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Monday, Dec 11, 2023

Lighting Fire Under Pot

Measure M, the city of L.A.’s cannabis regulation initiative on the March 7 ballot, is somewhat curious in that it doesn’t need to exist.

California voters already gave local jurisdictions the authority to regulate the types of cannabis-related activity allowed within their borders through the passage of Proposition 64 on Nov. 8.

What the extra step taken by Measure M does is give the City Council cover (“It’s the voters who mandated this, not us!”) when it comes to setting the structure for cannabis business permits. Yet, it’s still worthy of support.

Once in place, regulated cannabis businesses will bring revenue to the general fund in the form of a 10 percent gross receipts tax on retail recreational marijuana sales, plus a tax of 1 percent to 2 percent for transportation, testing or research, manufacturing, cultivation, or other commercialization of cannabis.

While the exact financial impact would depend on how many dispensary permits are granted, it’s safe to say the number would be in the tens of millions of dollars. Legal marijuana sales in the state of Colorado, which has a population of about 5.5 million, topped $1 billion last year. Los Angeles has a little more than 4 million residents. The tax money for Los Angeles would be used to fund police, fire, street services, parks, libraries and other general purposes throughout the city.

What’s more, Measure M would establish a series of public hearings to allow community members, neighborhood councils, and private businesses to give input about how the licensing process should be implemented, likely later this year. That means giving on guidance on everything from how many permits should be granted to how far away shops should be from schools.

Businesses must have a local license to be granted a state permit to engage in the business. Should Los Angeles fail to get the ball rolling on that process, businesses and investors could opt to look elsewhere in the state, meaning the city missing out on badly needed tax revenue.

Even if you didn’t want Proposition 64 to pass, ensuring the law is implemented in the most effective way possible seems like a no-brainer.

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