Chapter 5.14
CANNABIS BUSINESS TAX*
Sections:
5.14.020 Cannabis business tax.
* Code reviser’s note: This chapter is a city council sponsored initiative ordinance that shall only be amended by the qualified voters of the city as provided in Section 5.14.020(I).
5.14.010 Definitions.
For the purpose of this chapter, the following words and phrases shall have the meanings respectively ascribed to them by this section:
“Business” means professions, trades, occupations, gainful activities, and all and every kind of calling whether or not carried on for profit.
“Cannabis” or “marijuana” has the meaning as defined in California Health and Safety Code Section 11018.
“Cannabis business” means any business activity involving the commercial cultivation, distribution and exchange of cannabis, including but not limited to the planting, cultivation, harvesting, transporting, manufacturing, compounding, converting, processing, preparing, storing, packaging, providing, wholesale and retail sales, whether fixed, mobile, permanent or temporary, where cannabis is made available, sold, given, distributed, or otherwise provided in accordance with the existing laws of the state of California, whether for medical or nonmedical reasons.
“City” means the city of Patterson, a municipal corporation of the state of California, in its present incorporated form or in any later reorganized, consolidated, enlarged or reincorporated form.
“Collector” means the director of finance or other city officer or employee charged with the administration of this chapter.
“Fixed place of business” means the premises occupied in the city for the particular purpose of conducting a business there and regularly kept open for that purpose with a competent person in attendance for the purpose of attending to such business.
“Gross receipts” means the total amount charged or received for the performance of any act, service or employment of whatever nature it may be, whether or not such service, act or employment is done as a part of or in connection with the sale of goods, wares, or merchandise, for which a charge is made or credit allowed. Gross receipts shall be calculated without any deduction on account of any of the following: (A) the cost of tangible property sold or bartered; (B) the cost of materials or products used, labor or service cost, interest paid, losses, or other expense; or (C) transportation costs.
“Person” means all domestic and foreign corporations, associations, syndicates, joint stock corporations, partnerships of every kind, clubs, business or common law trusts, societies and individuals transacting and carrying on any business in the city.
“Reporting period” means a year, quarter or calendar month, as determined by the collector. (Ord. 819 § 1, 2018 (Measure Y, adopted at November 6, 2018 election)).
5.14.020 Cannabis business tax.
A. Every person engaged in a cannabis business shall pay an annual business license tax of up to fifteen cents for each one dollar of gross receipts, regardless whether the city has authorized the cannabis business.
B. The tax rate shall be set by resolution of the city council. The city council may, in its discretion, implement such cannabis business tax rate it deems appropriate, and may by resolution increase or lower such tax rate from time to time; provided, that the cannabis business tax shall not exceed fifteen cents for each one dollar of gross receipts.
C. Any tax adopted by the city council pursuant to this chapter shall apply only to those cannabis businesses operating outside the scope of a development agreement approved by the city council. However, the tax may apply to all cannabis businesses in the event the City council cancels the cannabis pilot program.
D. The collector shall establish reporting periods for the periodic collection of gross receipts. The reporting period may fall under yearly, quarterly, or monthly reporting, or any reasonable reporting period established by the collector.
E. Failure to pay the cannabis business tax shall be subject to penalties, interest charges, and assessments as the city council may establish by resolution, and the city may use any and all code enforcement remedies available at law to collect such payments.
F. The payment of the cannabis business tax shall not be construed as authorizing the conduct or continuance of any illegal business or of a legal business in an illegal manner. Nothing in this section shall be applied or construed as authorizing the sale of cannabis.
G. The collector or his or her designee shall annually audit any cannabis business taxes imposed by this section to verify that tax revenues have been properly expended in accordance with the law.
H. The cannabis business tax is not a sales tax and shall not be assessed as such.
I. This section was submitted to the qualified voters of the city for approval. Any amendment to the maximum tax rate therefore may not become effective until such amendment is approved by the voters. The voters expressly authorize the city council to amend, modify, change or revise any other provisions of this section as the city council deems in the best interest of the city. The city council or city manager may promulgate rules, regulations and procedures to implement this section and to ensure the efficient and timely collection of any taxes or any related penalties imposed by this section. (Ord. 819 § 1, 2018 (Measure Y, adopted at November 6, 2018 election)).