Measure F expected to generate $120-135K annually for Nevada City
May 24, 2018
No opposition has surfaced for Nevada City's Measure F, which would tax cannabis businesses within city limits to fund general municipal expenses such as police, fire, streets and recreation. The tax is expected to generate approximately $120,000 to $135,000 annually if passed.
The Nevada County Cannabis Alliance worked with Nevada City staff to craft the tax measure language and is supporting Measure F.
"They addressed a lot of our concerns," said Jonathan Collier, a member of the alliance executive board.
Alliance Director Diana Gamzon said the measure was fair and reasonably written, and took the needs of the fledgling cannabis businesses into consideration.
"This is a new industry and there is uncertainty," she said, pointing out that the tax rates proposed by Nevada City are on the lower end for the state.
Collier said it was important to clarify to voters that the measure only applies to Nevada City, not to the county as a whole.
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And, he said, the tax rates listed on the ballot are the maximum rates, not the starting rates.
"The beginning tax is 2 percent (for cannabis businesses)," Collier said. "They have the power to adjust that, depending on how industry is doing. They are starting low and can adjust as they need to."
According to a fact sheet issued by the city, the tax will be applied to all operators in the supply chain, including nurseries, processors, distributors, transporters, manufacturers, testing labs and dispensaries.
The general tax would go into effect July 1 and will not sunset. It imposes maximum rates not to exceed $7 per canopy square foot for cultivation (which includes nurseries), 8 percent of gross receipts for retail cannabis businesses such as a dispensary or distribution business, and 6 percent for all other cannabis businesses.
The city will adopt lower starting tax rates, however, to incentivize compliance and offset startup costs. According to the fact sheet issued by Nevada City, those rates will be at 4 percent for dispensaries, 2 percent for other cannabis operations and 50 cents per canopy square foot for nurseries.
The argument in favor of Measure F, penned by Mayor Duane Strawser, council member Evans Phelps and Planning Commission Chairman Stuart Lauters, says the measure guarantees cannabis businesses pay their fair share of taxes and will ensure that Nevada City has the resources to properly regulate and support the cannabis industry without reducing investment into core city services.
No argument against Measure F was submitted to the county elections office.
Contact reporter Liz Kellar at 530-477-4236 or by email at firstname.lastname@example.org.