City Council
City of Visalia
Monday, March 3, 2025
Cannabis Business Ordinance Next Steps
In November 2024, voters of the City of Visalia voted to approve Measure O, the City’s cannabis tax measure, with an approval rate of 70.7%. Major elements of the cannabis business tax ordinance include:
• It is a general tax for general purpose of the city
• The maximum tax rate is 10% of gross receipts
• Taxes are to be remitted monthly
• Audits will be allowed by the city or third-party designee • Personal cultivation for personal consumption is not subject to the tax • The option for a tax rate per square footage for cultivation businesses Cannabis Business Next Steps:
Passage of the local tax measure does not legalize other types of cannabis sales to operate in the City of Visalia, just to tax applicable businesses.
The City has an existing service agreement with HdL Companies that includes identifying potential revisions to cannabis regulations in Visalia, or drafting a new regulatory framework for cannabis business operations should the City wish to proceed with that potential scope of work.
Depending on Council direction, staff is requesting an appropriation of an additional $5,000 from the General Fund and to amend the HdL contract.
Cannabis Business Next Steps:
1. Proceed with drafting a cannabis business ordinance for adoption but set the number of businesses permitted to operate in the City to zero effectively establishing the regulatory framework but not yet permitting such businesses to operate.
2.Proceed with drafting a cannabis business ordinance and potentially allowing such businesses to operate within the City upon adoption of the ordinance.
3.Do not proceed with drafting a cannabis business ordinance and instead acquire cannabis ordinance examples and a conceptual work plan from HdL for potential use at a later time.
Cannabis Business Next Step Options:
3.14.170 Apportionment.
This section in the Cannabis Tax Ordinance could potentially yield tax revenues on deliveries currently allowed into Visalia from dispensaries located outside of Visalia.To fully implement this provision, staff needs to:
Determine an appropriate apportionment formula
Establish a policy
Identify potential businesses this should apply to
HdL, City staff, and the City Attorney’s Office are currently working to develop this type of process.
Cannabis Business Next Steps:
Background
FM3 Research was hired to conduct public opinion research on a potential local cannabis tax measure.
On May 6th FM3 Research presented their survey findings and identified, among other things, that the majority of Visalia residents support allowing cannabis businesses to operate in Visalia and support the passage of a local tax measure on cannabis businesses.
Background
Background
Background
That the City Council select one of the following options:
1. Proceed with drafting a cannabis business ordinance for adoption but set the number of businesses permitted to operate in the City to zero effectively establishing the regulatory framework but not yet permitting such businesses to operate within the City, amend the remaining HdL contract totaling $24,600, and appropriate $5,000 from the General Fund.
2.Proceed with drafting a cannabis business ordinance and potentially allow such businesses to operate within the City upon adoption of the ordinance, amend the remaining HdL contract totaling $24,600, and appropriate $5,000 from the General Fund.
Staff Recommendation
Comments/Questions