HomeMy WebLinkAbout2018-07-24 Written Communications - Item 7 VelazquezCouncil communications
Leslie Wolf Branscomb
Sr. Council Aide to Councilmember Pat Aguilar
(619) 495-7230
From: cynara@communityengagementresources.com [mailto:cynara@communityengagementresources.com] On Behalf Of Cynara Velazquez
Sent: Tuesday, July 24, 2018 3:28 PM
To: Patricia Aguilar; Francisco Estrada; Albert Velasquez; Steve C. Padilla; Mike Diaz; Leslie Wolf Branscomb
Subject: Concerns regarding Cannabis Tax Measure
Dear Chula Vista City Councilmembers,
We are very concerned with the $10 - $15 per square foot cultivation tax being proposed in Chula Vista. This would be the highest proposed tax rate in the county - San Diego and San
Diego County have no tax on cultivation. La Mesa has proposed a cultivation tax of $7 - $10 per square foot to be placed on the ballot.
We are concerned with Chula Vista locking itself to a tax range that would discourage cultivators from doing business in the city.
Berkley, Oakland, and Monterrey County, early adopters of cannabis cultivation taxes have ALL had to cut their cultivation taxes. Berkley cut its cultivation tax rate from 10% to 5%.
Monterrey County dropped their tax rate from $15 per square foot to $5 per square foot.
Both Berkley and Monterrey County were able to vote to drop their tax rate directly, since the taxes were passed via council vote. However, Oakland now finds itself in the quandary
that Chula Vista could face if you put this tax on the ballot as proposed - since Oakland passed its tax via a ballot initiative, they have had to place a second ballot initiative on
the ballot for this November, to allow the City Council to lower the cannabis tax.
Please don't lock your city into a tax range that is later found to be economically unsustainable. We propose that you revise the cultivation tax range to be from $5 - 15. The city
could still set the initial tax to $10, but this would give you the flexibility to respond to market change. You risk nothing by allowing a lower limit, because you can still choose
to set a higher initial rate.
Also, I do not see an exemption for medical cannabis sales. Only deliveries would be allowed to have medical sales, which, already have to be tracked separately for state taxing purposes.
We do not believe that medical sales will be a big portion of anyone's sales, with adult use marijuana readily available, the only people that will bother to get a medical card will
be genuine patients. So, please be kind to cancer patients - don't charge additional tax on their medicinal purchases - please exempt medical sales from your gross receipts tax.
Thank You,
Cynara Velazquez
Association of Cannabis Professionals
619-208-0567
P.S. Here are some articles on how other jurisdictions have had to revise their cultivation tax rates:
http://www.ksbw.com/article/big-tax-relief-coming-to-cannabis-growers-in-monterey-county/20879708
https://www.eastbayexpress.com/oakland/lower-cannabis-taxes-will-be-an-option-on-oaklands-november-ballot/Content?oid=18226485
https://www.sfgate.com/bayarea/article/Berkeley-cuts-its-cannabis-tax-rate-in-half-to-12614132.php