TITLE
Recommendation to conduct a hearing on the proposed levy of the Marijuana Business License Tax, receive supporting documentation into the record, conclude the hearing; adopt a finding of emergency; and adopt resolution calling for an election on November 2, 2010, for the purpose of authorizing such a tax. (Citywide)
DISCUSSION
July 6, 2010, City Council approved setting a public hearing on August 3, 2010 to consider placing a ballot measure on the November 2010 general election for a business license tax on medical marijuana collectives, other marijuana businesses and marijuana cultivation sites. The primary purpose of this tax is to help address the projected $18.5 million General Fund deficit in Fiscal Year 2011 (FY 11) and subsequent projected deficits in FY 12 and FY 13 that will occur as labor costs continue to rise while revenue remains sluggish. Without additional revenue, the City's ability to continue providing core services such as police, fire, parks and recreation, library, public works and infrastructure improvements will diminish over time.
On March 23, 2010, the City Council endorsed a five-pronged approach to balance the City's budget in FY 11. A critical component of this five-pronged approach is the creation of new revenue. In researching initiatives that could increase the City's revenues, it was discovered that other California cities, including Sacramento, Berkeley and Oakland, are all . bringing forward ballot measures to initiate, increase or expand their business license taxes with respect to medical marijuana and other marijuana establishments that will arise if Proposition 19 passes and marijuana is legalized. Since the City Council meeting on July 6, 2010, an additional two California cities have brought forth potential ballot measures related to marijuana businesses to their City Councils including San Jose and Albany. This increasing list of cities shows that the potential of taxation is being considered as a solution to mai...
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