POT TAXES AND FARM PERMITS SEEK VOTER APPROVAL

Berkeley and Oakland would expand their taxation, while Richmond and
Albany consider getting into the game.

Voters in four East Bay cities will have the chance to expand the
medical cannabis industry, tax it at a greater rate, and prepare for
the possible passage of Prop 19 this November, part of a trend across
Northern California.

By the far the most dramatic measure appears in Berkeley, where a
positive business environment has lead to a sprawling industry of
three popular permitted dispensaries and countless private
collectives. Rampant indoor pot farming has emerged as an unintended
consequence of existing law, and Measure T would theoretically begin
reigning that in by permitting six indoor medical cannabis farms in
the manufacturing district. Measure T also permits residential
medical cannabis collectives to cultivate up to 200 square feet of
the herbal remedy. Additionally, the measure bumps the number of
local dispensaries up from three to four and requires they be at
least 600 feet from schools and other dispensaries.

A separate Berkeley Measure S levies a 2.5 percent sales tax, as well
as a property tax on nonprofit medical cannabis businesses. The tax
starts at $25 per square foot for the first 3,000 square feet and $10
per square foot thereafter. Measure S also prepares Berkeley for the
possible passage of Prop 19 - the Regulate, Control and Tax Cannabis
Act - with a 10 percent sales tax on non-medical cannabis.

Just to the south, the City of Oakland similarly prepares to tax and
regulate pot if homegrown Prop 19 passes. A 10 percent recreational
sales tax is included in Oakland's Measure V. Measure V would also
raise medical cannabis business taxes from $18 per $1,000 to $50 per
$1,000 of gross receipts. Dispensaries have come out against what
would be the third increase in their sales taxes, saying taxes cut
into services. This fall, the Oakland City Council continues to work
on possibly permitting four large-scale cultivation sites without a
ballot measure.

Up in Richmond, the council also sent the voters a Measure V, which
would mandate "every person" engaged in a marijuana business pay a
general business license tax of 5 percent of gross receipts. The tax
comes after the City of Richmond banned dispensaries, sued the
existing ones out of business, and then created permits for three in the city.

Finally, the City of Albany - which has no permitted dispensaries yet
- - would get in the game with Measure Q, which would create a business
license tax for local cannabis enterprises. For-profits in Albany
would pay $25 per $1,000 gross receipts, while Albany nonprofits
would pay $25 per square foot of space for all businesses owned,
rented, leased, or otherwise occupied.