HomeMy WebLinkAbout24569RESOLUTION NO. 24569
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
PALM SPRINGS, CALIFORNIA, REDUCING THE
CANNABIS BUSINESS ACTIVITY TAX RATE ON
MANUFACTURING TO TWO PERCENT (2%), AND
SUSPENDING THE TAX ON TRANSPORTATION AND
DISTRIBUTION FACILITIES, AND TESTING FACILITIES.
THE CITY COUNCIL OF THE CITY OF PALM SPRINGS FINDS:
A. The voters of the City of Palm Springs approved Measure E at the
November 7, 2017 general municipal election by a 78.38% affirmative vote of the
electorate. The City Council recited the fact of the regular municipal election held on
November 7, 2017, and declared the result of the election at the December 6, 2017 City
Council meeting.
B. Ordinance No. 1946 (the "Ordinance"), adopted by the voters of the City on
December6,2017, amended Chapter 3.42 of the Palm Springs Municipal Code regarding
cannabis taxation. The Ordinance authorizes the City to impose a tax on the gross
receipts of cannabis businesses, apart from cultivation, as defined in the Ordinance at a
maximum amount of fifteen cents ($0.15) of every dollar of gross receipts.
C. The Ordinance provided for Council authority to impose the tax on the gross
receipts of cannabis businesses at rates lower than the maximum rate specified in the
Ordinance.
D. Resolution No. 24339, adopted by the City Council on December 13, 2017,
established the City's tax rates for permitted cannabis businesses, apart from cultivation,
at ten cents ($0.10) of every dollar of gross receipts.
E. In order to attract and retain cannabis business in the City, this Resolution
modifies tax rates established in Resolution No. 24339 for cannabis business activity
described as manufacturing, distribution and testing. More specifically, this Resolution:
1. sets a tax rate of at two cents ($0.02) of every dollar of gross receipts on
the cannabis manufacturing business of a City permittee,
2. maintains a tax rate of fifteen cents ($0.15) of every dollar of gross receipts
on the cannabis manufacturing business of any person or party operating that business
without a City permit,
3. sets a tax rate of zero cents ($0.00) of every dollar of gross receipts on the
cannabis transportation and distribution facility business of a City permittee, effectively
suspending that tax at this time, pending any reinstatement thereof under the
Ordinance,
Resolution No. 24569
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4. maintains a tax rate of fifteen cents ($0.15) of every dollar of gross receipts
on the cannabis transportation and distribution facility business of any person or party
operating that business without a City permit,
5. sets a tax rate of zero cents ($0.00) of every dollar of gross receipts on
the cannabis testing facility business of a City permittee, effectively suspending
that tax at this time, pending any reinstatement thereof under the Ordinance, and
6. maintains a tax rate of fifteen cents ($0.15) of every dollar of gross receipts
on the cannabis testing facility business of any person or party operating that business
without a City permit.
F. This Resolution shall have no effect upon the City's taxation of cannabis
business pursuant PSMC Section 3.42.040, the City's Cultivation Tax, or the provisions
of Resolution 24339 in relation to that Cultivation Tax.
G. This Resolution shall have no effect upon the City's taxation of the
operations of any cannabis business that are not manufacturing, a transportation and
distribution facility, or a testing facility.
H. The definitions contained in the Ordinance shall pertain to words or terms
used in this Resolution. For the purposes of this Resolution, the term "Tax" means the
"Gross Receipts Tax" established in the Ordinance and codified in PSMC Section
3.42.030, as administered under Resolution 24339 and under this Resolution.
THE CITY COUNCIL OF THE CITY OF PALM SPRINGS RESOLVES:
SECTION 1. The true and correct recitals above, inclusive of the defined terms
therein, are incorporated in this Resolution by this reference as the material basis for the
City Council action taken herein.
SECTION 2. Pursuantto the Ordinance, this Resolution establishes different rates
of Tax payable by different categories of cannabis business.
SECTION 3. The Tax on a cannabis manufacturing business for which the City has
issued a permit pursuant to PSMC Chapters 5.45 and 5.55, as those chapters may be
amended from time to time, which manufacturing business is regulated by PSMC Section
5.45.097 and/or Section 5.55.097, is established and shall be imposed at the rate of two
cents ($0.02) for each dollar (or portion thereof) of the gross receipts of such
manufacturing business. The Tax on permitted cannabis manufacturing businesses shall
be due and payable on or before the last business day of each month, and as provided
in PSMC Section 3.42.100.
SECTION 4. The Tax on each cannabis manufacturing business operating in the
City and which has not been issued a permit pursuant to PSMC Chapters 5.45 and 5.55,
as may be amended from time to time, is maintained and shall be imposed at the rate of
fifteen cents ($0.15) cents for each dollar (or portion thereof) of the gross receipts of such
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payable on or before the last business day of each month, and as provided in PSMC
Section 3.42.100.
SECTION 5. The Tax on a cannabis transportation and distribution facility business
for which the City has issued a permit pursuant to PSMC Chapters 5.45 and 5.55, as
those chapters may be amended from time to time, which transportation and
distribution facility business is regulated by PSMC Section 5.45.099 and/or Section
5.55.099, is established and shall be imposed at the rate of zero cents ($0.00) for each
dollar (or portion thereof) of the gross receipts of such transportation and distribution
facility business, and is thereby effectively suspended. The City affirms and specifically
reserves its authority to reinstate and resume collection of this Tax, on each cannabis
transportation and distribution facility operating in the City, pursuant to PSMC Section
3.42.030. B.
SECTION 6. The Tax on each cannabis transportation and distribution facility
operating in the City and which has not been issued a permit pursuant to PSMC Chapters
5.45 and 5.55, as may be amended from time to time, is maintained and shall be imposed
at the rate of fifteen cents ($0.15) cents for each dollar (or portion thereof) of the gross
receipts of such business. The Tax on unpermitted cannabis transportation and
distribution facility businesses shall be due and payable on or before the last business
day of each month, and as provided in PSMC Section 3.42.100.
SECTION 7. The Tax on a cannabis testing facility business for which the City has
issued a permit pursuant to PSMC Chapters 5.45 and 5.55, as those chapters may be
amended from time to time, which testing facility business is regulated by PSMC Section
5.45.098 and/or Section 5.55.098, is established and shall be imposed at the rate of zero
cents ($0.00) for each dollar (or portion thereof) of the gross receipts of such
testing facility business, and is thereby effectively suspended. The City affirms and
specifically reserves its authority to reinstate and resume collection of this Tax, on each
cannabis testing facility operating in the City, pursuant to PSMC Section 3.42.030.B.
SECTION 8. The Tax on each cannabis testing facility operating in the City and
which has not been issued a permit pursuant to PSMC Chapters 5.45 and 5.55, as may
be amended from time to time, is maintained and shall be imposed at the rate of fifteen
cents ($0.15) cents for each dollar (or portion thereof) of the gross receipts of such
business. The Tax on unpermitted cannabis testing facility businesses shall be due and
payable on or before the last business day of each month, and as provided in PSMC
Section 3.42.100.
SECTION 9. The City permits some persons and parties to operate more than a
single category of cannabis business. Some persons and parties operate more than a
single category of cannabis business without a permit. Each person or party operating
any category of cannabis business in the City that is not addressed in Sections 3 through
and including 8 hereof, with or without a permit, shall owe, and shall remain subject to
the legal duty to pay the rate of Tax upon such operation as established by Resolution
No. 24339.
Resolution No. 24569
Page 4
SECTION 10. This Resolution only modifies Tax rates. Each provision of
Resolution No. 24339 generally applicable to the collection of Tax, or addressing the
City's administration of matters in relation thereto, and not contrary to this Resolution
shall remain in full force and effect in relation to the payment of Tax hereunder.
SECTION 11. The Resolution shall be effective immediately upon adoption, and
shall apply to all Tax addressed herein commencing on March 1, 2019.
PASSED, APPROVED AND ADOPTED BY THE PALM SPRINGS CITY
COUNCIL THIS 20TH DAY OF FEBRUARY, 2019.
DAVID H. READY, E , PH.D.
ACITY MANAGER
CERTIFICATION
STATE OF CALIFORNIA )
COUNTY OF RIVERSIDE ) ss.
CITY OF PALM SPRINGS)
I, ANTHONY J. MEJIA, City Clerk of the City of Palm Springs, hereby certify that
Resolution No. 24569 is a full, true and correct copy, and was duly adopted at a regular
meeting of the City Council of the City of Palm Springs on the 20th day of February, 2019,
by the following vote:
AYES: Councilmembers Holstege, Middleton, Mayor Pro Tern Kors, and
Mayor Moon
NOES: None
ABSENT: Councilmember Roberts
ABSTAIN: None
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the
City of Palm Springs, California, this It 4" day of Via.-�-. , Lott-,
A kll�
THONY 1.
CITY CLERK