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Potential Pot Tax Going To Voters
riv city council
cal campbell
Riverbank City Council member Cal Campbell votes against sending a proposed back-up tax on cannabis to Riverbank voters in November at a recent meeting. The measure originally was proposed for a 15 percent tax on gross receipts, but passed, 4-1, at 10 percent. - photo by Ric McGinnis

Members of the Riverbank City Council have agreed to send a ballot measure to voters in November authorizing the city to impose a reduced 10 percent business license tax on the gross receipts of cannabis businesses in the city. The original proposal was for 15 percent.

About a year ago, the council, in accordance with the new state law permitted residents’ personal “non-medical (adult or recreational use) of marijuana related to the cultivation, distribution and delivery, transportation, manufacturing, testing laboratories, dispensaries, and micro-marijuana facilities,” according to staff reports.

At the time, the council established that a Development Agreement would be required with each permit application, providing funding to the city for regulatory and management costs.

Staff noted that this new ballot measure would establish a business license tax ordinance, to be established in the case where the state should, at some time in the future, find the Development Agreement improper or inadequate. The city would easily be able to switch to the license fee with no gap in funding, should it be needed.

There was some discussion by council members about the need to put another tax on small businesses, but staff clarified that it would only be necessary as a back-up if the state acted to eliminate the city’s present procedures.

A further discussion resulted in the cap on the tax rate being lowered from 15 to 10 percent as the motion to approve was presented.

The council voted 4-1 for sending the 10 percent limit to voters in the fall, with member Cal Campbell voting against. He argued for the original 15 percent cap.

Riverbank has one commercial sales facility permitted and operating on Patterson Road with another in the middle of the permitting process.

On the Tuesday, June 26 council agenda, members were scheduled to consider extending a moratorium on new cannabis dispensaries for another six months. In the accompanying staff report, city staff notes the original six month moratorium is set to end on July 23.

Based on the report, the staff proposed extending the “time out” to study further the effects the two already permitted facilities are having on life in Riverbank.

There was extensive study of the existing location, called Flavors, that is open near the intersection of Oakdale and Patterson roads (on Highway 108). A second dispensary, Riverbank Wellness, located in downtown (next to City Hall South, on Third Street), is in progress on plans to make building improvements and has yet to open.

In addition, the planning department has one other application on hold since the moratorium was enacted, but an Architectural Site Plan Review approval has been granted for a retail shell. It is located at the corner of Third and Atchison streets, across from the Del Rio Theatre building.

The report notes the six-month moratorium has provided time for Flavors to open and establish their daily routines for three months and for staff to assess their impacts on the surrounding community.

The council was expected on Tuesday night to consider extending or lifting the moratorium after the current period is over, at the end of July.