Katelyn Baker
Well-Known Member
On Tuesday, the Board of Supervisors agreed to revisit the issue of cannabis business licenses and taxes at next week's meeting, when the board also plans to discuss a cannabis compliance ordinance.
Fifth District Supervisor Dan Hamburg recused himself from the proceedings. Because the measure required a four-fifths vote to pass, unanimity was necessary.
David McPherson, a tax consultant with HdL Companies, gave a presentation on a draft of the measure, which the board hopes will appear on the November ballot. HdL's website claims that McPherson is "the first Tax Administrator in the United States to successfully tax medical marijuana."
County CEO Carmel Angelo introduced the agenda item by explaining that "we continue to search for additional funding streams. We may have a funding stream right in front of us that could work for this county."
McPherson assured those present that his measure would tax medical cannabis at a lower rate than many other plans being discussed elsewhere in the state.
With regulatory fees and various taxes, he explained, "the ability to get compliance" ranges from 25 percent to 40 percent. He proposed to organize cannabis growing operations into outdoor, indoor and mixed-light categories.
Within each category, the size of the grow would be taxed per square foot. Therefore, an outdoor cultivation operation under 2,500 square feet would be taxed at a rate of 75 cents per square foot, while an outdoor operation over 10,000 square feet would be taxed at a rate of $2.50 per square foot. This, he stated, was a 50 percent reduction from his last proposal.
Second District Supervisor John McCowen questioned McPherson closely, saying he was "not sure why there's a higher tax on indoor and mixed light. Why not a yield tax?" McPherson replied that his system offers greater accountability and simplicity.
The public spoke unanimously against the proposal, many expressing frustration with what they perceived as unfairness and mistrust in the ordinance.
Laurence Rosen, who described himself as an attorney and a cultivator, promised the board that "those guys who do follow the law will get you your taxes."
Hannah Nelson, an attorney with the California Cannabis Compliance Alliance, pointed out that, due to high levels of crop failure, taxation based on square footage would not always reflect what farmers earn. With track and trace, she added, the quantity of the product would be well-known to regulators.
Many speakers expressed a concern that the proposed tax structure would not only drive cultivators into the black market, but into bankruptcy. Susan Schindler of Potter Valley declared herself ready to pay taxes, but told the Board she was "not OK being destroyed, and I am not OK being disrespected."
When Casey O'Neill of the CalGrowers Association spoke on the same theme, McCowen asked him if he had "a recommendation for what that tax rate should be."
O'Neill replied that he thought it should be 25 cents a square foot, but that "it's simpler to do a yield tax."
Questioned at the end of the meeting, McPherson defended his proposal. In response to a question from the board about separate taxation at several points in the product's existence as a commodity, he used the analogy of a manufacturer who makes steel, sells it to a distributor, and uses it to make other things as well. The steel, he pointed out, is also taxed several times.
However, when he offered a more specific analysis of cannabis, based on a market rate of $1,875 per pound, the public responded with a spontaneous show of skepticism, prompting 4th District Supervisor Dan Gjerde to call for order.
The deadline for measures to be approved for the ballot is Aug. 12, but McCowen maintained that "I'm going to find it difficult to support the scheme that is in front of us today...I think this measure could benefit from more public comment." He was not satisfied with the square footage tax rate, preferring one based on yield.
Angelo pointed out that if the measure does not get onto the ballot by November, "there's no rush" to approve it, adding that she is "not sure the rates are exorbitant."
McCowen promised not to invoke what Gjerde called "the 5:30 rule" at next week's meeting, and the board agreed to put the item on the agenda for July 19.
News Moderator: Katelyn Baker 420 MAGAZINE ®
Full Article: Mendocino County Supervisors Discuss Cannabis Tax Ballot Measure
Author: Sarah Reith
Contact: The Ukiah Daily Journal
Photo Credit: None Found
Website: The Ukiah Daily Journal
Fifth District Supervisor Dan Hamburg recused himself from the proceedings. Because the measure required a four-fifths vote to pass, unanimity was necessary.
David McPherson, a tax consultant with HdL Companies, gave a presentation on a draft of the measure, which the board hopes will appear on the November ballot. HdL's website claims that McPherson is "the first Tax Administrator in the United States to successfully tax medical marijuana."
County CEO Carmel Angelo introduced the agenda item by explaining that "we continue to search for additional funding streams. We may have a funding stream right in front of us that could work for this county."
McPherson assured those present that his measure would tax medical cannabis at a lower rate than many other plans being discussed elsewhere in the state.
With regulatory fees and various taxes, he explained, "the ability to get compliance" ranges from 25 percent to 40 percent. He proposed to organize cannabis growing operations into outdoor, indoor and mixed-light categories.
Within each category, the size of the grow would be taxed per square foot. Therefore, an outdoor cultivation operation under 2,500 square feet would be taxed at a rate of 75 cents per square foot, while an outdoor operation over 10,000 square feet would be taxed at a rate of $2.50 per square foot. This, he stated, was a 50 percent reduction from his last proposal.
Second District Supervisor John McCowen questioned McPherson closely, saying he was "not sure why there's a higher tax on indoor and mixed light. Why not a yield tax?" McPherson replied that his system offers greater accountability and simplicity.
The public spoke unanimously against the proposal, many expressing frustration with what they perceived as unfairness and mistrust in the ordinance.
Laurence Rosen, who described himself as an attorney and a cultivator, promised the board that "those guys who do follow the law will get you your taxes."
Hannah Nelson, an attorney with the California Cannabis Compliance Alliance, pointed out that, due to high levels of crop failure, taxation based on square footage would not always reflect what farmers earn. With track and trace, she added, the quantity of the product would be well-known to regulators.
Many speakers expressed a concern that the proposed tax structure would not only drive cultivators into the black market, but into bankruptcy. Susan Schindler of Potter Valley declared herself ready to pay taxes, but told the Board she was "not OK being destroyed, and I am not OK being disrespected."
When Casey O'Neill of the CalGrowers Association spoke on the same theme, McCowen asked him if he had "a recommendation for what that tax rate should be."
O'Neill replied that he thought it should be 25 cents a square foot, but that "it's simpler to do a yield tax."
Questioned at the end of the meeting, McPherson defended his proposal. In response to a question from the board about separate taxation at several points in the product's existence as a commodity, he used the analogy of a manufacturer who makes steel, sells it to a distributor, and uses it to make other things as well. The steel, he pointed out, is also taxed several times.
However, when he offered a more specific analysis of cannabis, based on a market rate of $1,875 per pound, the public responded with a spontaneous show of skepticism, prompting 4th District Supervisor Dan Gjerde to call for order.
The deadline for measures to be approved for the ballot is Aug. 12, but McCowen maintained that "I'm going to find it difficult to support the scheme that is in front of us today...I think this measure could benefit from more public comment." He was not satisfied with the square footage tax rate, preferring one based on yield.
Angelo pointed out that if the measure does not get onto the ballot by November, "there's no rush" to approve it, adding that she is "not sure the rates are exorbitant."
McCowen promised not to invoke what Gjerde called "the 5:30 rule" at next week's meeting, and the board agreed to put the item on the agenda for July 19.
News Moderator: Katelyn Baker 420 MAGAZINE ®
Full Article: Mendocino County Supervisors Discuss Cannabis Tax Ballot Measure
Author: Sarah Reith
Contact: The Ukiah Daily Journal
Photo Credit: None Found
Website: The Ukiah Daily Journal