OROVILLE — The question of whether commercial cannabis operations will be allowed in Oroville is on the agenda for the City Council meeting Tuesday night.
The question before the council is of two parts. The first is whether to allow marijuana businesses in the city, and the second concerns the taxing structure that would be imposed on such endeavors.
Any tax would have to be approved by the voters, and the measure on the council agenda Tuesday envisions putting the tax on the November 2018 ballot.
The taxing measure as drafted would allow a tax of up to 10 percent of gross receipts on the range of marijuana businesses that are allowed under the passage of Proposition 64 in November 2016.
However the staff report recommends a lower initial tax level.
“The city recognizes that businesses will be bearing many initial costs as they adjust to the new legal environment and adhere to State of California regulations,” reads the staff report in the agenda. “As such, imposed tax rates are intended to secure funding for the needs of the community, while not overburdening the market.”
The initial tax proposed would be 5 percent on retail establishments, those that manufacture cannabis-laced products, and cultivators
Delivery services and nurseries would be taxed at 3 percent, and testing operations would face no tax.
A “general” tax is proposed, which could be used for any service the City Council wished to fund, and it would only require a simple majority for voter approval.
The staff report says such a tax could bring $300,000 to $600,000 a year to the city.
The city would not be alone in allowing such businesses. A report given to the Butte County Board of Supervisors on Tuesday indicated that 22 counties and 144 cities allow some form of commercial cannabis businesses.
The open session of the council meeting starts at 6:30 p.m. Tuesday in the Council Chambers 1735 Montgomery St.
In other action, the council will be asked to lease another 6 acres at the Oroville Airport to the Northwest Lineman College.
The college’s intent is to use the property to developing a training site for natural gas installations, although the college says it could be used for other goals.
The city would receive a quarterly rent of $1,846, subject to an annual 2 percent increase.
The council is also being asked to extend interim City Administrator Tom Lando’s contract through Oct. 31, at a cost of $30,400. His existing contract expires June 30.