Title
a. Receive a status update on the County cannabis business tax revenue generated by nursery activities;
b. Consider the financial impacts of a tax exemption for self-producing nursery operators; and
c. Recommend the Committee take no action on a tax exemption for self-producing nursery operators at this time; and
d. Provide further direction as appropriate or consider a recommendation to the Board of Supervisors.
Report
RECOMMENDATIONS:
It is recommended that the Board of Supervisors Cannabis Committee:
a. Receive a status update on the County cannabis business tax revenue generated by nursery activities;
b. Consider the financial impacts of a tax exemption for self-producing nursery operators; and
c. Recommend the Committee take no action on a tax exemption for self-producing nursery operators at this time; and
d. Provide further direction as appropriate or consider a recommendation to the Board of Supervisors.
DISCUSSION:
At the Board of Supervisors Cannabis Committee (Committee) meeting on January 4, 2024, a local operator requested that an item come before the Committee to consider an exemption from nursery taxes. This proposed exemption would only apply to operators who produce immature plants exclusively for their own cultivation rather than selling to third parties. Staff were directed to return with a report on this concept to the Committee.
This report provides: a retrospective of the cannabis business tax generated by nursery activities, a distinction between nursery operators producing for internal or external use, and the financial impacts of a tax exemption for self-producing nursery operators.
DISCUSSION:
Origin and history of the cannabis business tax imposed on nursery activities.
Voter approval of Measure Y in 2016 was the foundational act that enabled the creation of the County of Monterey Cannabis Program (Program). The ballot measure language read as follows:
"Shall the ordinance imposing a tax on commercial mariju...
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