Mendocino County, California, Cannabis Business Tax, Measure AI (November 2016)
| Measure AI: Mendocino County Cannabis Business Tax |
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| The basics |
| Election date: |
| November 8, 2016 |
| Status: |
 Approved
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| Topic: |
| Local marijuana tax |
| Related articles |
| Local marijuana tax on the ballot November 8, 2016 ballot measures in California Mendocino County, California ballot measures County tax on the ballot |
| See also |
| Mendocino County, California |
A measure to establish a business tax for cannabis cultivation and dispensaries was on the ballot for Mendocino County voters in Mendocino County, California, on November 8, 2016. It was approved.
| A yes vote was a vote in favor of establishing a business tax of not more than 10 percent of gross receipts for cannabis cultivation and distribution to fund county services. |
| A no vote was a vote against establishing a business tax of not more than 10 percent of gross receipts for cannabis cultivation and distribution to fund county services. |
Aftermath
| Lawsuit overview | |
| Issue: Supermajority approval; measure actually needed a two-thirds majority approval because it was for a special tax. | |
| Court: Superior Court of Mendocino County | |
| Timeline: Filed in 2017 about a 2016 ballot measure | |
| Ruling: Ruled against plaintiffs, said they misread the law regarding supermajority votes of fees and levies. | |
| Plaintiff(s): Michael Johnson, Pebbles Trippet, Terry Johnson, Noel Manners, Paula Deeter, Rod Edwards, Ralf Laguna | Defendant(s): County of Mendocino |
| Plaintiff argument: The measure should be considered a special tax and should have needed to be passed with a two-thirds majority vote. | Defendant argument: The measure is a general tax and the voter approval percentage was sufficient. |
Source: Superior Court of Mendocino County
A group of cannabis entrepreneurs filed a lawsuit against Measure AI in the Mendocino County Superior Court in February 2017. They claimed that the tax was actually a special tax because of its association with specific spending priorities and that it therefore needed to be passed by a two-thirds majority vote. On April 21, 2017, a Mendocino County judge denied the motion for a legal challenge, though the group declared their intention to appeal the decision.[1][2]
The First District Court of Appeal affirmed the decision on August 8, 2018, stating that Measure AI did not propose a special tax and did not require a two-thirds (66.67%) vote.[3]
Election results
| Measure AI | ||||
|---|---|---|---|---|
| Result | Votes | Percentage | ||
| Yes | 22,375 | 63.04% | ||
| No | 13,121 | 36.96% | ||
- Election results from Mendocino County Elections Office
Text of measure
Ballot question
The following question appeared on the ballot:[4]
| “ |
Shall Chapter 6.32 be added to the Mendocino County Code, placing a business tax on cannabis cultivation and dispensaries (not to exceed 10% of gross receipts) and cannabis distribution, delivery, manufacturing, nurseries, testing laboratories and transportation businesses ($2,500.00 per year, to be adjusted in accordance with consumer price index increases) of medical and nonmedical cannabis where legalized by state law, potentially generating millions of dollars annually to help fund county services be approved?[5] |
” |
Impartial analysis
The following impartial analysis of the measure was prepared by the office of the Mendocino County counsel:
| “ |
This ballot measure seeks voter approval to amend the Mendocino County Code to add Chapter 6.32 to add a Cannabis Business Tax. This is a general tax and would apply only to the unincorporated areas of the County. This measure would impose a business license tax on cultivating, manufacturing, dispensing, producing, processing, preparing, storing, providing, donating, testing, selling or distributing, medical cannabis or medical cannabis products. If non-medical cannabis activity becomes legal in the State of California, this Ordinance would also apply to non-medical cannabis businesses. The tax imposed by this measure would be an annual tax. The initial rate for commercial cannabis cultivation would be 2.5% of the gross receipts per fiscal year with minimum rates of $1,250.00 for cultivation of 2,500 square feet or less, $2,500.00 for cultivation of 5,000 square feet or less, and $5,000.00 for cultivation of greater than 5,000 square feet. This tax could be increased by the Board of Supervisors after July 1, 2020. This measure allows for the Board of Supervisors to increase the tax in increments of 2.5%, with a maximum tax rate of 10%. Such increases may occur only once per fiscal year, and may occur only after approval by the Board of Supervisors at a regularly scheduled meeting. This measure would also provide for a commercial cannabis tax for all other businesses besides cultivation at a flat rate of $2,500.00 per year, to be increased after July 1, 2020 according to the Consumer Price Index. This measure provides for penalties and interest for the failure or refusal to pay the business tax. This measure provides that cultivation of personal medical cannabis would be exempt from this business tax. This measure was placed on the ballot by the Board of Supervisors. This measure must be adopted by a majority of the voters. A YES vote will be a vote in favor of adoption of the proposed ordinance. A NO vote will be a vote against the adoption of the proposed ordinance[5] |
” |
| —Mendocino County counsel[6] | ||
Full text
The full text of the measure is available here.
Path to the ballot
This measure was put on the ballot through a vote of the governing officials of Mendocino County, California.
Recent news
The link below is to the most recent stories in a Google news search for the terms Mendocino County Local marijuana tax. These results are automatically generated from Google. Ballotpedia does not curate or endorse these articles.
See also
External links
Footnotes
- ↑ Ukiah Daily Journal, "Cannabis plaintiffs file lawsuit against Mendocino County tax on marijuana," February 11, 2017
- ↑ Ukiah Daily Journal, "Judge denies motion to halt Measure AI cannabis business tax; plaintiffs to appeal," April 21, 2017
- ↑ FindLaw, "Michael Johnson v. County of Mendocino," August 8, 2018
- ↑ Mendocino County, "Candidate List CONSOLIDATED General Election November 8, 2016," accessed October 3, 2016
- ↑ 5.0 5.1 Note: This text is quoted verbatim from the original source. Any inconsistencies are attributable to the original source.
- ↑ Mendocino County, "Measure AI," accessed October 4, 2016
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