Supervisors to debate approving commercial marijuana activity
A week from Tuesday, the Board of Supervisors will debate the pros and cons of permitting marijuana sales and commercial cultivation in Riverside County’s unincorporated communities.
“Developing a comprehensive regulatory framework … related to medicinal and adult-use cannabis businesses and cannabis activities, with a companion tax measure, would enable the county to better manage an already growing and uncontrolled industry,” according to a statement released by the Board of Supervisors’ Cannabis Ad-Hoc Committee.
After almost five months of work, the panel developed a framework of rough policy proposals intended to guide the board toward a master ordinance governing cannabis sales and distribution.
The committee, headed by Supervisors Kevin Jeffries and Chuck Washington, focused on adapting the county to new realities stemming from the approval of Proposition 64, the Adult Use of Marijuana Act, last November.
The act made it legal for individuals 21 years and over to use marijuana recreationally — not just as a medical remedy for various conditions. It also legalized personal marijuana grows limited to six plants per individual within enclosed structures, as well as the possession of 28.5 grams of raw product and eight grams of concentrated cannabis.
The state law that laid the groundwork for the proposition, the Medical Cannabis Regulation & Safety Act of 2015, was clarified and streamlined under a unified regulatory structure established by Senate Bill 94, which the governor signed into law on June 27. The new regulatory scheme is now operative under the Medicinal & Adult-Use Cannabis Regulation & Safety Act.
The committee took those facts into consideration in coming up with an outline for how the county might successfully regulate cannabis sellers — and collect taxes from them to boost revenue.
“By regulating and taxing cannabis-related businesses, the potential consequential positive impacts are: creation of rigorous safety standards to protect residents … land use authority to carefully locate these businesses in appropriate zones … creation of a new revenue stream to provide enforcement dollars … and a new source of revenue for the county’s general fund,” according to a committee statement.
Jeffries and Washington said a licensing regime for commercial activity would mean prospective vendors are closely vetted and the “illegal market” might dry up as sales are no longer part of the “underground” economy.
They acknowledged, however, that the legal retail market may suffer if taxes are too high. Under Prop 64, there’s a 15 percent statewide excise tax on all cannabis-related retail sales transactions — on top of existing general sales and use taxes — as well as a $9.25 per ounce cultivation tax for cannabis flowers and $2.75 per ounce tax for dried cannabis leaves.
The committee also stated that the “black market” for cannabis could increase in size, despite regulations, and that addiction problems may only multiply, with a consequent spike in violent crime. Because many cannabis sellers rely on cash-only transactions, collecting tax revenue may be complicated, the committee further cautioned.
Tentative estimates put county revenue generation from cannabis taxation at between $10 million and $17 million annually.
Any proposed legalization of cannabis sales and commercial cultivation in the unincorporated areas must be approved by voters countywide, and the committee said the master ordinance should be ready to put before voters in November 2018.
During the last hearing in March on legalizing commercial activity, both opponents and supporters turned out to address the board. The same is expected next Tuesday.
Five cities within Riverside County have established a permitting process for commercial grows — Cathedral City, Coachella, Desert Hot Springs, Palm Springs and Perris, according to the Office of County Counsel.
County attorneys said most of the county’s existing regulations prohibiting the cultivation and use of marijuana were not automatically undone by Prop 64.
County Ordinance No. 928 does not permit mobile or stationary marijuana dispensaries to operate in unincorporated areas, and Ordinance No. 925 permits medical marijuana patients and their caregivers to cultivate up to 24 cannabis plants on private property, though all cultivation is prohibited within 1,000 feet of schools, parks and daycare centers. Growers are also required to have their pot plants hidden from view, in secure locations.
The U.S. Drug Enforcement Administration still views marijuana as a Schedule 1 narcotic prohibited under the federal Controlled Substances Act.
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