HomeMy WebLinkAboutCC Reso 2020-05 RESOLUTION NO. 2020-05
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CATHEDRAL
CITY, CALIFORNIA, ADJUSTING THE CANNABIS TAX BASIS FOR
CANNABIS DISTRIBUTORS PURSUANT TO SECTION 3.48.040 OF THE
CATHEDRAL CITY MUNICIPAL CODE
THE CITY COUNCIL OF THE CITY OF CATHEDRAL CITY FINDS:
A. At the November 2016 general election the voters approved Measure P,
which imposes the following taxes on cannabis businesses in the City:
• Fifteen cents for each one dollar of gross receipts or fractional part thereof
received by a dispensary or by any other cannabis business for activities
other than cannabis cultivation or manufacturing.
• Twenty-five dollars for each square foot or fractional part thereof of
cannabis cultivation space.
• One dollar for each gram of cannabis concentrate produced or
manufactured.
• One dollar for each unit of cannabis-infused product other than cannabis
concentrate produced or manufactured and packaged or intended for
individual sale.
B. Measure P authorizes the Council to set the taxes on cannabis at lower
rates than what was approved by the voters, and to establish exemptions, incentives, or
other reductions.
C. Via City Council Resolution Nos. 2017-13, 2018-46 and 2019-02, the City
Council has lowered the cannabis tax rates to:
• Ten cents for each one dollar of gross receipts or fractional part thereof
received by a dispensary or by any other cannabis business for activities
other than cannabis cultivation or manufacturing from the sale of cannabis
or cannabis-infused products.
• Fifteen dollars for each square foot or fractional part thereof of cannabis
cultivation space.
• Forty cents for each gram of exotic/boutique cannabis concentrate
produced or manufactured.
• Ten cents for each gram of distillate cannabis concentrate produced or
manufactured.
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• Five cents for each gram of crude cannabis concentrate produced or
manufactured
• Forty cents for each unit of cannabis-infused product other than cannabis
concentrate produced or manufactured and packaged or intended for
individual sale.
D. The gross receipts tax applies to cannabis distributors in the City, and the
City Council now desires to exempt from this gross receipts tax licensed cannabis
distributors who also hold licenses for cannabis cultivation or manufacturing and pay to
the City cannabis cultivation or manufacturing taxes on the product being distributed.
THE CITY COUNCIL OF THE CITY OF CATHEDRAL CITY RESOLVES:
SECTION 1. Except as provided in Section 2 of this Resolution, every cannabis
distributor operating in the City shall pay the cannabis tax imposed in paragraph A of
Section 3.48.010 of the Cathedral City Municipal Code, as such tax may be adjusted from
time to time by the City Council pursuant to Section 3.48.040 of the Cathedral City
Municipal Code.
SECTION 2. The cannabis tax imposed in paragraph A of Section 3.48.010 of the
Cathedral City Municipal Code shall not apply to gross receipts received by a cannabis
distributor from the distribution of cannabis or cannabis products where the distributor
also cultivated and/or manufactured the subject cannabis or cannabis products being
distributed and paid to the City the tax imposed in paragraphs B, C or D of Section
3.48.010 of the Cathedral City Municipal Code on the subject cannabis or cannabis
products. Furthermore, a cannabis distributor shall only be eligible for this tax exemption
if all of the following criteria are satisfied:
A. The cannabis distributor holds a valid cannabis distribution license from the
City and is operating its distribution activities in compliance with all applicable
requirements of Chapters 5.88 and 9.108 of the Cathedral City Municipal Code.
B. The cannabis distributor also holds a valid cannabis cultivation or
manufacturing license from the City and its cultivation or manufacturing activities are
being conducted in compliance with all applicable requirements of Chapters 5.88 and
9.108 of the Cathedral City Municipal Code.
C. The cannabis distributor timely pays the applicable cannabis cultivation
taxes and/or cannabis manufacturing taxes to the City under paragraphs B, C or D of
Section 3.48.010 of the Cathedral City Municipal Code, as such taxes may be adjusted
from time to time by the City Council.
SECTION 3. All definitions in Chapters 3.48 and 5.88 of the Cathedral City
Municipal Code shall apply to this Resolution.
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SECTION 4. This Resolution shall take effect on March 11, 2020.
PASSED, APPROVED AND ADOPTED at a regular meeting of the City Council
of the City of Cathedral City held on this 11th day of March, 2020, by the following vote:
Ayes: Councilmembers Lamb, Gutierrez and Carnevale; Mayor Pro Tem
Gregory and Mayor Aguilar
Noes: None
Absent: None
Abstain: None
ohn Aguilar, ',ayor
ATTEST:
Tracey R.'-Martinez, City Cler
APPROVED AS TO F9RM::
Eric S. Vail, City Attorney
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