ACTION:
____________________________
Clerk/Secretary
Department: City Clerk Item No: C13
Prepared by: Kathy Valdez, City Clerk Meeting Date: November 12, 2024 Approved by: John Conley, City Manager Agenda Location: Consent Calendar SUBJECT: YEAR-END CANNABIS REVENUE POLICY
RECOMMENDATION: Adopt City Council Resolution No. 2024- , approving the adoption of City Council Policy 200-21, Cannabis Revenue Allocation.
CORRELATION TO CITY COUNCIL GOALS: Fiscal Responsibility.
PRIOR ACTION: On October 22, 2024, discussed the year-end cannabis revenue policy and directed staff to include an 80/20 split, after accounting for staff time, between extracurricular and academic scholarships (Vote: 5-0).
Please reference Exhibit 2 for a complete list of previous City Council actions.
STATEMENT ON THE SUBJECT: The first licensed cannabis businesses opened in Vista in October of 2019. Staff conservatively estimated that annual cannabis tax revenue would be $250,000 for Fiscal Year 2019/20; the actual amount was about $1.35 million. A total of $3 million was allocated in Fiscal Year 2020/21 and when that was surpassed, the amount budgeted for Fiscal Year 2021/22 was increased to $4 million. At that time, the City Council determined that the amount of cannabis revenue allocated to the general fund should be capped at $4 million annually and that remaining funds should be allocated for special projects by a vote of the City Council. In November of 2021, several ongoing projects were authorized by the City Council, requiring an increase in the amount of funds allocated to the general fund annually to maintain these services.
Over the last two months, the City Council has discussed and provided direction to staff to develop a policy to guide the annual allocation of cannabis tax revenue. The proposed City Council policy details the annual cannabis tax revenue allocation as follows:
•Sixty-five percent to the general fund, with a minimum allocation of $4,466,396 •Fifteen percent to scholarships, with 80% for extra-curricular activities and 20% for academic scholarships, after staff time is accounted for
•Twenty percent (less the amount needed to meet the minimum general fund allocation) to be allocated by majority vote of the City Council to projects requiring one-time funding FISCAL IMPACT: There is no direct fiscal impact with this discussion.
AGENDA
REPORT
CITY COUNCIL
COMMUNITY DEVELOPMENT COMMISSION
SUCCESSOR AGENCY
BUENA SANITATION DISTRICT
JOINT POWERS FINANCING AUTHORITY
Approved above recommendation, adopted City Council Resolution No. 2024-185. Vote: 4-0 (Melendez absent)
MEETING DATE: November 12, 2024 PAGE 2
SUBJECT: YEAR-END CANNABIS REVENUE POLICY
EXHIBITS:
1.City Council Resolution No. 2024- , approving the adoption of City Council Policy 200-21, Cannabis Revenue Allocation
2.Prior City Council Actions
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RESOLUTION NO. 2024-
A RESOLUTION OF THE CITY COUNCIL OF THE CHARTERED CITY OF
VISTA, CALIFORNIA, APPROVING THE ADOPTION OF CITY COUNCIL POLICY 200-21, CANNABIS TAX REVENUE ALLOCATION POLICY
The City Council the City of Vista does resolve as follows:
1. Findings. The City Council hereby finds and declares the following:
A. The City Council wishes to establish guidelines for use of annual cannabis tax revenue.
B. In response to this goal, City Council Policy 200-21 has been developed.
C. City Council Policy 200-21 describes the uses of annual cannabis tax revenue.
2. Action.
A. The City Council hereby adopts City Council Policy 200-21, Cannabis Tax Revenue Allocation, which is attached hereto and incorporated herein as Exhibit A.
B. The City Clerk shall file Exhibit A in the City Council Policy Manual.
3. Adoption. PASSED AND ADOPTED at a meeting of the Vista City Council held on November 12, 2024, by the following vote:
AYES:
NOES:
ABSTAIN:
APPROVED AS TO FORM:
WALTER CHUNG, CITY ATTORNEY
By:
JOHN FRANKLIN, MAYOR
ATTEST:
KATHY VALDEZ, CITY CLERK
By:
APPROVED
Walter C. Chung
20241104073509
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EXHIBIT 1
Vista City Council Policy
200-21 CANNABIS TAX REVENUE ALLOCATION
PURPOSE
Establish guidelines for the use of cannabis tax revenue.
POLICY
Annually, cannabis tax revenue shall be allocated as follows:
1.Sixty-five percent (65%) of total cannabis revenue shall be allocated to the general fund for general government purposes and to cover the ongoing costs of two park rangers, a sheriff’s deputy, and park restroom maintenance.
The minimum annual allocation to the general fund shall be $4,466,396.00.
2.Fifteen percent (15%) of total cannabis revenue shall be allocated to scholarships. After covering staff costs, remaining funds shall be divided between scholarships for extra-curricular activities and academic scholarships, with 80 percent going towards extra-curricular activities and 20 percent for academic scholarships. Funds for academic scholarships shall be awarded to organizations that provide academic scholarships to enable them to award additional, or larger, scholarships.
3.Twenty percent (20%) of total cannabis revenue, less the amount needed to make the minimum allocation to the general fund, shall be allocated by majority vote of the City Council to projects requiring one-time funding.
HISTORY
Adopted November 12, 2024, City Council Resolution No. 2024- . 200-21 (1)
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PRIOR CITY COUNCIL ACTIONS
On October 22, 2024, discussed the year-end cannabis revenue policy and directed staff to include an 80/20 split, after accounting for staff time, between extracurricular and academic scholarships (Vote 5-0).
On September 10, 2024, directed staff to prepare a cannabis revenue policy allocating funds as follows: 65% of revenue towards the general fund, including funds to cover previously approved positions of two Park Rangers and one Sheriff’s Deputy, and to add a new DUI Enforcement Deputy; 15% towards youth and educational scholarships; and 20% to one-time projects approved by the majority of the City Council. The policy will include a minimum allocation of $4,466,396 to the general fund (Vote: 5-0).
On August 13, 2024, adopted City Council Resolution No. 2024-141, amending the Operating Budget for Fiscal Years 2023/24 and 2024/25 (Vote: 5-0).
On November 14, 2023, adopted City Council Resolution No. 2023-202, amending Operating Budget for Fiscal Years 2023/24 and 2024/25, and amending the Capital Project Budget for Fiscal Years 2022/23 and 2023/24 (Vote: 5-0).
On November 15, 2022, received and filed the Fiscal Year 2021/22 Fourth Quarter Financial Report; adopted City Council Resolution No. 2022-172, amending the Operating Budget for Fiscal Years 2021/22 and 2022/23, and amending the Capital Project Budget for Fiscal Years 2021/22 and 2022/23; adopted Buena Sanitation District Resolution 2022-21, amending the Operating Budget for Fiscal Years 2021/22 and 2022/23 (Vote: 5-0).
On October 11, 2022, discussed allocating excess cannabis revenues and provided direction to staff (Vote: No vote).
On March 8, 2022, received and filed the Fiscal Year 2021/22 Second Quarter Financial Report; adopted City Council Resolution No. 2022-37, amending the Operating Budget for Fiscal Years 2021-22 and 2022/23; adopted City Council Resolution No. 2022-38, amending the Citywide Classification and Compensation Index; adopted Buena Sanitation District Resolution 2022-10, amending the Operating Budget for Fiscal Years 2021/22 and 2022/23 (Vote: 5-0).
On September 28, 2021, adopted City Council Resolution No. 2021-168, amending the Operating Budget for Fiscal Years 2021/22 and 2022/23 (Vote: 3-2, Contreras and Melendez Opposed).
On September 14, 2021, adopted City Council Resolution No. 2021-140, amending the Operating Budget for Fiscal Years 2021/22 and 2022/23, with the revised appropriation of the $275,000 allocated for one Sheriff’s Deputy to the Lighting Landscape and Maintenance line item (Vote: 3-0, Ritter and Green absent).
On August 24, 2021, discussed priorities for allocating excess cannabis revenues and approved funding for the following: 1) cannabis decoy and enforcement operations, 2) youth cannabis prevention and early intervention, 3) youth scholarships, 4) increased lighting in neighborhoods, 5)increased park restroom maintenance and 6) addition of one Sheriff’s deputy and two Park Directors/Enforcers (Vote on items 1-5, 5- 0; Vote on item 6: 3-2, Contreras and Melendez opposed).
On November 10, 2020, received and filed the Fiscal Year 2019/20 Fourth Quarter Financial Report and adopted City Council Resolution No. 2020-192, amending the Operating Budget for 11/12/2024 C13 5 of 6
EXHIBIT 2
PRIOR CITY COUNCIL ACTIONS
Fiscal Years 2019/20 and 2020/ 21, and amending the Capital Project Budget for Fiscal Years 2020/21 and 2021/22 (Vote: 5-0).
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