California – Fullerton City Council to Discuss Sales Tax and Cannabis at its July 7 Meeting

Needing to fill in millions of dollars of a deficit that could grow even larger, Fullerton leaders are looking at putting a city sales tax up for voters’ consideration in November and legalizing cannabis manufacturing and dispensaries.

Even before the coronavirus pandemic hammered the city’s revenue sources such as sales and hotel taxes, Fullerton officials had said they need more money in the budget, especially to fix streets that are considered among the worst in Orange County. Fullerton has about $150 million worth of street improvements that need to be made, officials said.

The pandemic – which squeezed Fullerton to the tune of an $8 million for the 2020-21 fiscal year that started July 1 – only increased the city’s urgency in seeking some alternate sources of revenue, officials said.

Officials estimate a 1.25% city sales tax, which would mean a rate of 9% on goods bought in Fullerton when added to current taxes, would generate $25 million annually for the city. The revenue would fund infrastructure improvements, homeless initiatives and programs such as community policing and crime prevention services, officials said.

Four out of five council members would need to vote in favor of putting the sales tax measure on the November ballot.

The council will also discuss how and whether to have city staffers move forward on drafting new laws that would pave the way for cannabis manufacturing, distribution, testing and cultivation businesses and retail shops such as dispensaries to open in Fullerton.

The city would likely cap each segment, except testing, at five businesses that could get permits. Businesses would be allowed in industrial areas, which are concentrated in the southeastern and western portions of the city. Retail shops would be allowed in areas zoned for commercial use. Businesses would have to be at least 600 feet from schools and parks.

The discussion comes after three community meetings where city officials heard residents’ thoughts on legalizing commercial cannabis activities.

The council has been split over introducing commercial cannabis to the city. Some see it as a way to crack down on the illicit market, provide oversight and regulations and generate some revenue. Others think legalizing inviting cannabis-related businesses will further promote use in the community.

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The Orange County Register
BY Jeong Park 
July 6, 2020