensaries to have an ancillary site in an industrial area. These sites would not serve patients, but would be used to grow marijuana and process cannabis products.
- Limit cultivation by collectives to 100 square feet in a house.
- Require that there be a buffer zone between dispensaries and private schools, in addition to the one required for public schools. Reduce this zone from 1,000 to 500 feet.
- Require dispensaries who get a new ancillary location to dedicate 1/10 of their product to low-income patients.
- Impose a maximum tax rate of either $25 per $1,000 of gross receipts on dispensaries or $25 a square foot if the dispensaries become nonprofits.
- Tax sale of cannabis used for recreation at $100 per $1,000 of gross profits. (if possible)
- Modify the structure of the Medical Cannabis Commission to make it a city-appointed commission. This would diversify its membership.