Cannabis
Study Session
Prepared by: City Manager’s Office
November 14, 2025
AGENDA
•BACKGROUND
•CURRENT STATUS OF CANNABIS INDUSTRY
•CANNABIS TAX RATES
•CANNABIS PERMIT FEES
•APPLICATION REQUIREMENTS
•EXISTING CUPs
•RECOMMENDATIONS/DISCUSSION
BACKGROUND
March 2017, voters
approved Measure B(with
74% margin) a cannabis tax
–BMC §3.37.060
Reso 17-44 (August)
established application
requirements and minimum
qualifications. December
2017, the City Council
began issuing medical
cannabis business permits
(MCBPs)
August 2019, the City
Council approved
permittees with existing
MCBPs to convert to
recreational CBPs. All
MCBPs were converted.
September 2020, City
Council reduced cannabis
business tax rates for
manufacturing and
distribution from 7.5% to
2% and 1%, respectively,
and suspended annual
increases for all cannabis
tax rates (Resolution 20-63)
June 2021, City Council
reviewed the tax rates for
dispensaries and
suspended the tax
increase for dispensaries.
Set rate at 8.5%
(Resolution 21-35)
Reso. 23-18 –Updated
policies and procedures
for obtaining, modifying,
and maintaining CBPs
2025-City Council
adopts Strategic Plan
&
Deli by Caliva
receivership
CURRENT STATUS OF CANNABIS INDUSTRY
•Growing competition from the unregulated market
•Broad consolidation (strategic alliances; merger & acquisitions) in the industry •Established alcohol & tobacco companies are entering the industry •(Federal) Bank regulations continue to hamper growth; limited access to financial institutions •Federal (DEA)/ State(DCC)
•AB 564 –repealed cannabis excise tax increase through 2028. •Cities reevaluating cannabis taxes & fees
CANNABIS TAX RATES
Bellflower (FY 25-26):
Cultivation
(Non-nursery): $26.79/sqft (Nursery): $5.36/sqft
Dispensary: 8.5%
Distribution: 1%
Manufacturing: 2%
Cannabis Testing: 10%
Cultivation Tax Rate Comparison
$0
$5
$10
$15
$20
$25
$30
Long Beach Culver City Pasadena Stanton Pomona Average Bellflower Cultivation Tax Rates –per sqft.
BELLFLOWER CULTIVATION RATES (2017-2025)
$-
$5.00
$10.00
$15.00
$20.00
$25.00
$30.00
FY 17-18 FY 18-19 FY19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 FY 24-25 FY 25-26
Cultivation Tax Rate Comparison
0%
1%
2%
3%
4%
5%
6%
7%
Los Angeles Maywood Santa Ana El Monte Lancaster Hawthorne Average Cultivation Tax Rate % of Gross Sales
Retail Tax Rate Comparison
0%
2%
4%
6%
8%
10%
12%
Long Beach Los Angeles Maywood Santa Ana Costa Mesa Culver City Pasadena El Monte Stanton Lancaster Artesia Pomona Covina Hawthorne Average Bellflower
Distribution Tax Rate Comparison
0%
1%
2%
3%
4%
5%
6%
7%
8%
Culver City, Desert Hot Springs, Cathedral City – 0% distribution tax rates.
Bellflower
Artesia
El Monte
Costa Mesa
Stanton
Santa Ana
Los Angeles
Lancaster
Average
Pasadena
Pomona
Culver City
Hawthorne
Covina
Long Beach
Maywood
$0.00
$5,000.00
$10,000.00
$15,000.00
$20,000.00
$25,000.00
$30,000.00
$35,000.00
$40,000.00
New CBP Application Fee
Bellflower Costa Mesa Maywood Santa Ana El Monte Artesia Pasadena Average Culver City Hawthorne Los Angeles Pomona Covina Long Beach Stanton Lancaster $0
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
$35,000
$40,000
Annual CBP Fee
*Bellflower’s numbers exclude the $6,357 renewal fee and $5,000 drug rehabilitation program fee
APPLICATION REQUIREMENTS
•CUP (Pre-requisite to CBP)
•CBP Application (Reso. 23-18 & BMC)
•Cannabis License with Department of Cannabis Control
•Ongoing Annual Renewal(s) – Local & State
CUP MAP
Existing CUP – No CBP
(Clark & Somerset = 1 CUP)
Existing CUP – Current CBP
Existing CUP - Former Deli by Caliva
(9535 Artesia Blvd)
9/12 CUPs Issued (BMC § 17.94.040)
8/22 CBPs Issued (Reso. 23-18)
3/4 Dispensary CBPs Issued
RECOMMENDATIONS
1.Review all cannabis tax rates & CBP fees – especially distribution and cultivation
2.Consider reviewing the maximum cannabis-related CUPs/CBPs & dispensaries in the City
3.After consideration and review, update and consolidate cannabis-resolutions (taxes, fees, requirements & standards) and (if necessary) adjustments to the BMC & streamline application process.
THANK YOU.