TITLE
Recommendation to request City Attorney to prepare ordinance to amend the Long Beach Municipal Code (LBMC) to reduce the adult-use and medical cannabis cultivation and retail taxes for equity businesses by half the rate set in Section 3.80.261 of the LBMC. (Citywide)
DISCUSSION
On March 15, 2022, the City Council directed City staff to investigate the feasibility of repealing the tax for cannabis cultivation (medical and adult-use) in Long Beach, including fiscal and workforce impacts, and present to the Budget Oversight Committee within 90 days.
On May 10, 2022, the City Council directed City staff to prepare a report exploring the feasibility of reducing the City's adult-use cannabis retail tax rate to align with the medical cannabis retail tax rate within 90 days and submit the findings to the Budget Oversight and Economic Development and Finance Committees for discussion.
On June 27, 2022, a memorandum was released to the City Council regarding the status of the cultivation and adult-use retail tax reduction feasibility studies. The findings of these feasibility studies were released to City Council in one comprehensive report on August 17, 2022.
Staff presented the findings of the cultivation and adult-use retail tax reduction feasibility studies to the Economic Development and Finance Committee on August 18, 2022, and Budget Oversight Committee on August 23, 2022.
As part of the budget adoption process on September 6, 2022, City Council passed the following motion:
Motion to reduce the adult-use and medical cannabis cultivation and retail taxes for equity businesses, and direct City Manager to come back to City Council with a report on how a potential rebate program would work where any revenues above $12 million would be rebated back to businesses who paid taxes with a prioritization on rebating back to cultivation businesses, along with an updated projection report to City Council on the status of cannabis revenues. This action will promote...
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