Measure C | californiachoices.org

My vote

ALL OF LOS ANGELES COUNTY—Would tax marijuana businesses in the unincorporated areas of Los Angeles County, including $10 per square foot for cultivation; a 6% tax on gross retail receipts; a 2% tax on testing facilities' gross receipts; a 3% tax on gross distribution receipts; and a 4% tax on the gross receipts of manufacturing and other marijuana business facilities. Measure C requires a simple majority (50% + 1) to pass.

Fiscal Impact: Would generate approximately $10 million in annual revenue that would be deposited into the County's General Fund, with the potential to grow with a maturing market.

Next Los Angeles County Measure: Measure H

See Endorsements for Measure C

Details

Pro/Con

Pro:

Proponents of Measure C argue that the needs and impact of the legal cannabis industry will continue to shift in the coming years, and the tax revenue generated by the measure can help support the County's development of a health and social equity-led cannabis program, including workforce and economic development programs and reinvestment in communities disproportionately impacted by historical and current cannabis policies. They argue that Measure C allows the Board of Supervisors to either decrease or increase these tax rates up to the maximum rate provided by the measure after the first three years the initial rates are in effect.

A YES vote on this measure means: Marijuana businesses in the unincorporated areas of Los Angeles County would be taxed.

Con:

Opponents of Measure C argue that these taxes are the precise reason that the black market for marijuana is estimated to be twice the legal market. They argue that the tax is permanent and the county can gouge these local, small businesses by forcing them to pay additional taxes over and above the regular sales tax.

A NO vote on this measure means: Marijuana businesses in the unincorporated areas of Los Angeles County would not be taxed.

In Depth

If approved by the voters, the County Code will be amended to authorize a tax on cannabis businesses engaged in activities defined in the ordinance such as cultivating, selling, processing, distributing, or testing cannabis or cannabis products in the unincorporated areas of the County. Personal cannabis cultivation or use would be exempt from this tax.

From July 1, 2023 until June 30, 2026, the Measure authorizes initial tax rates of:

$7 per square foot of canopy space for cultivation using exclusively artificial lighting;
$4 per square foot of canopy space for cultivation using combination lighting;
$4 per square foot of canopy space for cultivation using no artificial lighting;
$2 per square foot of canopy space for cultivation in any nursery;
4 percent of gross receipts for retail cannabis businesses;
3 percent of gross receipts for manufacturing and processing cannabis businesses;
3 percent of gross receipts for distribution cannabis businesses;
1 percent of gross receipts for testing laboratory cannabis businesses; and
4 percent of gross receipts for any other type of cannabis business.

Beginning July 1, 2026, until repealed by the voters, the Measure authorizes the Board to adjust the tax to a rate less than or equal to the maximum annual rates not to exceed:

$10 per square foot of canopy space for cultivation using exclusively artificial lighting;
$7 per square foot of canopy space for cultivation using combination lighting;
$4 per square foot of canopy space for cultivation using no artificial lighting;
$2 per square foot of canopy space for cultivation in any nursery;
6 percent of gross receipts for retail cannabis businesses;
4 percent of gross receipts for manufacturing and processing cannabis businesses;
3 percent of gross receipts for distribution cannabis businesses;
2 percent of gross receipts for testing laboratory cannabis businesses; and
4 percent of gross receipts for any other type of cannabis business.

Beginning in July 2027, the maximum annual tax rate for cultivation will be adjusted for inflation. The ordinance also establishes processes for registration, collection, enforcement, and tax appeals. Payment of the tax does not authorize illegal or unlawful cannabis business activities, nor does it entitle a personto engage in illegal or unlawful cannabis business activities in violation of any local or State law.

If approved, revenue derived from the tax will be deposited into the County's general fund and may be used for any County governmental purpose. This measure requires a majority vote of the qualified voters in the County of Los Angeles who cast votes in the election.

Source: County Counsel's Impartial Analysis of Measure C via Voter's Edge

Voter Resources

Los Angeles County Registar-Recorder and County Clerk

Los Angeles County Consumer & Business Affairs — Cannabis Business Tax Measure C FAQs