HomeMy WebLinkAboutED Cannabis Special Tax Election____________________________________________________________________________________
FOR CITY CLERK ONLY
File No.: 9-4 x 287
Council Meeting: 3/05/2018
Disposition: Resolution 14477 (as amended)
Agenda Item No: 6.b
Meeting Date: March 5, 2018
SAN RAFAEL CITY COUNCIL AGENDA REPORT
Department: Economic Development
Prepared by: Danielle O’Leary,
Econ. Development Director
City Manager Approval: ______________
TOPIC: SPECIAL ELECTION FOR VOTER APPROVAL OF SAN RAFAEL CANNABIS
BUSINESS TAX
SUBJECT: RESOLUTION CALLING FOR A SPECIAL MUNICIPAL ELECTION TO BE HELD ON
JUNE 5, 2018;ORDERING THE SUBMISSION TO THE QUALIFIED VOTERS OF THE
CITY OF SAN RAFAEL AT THAT ELECTION OF A BALLOT MEASURE TO LEVY A
COMMERCIAL CANNABIS INDUSTRY SPECIAL TAX; REQUESTING ELECTION
SERVICES; AND SETTING THE INITIAL CANNABIS INDUSTRY TAX RATES
SHOULD THE PROPOSED BALLOT MEASURE PASS ON JUNE 5, 2018,
RECOMMENDATIONS:
Approve the form of proposed cannabis industry tax ordinance, and adopt resolution to call a special
election to be held on Tuesday, June 5, 2018 for the purpose of submitting that tax measure to San
Rafael voters; requesting election consolidation and services from the County of Marin, directing the
City Attorney to provide an impartial analysis, and setting the initial cannabis tax rates to be proposed
should the tax measure pass.
BACKGROUND:
On November 5, 1996, the California State election passed ballot measure Proposition 215 , known as
the “Compassionate Use Act,” legalizing medical use of cannabis. In September, 2015, the State
enacted the Medical Cannabis Regulation and Safety Act (“MCRSA”), establishing a state licensing
framework and authorizing local regulation of medicinal cannabis. The City of San Rafael has
prohibited medical cannabis dispensaries since 1997 and since that time, no cannabis businesses have
been permitted in City limits.
On November 8, 2016, the California State election passed ballot measure Proposition 64 , known as
the “Adult Use of Marijuana Act” or “AUMA.” Proposition 64 legalizes adult recreational use of
cannabis, brings businesses that support adult recreational cannabis use into a regulated market, and
allows the City of San Rafael to enact local regulations on such businesses in addition to the
regulations that will be imposed by the State.
SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 2
City Staff Review:
In response to the election results of Proposition 64, the San Rafael City Council, at a January 2017
study session, reviewed the statutory law of AUMA and instructed staff to form a City Council ad-hoc
subcommittee to review San Rafael’s cannabis policies. A decision was made to pursue limited industry
segments of medicinal cannabis and resulted in the formation of t he Medical Cannabis Council Ad-Hoc
Subcommittee (MC Subcommittee) which included Councilmember Kate Colin and Councilmember
John Gamblin. Staff support included the: City Manager, Police Chief, Fire Chief, Community
Development Director, Assistant City Attorney, and the Economic Development Director. Over the
course of several months, the subcommittee reviewed all license types available under the State’s
medical cannabis framework.
In July 2017, the Governor signed Senate Bill 94, entitled the Medical and Adult-Use Cannabis
Regulation and Safety Act (“MAUCRSA”), which took effect immediately. MAUCRSA reconciles the
State’s MCRSA with AUMA’s nonmedical/recreation adult-use cannabis regulations. The State issued
the newly revised regulations on November 16, 2017 under their emergency rule making process.
Urgency Cannabis Ordinance:
On December 4, 2017, Council adopted Ordinance No. 1949 (the “Cannabis Urgency Ordinance”), an
urgency ordinance adding new Chapter 10.96 to the San Rafael Municipal Code to advance local
regulations for commercial cannabis activity in San Rafael city limits before the State of California’s
January 1, 2018 start date for accepting commercial cannabis applications.
The Cannabis Urgency Ordinance establishes the following regulations:
Permits Medical Cannabis Commercial Operations
Authorizes a limited number of commercial medical cannabis operator licenses:
• Medical cannabis delivery (State License Type 9)
• Medical cannabis infused product manufacturing (State License - Type N)
• Cannabis testing lab (State License – Type 8)
Prohibits Medical Cannabis Commercial Operations
• Cultivation, processing and some manufacturing activities
• Dispensaries, specifically retail store fronts
Prohibits Nonmedical/Recreational Adult-use Cannabis Commercial Operations
• All commercial nonmedical/recreational adult-use cannabis activities allowed under
AUMA pending further staff reviews of the State’s new MAUCRSA regulations.
Medical Cannabis Business (“MCB”) Resolution
On January 16, 2018, the Council approved a resolution outlining available license amounts that would
be available under the pilot cannabis operator licensing program:
• Cannabis Testing Labs (State License Type 8): 4 licenses
• Medical Cannabis Infused Products Manufacturing (State License Type N): 8 licenses
• Medical Cannabis Delivery (State License Type 9): 4 licenses
The MC Subcommittee also reviewed the MCB operator license application, which includes a selection
process and eligibility ranking. The MCB operator license application and renewal fees are based on a
cost-recovery model for application intake. All costs are calculated using the fully burdened rates
(salary + benefits) of the respective departments involved with the licensing process.
SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 3
Cannabis Zoning Recommendations
On February 13, 2018, the Planning Commission reviewed staff recommendations to amend Title 14 of
the San Rafael Municipal Code (Zoning Ordinance) by:
1.) Adding definitions, land-use provisions and parking requirements for cannabis businesses within
city limits, specifically medical cannabis delivery, medical cannabis infused product
manufacturing, and cannabis testing laboratories.
2.) Clarifying prohibition on cultivation for agricultural uses in the W etland Overlay District.
3.) Prohibiting non-medical cannabis businesses.
4.) Amending Home Occupation Standards.
ANALYSIS:
Call for Special Election: With the enactment of MAUCRSA, the passing of Proposition 64 and the
City’s support in exploring a pilot cannabis licensing program, the City will incur costs to regulate newly-
legalized cannabis businesses, including considering, adopting and enforcing regulations, administering
operator licensing, providing for business inspections, ensuring public safety is responsive to the
public, providing economic development analysis and review to support policy decisions and
education/outreach to the industry, and providing information and educational materials to the
community.
The City’s current business tax ordinance, which applies to all businesses operating in San Rafael,
does not allow the City to generate enough revenue to support the unique needs of this emerging
industry as described above. In order to pay for the expected costs of authorizing and regulating
cannabis businesses, staff recommends that the Council submit an ordinance to the voters that would
impose a local business tax on the cannabis industry, rather than the City’s existing general business
tax. As proposed by staff, the cannabis tax ordinance would authorize the Council to set appropriate
tax rates, subject to specified caps, sufficient to cover the costs to the City of allowing this emerging
industry to operate in San Rafael and to pay for other specified City services and costs. Staff
recommends that Council, by resolution, call a special municipal election for June 5, 2018 to submit the
proposed tax measure to the voters.
The proposed tax would be a special tax requiring two-thirds voter approval, with the proceeds
dedicated to specific uses. The proposed ordinance would dedicate the tax proceeds to paying the
City’s costs in administering its cannabis regulations, and to enhance police and fire services, as
described above, but would also provide that the tax proceeds may be used for enhancing community
centers and repairing potholes/ maintaining City streets.
On February 13, 2018, the Council appointed ad-hoc MC Subcommittee reviewed and recommended
the proposed cannabis tax measure and abbreviated ballot language, to be subject to full Council
approval on March 5, 2018. The proposed measure will be abbreviated on the ballot as follows:
“To maintain/enhance City of San Rafael services, with funding that cannot be taken by
Sacramento, including: enhancing police and fire services; repairing potholes/maintaining
streets; enhancing community centers; and administering a cannabis oversight program; shall
the City of San Rafael’s ordinance levying, until repealed, a tax of up to 8% on cannabis
(marijuana) businesses’ gross receipts in the city, providing approximately $1,000,000 annually,
requiring independent citizen oversight, financial audits, and that all funds stay in San Rafael, be
adopted?”
SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 4
A resolution to call the special election and request the necessary election-related services, is attached
as Attachment 1 to this report. The ordinance to be submitted to the voters for approval is attached as
Attachment A to the resolution.
Major Components of Tax Ordinance: The proposed ordinance would authorize the City Council to
implement a business tax on commercial cannabis businesses of up to 8% of gross receipts, with the
proceeds to be used for the purposes set forth above. However, the City recognizes the volatility of the
newly-legalized cannabis market, and both staff, Council representatives from the MC Subcommittee
and San Rafael’s first responders recommend adoption of limited initial tax rates to balance the
financial needs of the City with its desire to support this industry and the viability of the industry itself.
With the uncertainty of the evolving industry both at the local and state level, it is recommended that
Council retain flexibility to ensure a sustainable and responsible approach to management of cannabis
businesses in our community.
Under the proposed ballot measure, the Council will have the authority to adjust tax rates by resolution
every two years, but not to exceed the maximum rates authorized by the voters. Setting a rate for
multiple years provides greater certainty to the industry and will allow for the collection of data and
information to inform the Council for any potential rate changes in the future . The proposed measure
permits Council the discretion to set different tax rates for cannabis businesses within the supply chain.
The resolution attached as Attachment 1, in addition to calling the special election, would set the initial
tax rates to go into effect if the ballot measure passes on June 5, 2018. The initial rates proposed are
as follows:
• Infused Products Manufacturing: 3% of gross receipts
• Delivery, non-storefront retail: 4% of gross receipts
• Cannabis Testing Labs: 1% of gross receipts
• Distribution: 1% of gross receipts
The City recognizes that businesses will be bearing many initial costs as they adjust to the new legal
environment and adhere to State of California regulations. As such, imposed tax rates are intended to
secure funding for the needs of the community, while not overburdening the market. Staff will continue
to monitor the economic impact of the industry and its effect on overall business climate in the city to
evaluate and report to Council. In the coming years, tracking and tracing industry trends will provide
crucial data on gross revenues generated at various points within the supply chain, thereby enabling
Council to better inform what taxation rates are the most appropriate.
Finally, to give the Council the ability to make future adjustments to the implementation and
enforcement provisions of its business tax provisions, and to respond to changes in state law governing
the businesses operating in San Rafael, without putting additional measures on the ballot, the proposed
ordinance gives the Council the authority to adopt, by resolution, limited changes to cannabis industry
tax provisions, so long as no changes are made to the tax rates authorized by voters.
FISCAL IMPACT:
If the tax measure passes, the City would only collect a small portion of tax revenue in the first year as
most of the businesses would be in start-up phase or still going through the City’s licensing process and
building permit approval process. The cost estimated for the special election are $1.75 - $3.00 per
registered voter, which would range from $52,024 to $89,184.
SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 5
ENVIRONMENTAL IMPACT:
This action is exempt from the California Environmental Quality Act (CEQA) because it is not a project
which has potential for resulting in either a direct physical change in the environment, or a reasonably
foreseeable indirect physical change to the environment, pursuant to CEQA Guideline section 15378.
OPTIONS:
The City Council has the following options to consider on this matter:
1. Adopt Resolution with proposed Cannabis Industry Tax measure as presented.
2. Adopt Resolution and proposed Cannabis Industry Tax measure with modifications.
3. Provide feedback on Resolution and proposed Cannabis Industry Tax measure and direct staff
to return with more information, which would preclude the ability to have an item on the June 5th
ballot.
4. Take no action.
RECOMMENDED ACTION:
Adopt the attached resolution to order a special election to be held on Tuesday, June 5, 2018 for the
purpose of submitting to San Rafael voters an ordinance to impose a business tax on cannabis
businesses, request election services, and set the initial tax rates for a 2-year term to go into effect if
the measure passes.
ATTACHMENTS
1. Resolution Calling Special Municipal Election on June 5, 2018, with Attachment A- Cannabis
Industry Tax measure
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RESOLUTION NO. 14477
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN RAFAEL:
1) CALLING A SPECIAL MUNICIPAL ELECTION TO BE HELD ON
TUESDAY JUNE 5, 2018; AND
2) ORDERING THE SUBMISSION OF A PROPOSITION OF LEVYING A
SPECIAL COMMERCIAL CANNABIS BUSINESS TAX TO THE
QUALIFIED VOTERS OF THE CITY OF SAN RAFAEL AT THE
SPECIAL MUNICIPAL ELECTION TO BE HELD ON JUNE 5, 2018;
AND
3) REQUESTING CONSOLIDATION WITH ANY OTHER ELECTION
CONDUCTED ON THE SAME DATE; AND
4) REQUESTING ELECTION SERVICES BY THE REGISTRAR OF
VOTERS; AND
5) REQUESTING THE CITY ATTORNEY TO PREPARE AN IMPARTIAL
ANALYSIS OF THE MEASURE; AND
6) SETTING THE INITIAL CANNABIS BUSINESS TAX RATES
SHOULD THE PROPOSED BALLOT MEASURE PASS ON JUNE 5,
2018.
WHEREAS, the Charter of the City of San Rafael, Article IV, Section 1,
authorizes the City Council to call a special municipal election; and
WHEREAS, on November 5, 1996, the California Voters enacted Proposition
215 to legalize medical use of cannabis, and in October 2015, the Governor signed into
law the Medical Marijuana Regulation and Safety Act (now known as the Medical
Cannabis Regulation and Safety Act or MCRSA), establishing a state licensing
framework and authorizing local regulation of the medical cannabis industry; and
WHEREAS, on November 8, 2016, California voters enacted Proposition 64 to
legalize adult recreational use of cannabis and to allow businesses that support such
cannabis use to operate legally, subject to regulations imposed by state and local public
entities; and
WHEREAS, for the past year, the City of San Rafael’s Medical Cannabis Ad-Hoc
Subcommittee has been working to develop local regulatory policies; and
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WHEREAS, the permitting and support of this industry, in association with the
earlier Passage of Proposition 215, and the recent enactment of MCRSA and passage
of Proposition 64, has significant cost implications for the City of San Rafael due to the
cost of adopting and implementing new regulations to govern this new industry,
enforcing these regulations, ensuring public saf ety, and providing economic
development services; and
WHEREAS, the City’s existing general business tax ordinance, which generally
levies a limited business tax on all businesses operating in San Rafael, is insufficient to
generate the volume of revenue needed to pay the City’s costs of allowing the new and
unique cannabis industry to operate in San Rafael ; and
WHEREAS, adopting such a local cannabis industry business special tax
measure in the City of San Rafael will benefit residents of the City by ensu ring that
cannabis businesses contribute to pay towards the costs associated with allowing this
emerging industry to operate in San Rafael, while allowing the City to continue to
maintain stable funding for essential City services and continued quality of life; and
WHEREAS, the City recognizes the volatility of the newly-legalized cannabis
market and will therefore set limited initial tax rates to balance the financial needs of the
City and the desire of the City to support and encourage the industry to en gage in a
regulated market; and
WHEREAS, such a measure will provide locally-controlled revenue that cannot
be taken by the State; and
WHEREAS, such a measure will help to maintain the City’s long-term financial
stability, with public oversight and annual fiscal reviews; and
WHEREAS the City Council of the City of San Rafael may request the Board of
Supervisors of the County of Marin to consolidate the special municipal election with
any other election conducted on the same date; and
3
WHEREAS, the City Council of the City of San Rafael may request election
services by the County Clerk of Marin County, California;
NOW THEREFORE, BE IT RESOLVED that pursuant to the requirements of the
laws of the State of California there is called and ordered held in the C ity of San Rafael,
County of Marin, State of California, on Tuesday, June 5, 2018, a special municipal
election of the qualified electors of San Rafael, for the purpose of submitting to the
electors of the City a proposition of levying a Special Cannabis Industry Business Tax.
BE IT FURTHER RESOLVED that there shall be submitted to the voters of the
City at the special municipal election to be held on June 5, 2018 the proposition
attached hereto as Attachment “A” and incorporated herein by reference, to be known
and referred to as the “SAN RAFAEL SPECIAL CANNABIS BUSINESS TAX
MEASURE” or as “Measure ___”. [designation to be assigned by County Registrar of
Voters]
BE IT FURTHER RESOLVED that pursuant to Section 13247 of the Elections
Code, the Council hereby directs the Registrar of Voters to use the following
abbreviation of the tax proposition on the ballot:
“To maintain/enhance City of San Rafael services, with funding that
cannot be taken by Sacramento, including: enhancing police and fire
services, repairing potholes/maintaining streets, enhancing
community centers, and administering a cannabis oversight
program; shall the City of San Rafael’s ordinance levying, until
repealed, a tax of up to 8% on cannabis (marijuana) businesses’
gross receipts in the city, eventually ramping up to approximately
$1,000,000 in new funding annually,requiring independent citizen
oversight and financial audits be adopted?”
YES
NO
_____
BE IT FURTHER RESOLVED that the Registrar of Voters of the County is
hereby requested to reprint the full text of the proposition, which is all that portion of this
Resolution set forth in Attachment A, in the voter information pamphlet to be distributed
to voters pursuant to Section 13307 of the Elections Code. In the event the fu ll text of
the proposition is not reprinted in the voter information pamphlet, the Registrar of
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Voters is hereby requested to print, immediately below the impartial analysis of the tax
proposition, in no less than 10-point boldface type, a legend substantially as follows:
“The above statement is an impartial analysis of
Measure ___. If you desire a copy of the measure, please
call the San Rafael City Clerk at 415-485-3065 and a copy
will be mailed at no cost to you.”
BE IT FURTHER RESOLVED that the Board of Supervisors of the County of
Marin, is hereby requested to:
1. Consolidate said election with any other election conducted on the same
day; and
2. Authorize and direct the County Clerk, at City expense, to provide the
following election services and to canvass the results of said election:
▪ Provide Voter Indexes
▪ Provide Voter Count by Precinct
▪ Provide Drayage and Rental of Polling Places
▪ Provide Printing of Sample and Official Ballots
▪ Provide Printing of Measures and Arguments
▪ Appoint and Notify Election Officers
▪ Mail Sample Ballots and Polling Place Notification
▪ Provide Precinct Supplies
▪ Provide Training of Precinct Workers
▪ Provide Processing of Vote by Mail Ballots
▪ Provide Central Counting
▪ Provide Canvass of Votes Cast
▪ Provide such other services as are necessary to conduct the Special
Municipal Election
BE IT FURTHER RESOLVED that:
1. The ballots to be used at the election shall be in both form and content as
required by law.
2. The polls for said election shall be opened at seven o’clock (7:00 a.m.) on
the day of said election and shall remain open continuously from said time until 8:00
5
o’clock (8:00 p.m.) of the same day when said polls shall be closed, except as provided
in Section 14401 of the Elections Code of the State of California.
3. In all particulars not recited in this Resolution, the election shall be held
and conducted as provided by law for holding special municipal elections in said City.
4. Notice of the time and place of holding the election is hereby given and
the City Clerk is hereby authorized, instructed and directed to give such further or
additional notice of said election in time, form, and manner as required by law.
5. Pursuant to Elections Code section 9285, the City Council of the City of
San Rafael hereby directs the City Clerk to accept rebuttal arguments submitted to the
Clerk within ten (10) days after the final date for filing direct arguments.
6. Pursuant to California Elections Code Section 9280, the City Council of
the City of San Rafael hereby directs the City Attorney to prepare an impartial analysis
of said ballot Measure.
7. The City of San Rafael recognizes that additional costs will be incurred by
the County by reason of this consolidation and agrees to reimburse the County for any
costs.
8. Initial cannabis business tax rates, should the proposed ballot initiative
pass on June 5, 2018, shall be set as follows for a term of 2 years beginning the day
the Ordinance goes into effect:
A. Cannabis Infused Products: 3% of gross receipts
B. Delivery Non-Storefront Retail: 4% of gross receipts
C. Cannabis Testing Labs: 1%
D. Cannabis Distribution: 1%
9. This Resolution shall be effective immediately upon its adoption by the
City Council.
10. The City Clerk is directed to submit a certified copy of this Resolution to
the Board of Supervisors of the County of Marin.
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I, LINDSAY LARA, Clerk of the City of San Rafael, hereby certify that the
foregoing Resolution was duly and regularly introduced and adopted at a regular
meeting of the City Council of said City held on the Monday, the 5th day of March, 2018
by the following vote, to wit:
AYES: COUNCILMEMBERS: Bushey, Colin, Gamblin, McCullough & Mayor Phillips
NOES: COUNCILMEMBERS: None
ABSENT: COUNCILMEMBERS: None
____________________________________
LINDSAY LARA, City Clerk
ATTACHMENT “A” – FULL TEXT OF MEASURE
ORDINANCE NO. _______
AN ORDINANCE OF CITY OF SAN RAFAEL ADDING CHAPTER 3.40 TO THE SAN
RAFAEL MUNICIPAL CODE ENTITLED “CANNABIS INDUSTRY TAX.”
THE PEOPLE OF THE CITY OF SAN RAFAEL DO ORDAIN AS FOLLOWS:
DIVISION 1. Chapter 3.40 is hereby added to the San Rafael Municipal Code to read as
follows:
CHAPTER 3.40 CANNABIS INDUSTRY TAX
3.40.010. Title. This ordinance shall be known as the Cannabis Industry Tax Ordinance.
3.40.020. Special Excise Tax. A special excise tax is imposed by this Chapter for funds to
enhance police and fire services; repair potholes and maintain City streets; enhance City
community centers; and administer a cannabis business regulation and oversight program.
3.40.030. Purpose. This ordinance is adopted to achieve the following purposes, among others,
and shall be interpreted to accomplish those purposes:
A. To impose a special business tax on businesses engaged in the cannabis industry operating
within the City of San Rafael pursuant to the state Medicinal and Adult Use Cannabis
Regulation and Safety Act (“MAUCRSA”), specifically California Business and Professions Code
section 19320 and the "California Control, Regulate and Tax Adult Use of Marijuana Initiative"
approved by the state’s voters on November 8, 2016.
B. To specify the type of tax and maximum rate of tax that may be levied and the method of
collection; and
C. To comply with all requirements to impose a special excise tax, such tax to become operative
only if and to the extent implemented by the City Council by resolution and approved by 2/3
voter approval.
3.40.040. Definitions. Terms that are not defined in this Chapter shall have the meanings
ascribed to them in Section10.96.040 of the San Rafael Municipal Code. The following words
and phrases shall have the meanings set forth below when used in this Chapter unless the
context plainly requires otherwise:
A. “Licensee" as that term is defined in Section 10.96.040 of the San Rafael City Code.
B. “Cannabis" means all parts of the plant Cannabis sativa Linnaeus, Cannabis indica, or
Cannabis ruderalis, or any other strain or varietal of the genus Cannabis that may exist
or hereafter be discovered or developed that has psychoactive or medicinal properties,
whether growing or not, including the seeds thereof. “Cannabis” also means marijuana
as defined by Section 11018 of the Health and Safety Code as enacted by Chapter 1407
of the Statutes of 1972, and amended by the California Control, Regulate and Tax Adult
Use of Marijuana Initiative, and as defined by other applicable state law.
C. "Cannabis industry tax” means the tax due pursuant to this Chapter for engaging in
commercial cannabis activity in the City.
D. "Cannabis product" means any product containing cannabis, including, but not limited to,
flowers, buds, oils, tinctures, concentrates, extractions, edibles and those products
described in Section 11018.1 of the Health and Safety Code.
E. “Commercial Cannabis Activity” as defined by Section 10.96.040 San Rafael Municipal
Code.
F. “Cannabis Business” means any business activity in the City relating to commercial
cannabis activity.
G. “City” means the City of San Rafael either the entity or its territorial limits, as the context
requires.
H. “City Council” or “Council” means the City Council of the City of San Rafael.
I. "Collector” means the City’s Finance Director or his or her designee.
J. “Delivery” means the commercial transfer of cannabis or cannabis products from a non-
storefront dispensary, up to an amount determined by the State Bureau of Cannabis
Control to a primary caregiver or qualified patient as defined in Section 11362.7 of the
Health and Safety Code , or a testing laboratory. “Delivery” also includes the use by a
dispensary of any technology platform owned and controlled by the non-storefront
dispensary, or independently licensed under this chapter that enables qualified patients
or primary caregivers to arrange for or facilitate the commercial transfer by a licensed
dispensary of medical cannabis or medical cannabis products.
K. "Distributor'' means a person engaged in procuring cannabis from a cultivator, and/or
procuring cannabis products from a manufacturer, for sale to a dispensary. In addition,
and without limiting the foregoing, “distributor” includes “distributor” as defined in
California Business and Professions Code section 19300.5 and any successor statute,
as may be adopted or amended from time to time. "Distribution" means engaging in that
conduct and a "distribution facility" is any real estate, whether or not improved, used in
such conduct.
L. "Employee" means each and every person engaged in the operation or conduct of any
cannabis business, whether as owner, member of the owner's family, partner, associate,
agent, manager or solicitor, and each and every other person employed or working in
such cannabis business for a wage, salary, commission, barter or any other form of
compensation.
M. "Gross Receipts," means “Gross Receipts” as that term is defined in Section 10.04.010
“definitions” of the San Rafael City Code.
N. "Manufacturer" means a person who conducts the production, preparation, propagation,
or compounding of cannabis or cannabis products either directly or indirectly or by
extraction methods, or independently by means of chemical synthesis, or by a
combination of extraction and chemical synthesis, or that packages or repackages
cannabis or cannabis products or labels or re-labels its container. In addition, and
without limiting the foregoing, “manufacturer” includes “manufacturer” as defined in
California Business and Professions Code section 19300.5 and any successor statute,
as may be adopted or amended from time to time.
O. "Sale" means “Sale” as that term is defined in Section 10.04.010 of the San Rafael
Municipal Code.
P. "State" means the State of California.
3.40.050. Tax Authorized. A cannabis industry tax is hereby imposed on every person who is
engaged in commercial cannabis activity in the City as prescribed herein, from and after the
effective date of a City Council resolution implementing the tax. It is unlawful for any person to
transact or carry on any cannabis business in the City without paying, in accordance with this
Chapter, the cannabis industry tax imposed by this section.
A. Tax on Cannabis Manufacturers, Distributors, and Delivery Retailers
1. There is hereby imposed on every licensee engaged in a cannabis business in
the City as an infused product manufacturer, distributor, testing laboratory, or
non-storefront delivery an annual tax at a rate established by resolution of the
City Council which rate shall not exceed eight percent (8%) of annual gross
receipts. The tax imposed shall be due and payable in installments as provided in
Section 3.40.070 of this Chapter. The tax imposed shall not be implemented
unless and until the City Council acts by resolution to do so.
B. The City Council may by resolution, in its discretion, implement a tax rate lower than
the maximum rate established:
1. For all persons engaged in the commercial cannabis industry differing tax rates
can be set for different categories of cannabis business. For example, and
without limitation, the City Council may set different rates for businesses serving
medical or adult use, or for different types of manufacturers, distributors, testing
laboratories or non-store front delivery retailers. The City Council may, by
resolution, also decrease or increase any such tax rate from time to time,
provided that the tax rate shall not, at any time, exceed the maximum tax rate
established. Tax rates shall be set for a minimum of a two (2) year term.
2. Persons subject to the tax imposed shall also register and pay the registration
fee described in Section 3.40.060 of this Chapter, but shall be exempt from
paying the general business tax required under Section 10.04.105 and 10.04.106
of the San Rafael Municipal Code for any such cannabis business. A business
not subject to the cannabis industry tax imposed by this Chapter is subject to the
general business tax required under Sections 10.04.105 and 10.04.106 of the
San Rafael Municipal Code except as otherwise provided by Chapter 3.40 of this
Code or other applicable law.
3. No further voter approval shall be required for the adoption or increase of a tax
under the authority granted by Section 3.40.050 of this Chapter, it being the
intent of the People of the City of San Rafael to authorize such a tax up to and
including the maximum rates set forth above whenever implemented by the City
Council hereafter.
3.40.060. Registration of Commercial Cannabis Activity. All licensees shall be required to
annually register as follows:
A. All persons engaging in a cannabis business shall register with the Collector within
thirty (30) days of commencing operation or by July 31, 2018, and shall annually
renew such registration by January 1 of each year thereafter. In registering, such
persons shall furnish to the Collector a sworn statement, upon a form provided by the
Collector, setting forth the following information:
• The name of the business
• The names and addresses of each owner
• The exact nature or kind of business
• The place where such business is to be carried on
• A valid San Rafael Cannabis Operator License
• Estimated Gross Receipts
• Any further information which the Collector may require.
B. Any financial information required under Subsection A will be used only to calculate
and enforce the tax imposed under this Chapter, will be exempt from disclosure
under the Public Records Act pursuant to Government Code section 6254(i), and will
not be used by the City for criminal enforcement except as provided in Sections
3.40.270 and 3.40.280 of this Chapter.
C. An annual registration fee of $250 shall be presented with the sworn statement
submitted under this section. This fee shall not be considered a tax and may be
adjusted by resolution of the City Council.
D. Unless otherwise specifically provided by the Collector in writing, the annual fee
under this section shall be due and payable in advance, on the first day of January,
and shall be considered delinquent if unpaid after the last day of February. The date
on which the fee becomes delinquent may be extended in writing by the Collector,
upon good cause shown, to a date not later than March 31st.
E. For each cannabis business subject to tax under this Chapter, a separate registration
and fee shall be required under this section for each branch or location of the
business and for each separate type of cannabis business at each branch or
location.
F. Upon receipt of the registration and fee required under this Section, the Collector
shall issue to the cannabis business a Certificate of Registration. Such Certificate of
Registration shall be non-transferrable except as otherwise provided by the Collector
in writing.
3.40.070. Reporting and Remittance of Tax. The cannabis industry tax imposed by this
Chapter shall be due and payable as follows:
A. Each person subject to tax under this chapter shall, on or before the last day of the
month following the close of each calendar quarter, prepare and submit a tax return and
remit to the Collector the tax due for that quarter. At the time the return is filed, the full
amount of the tax due for the prior quarter shall be remitted to the Collector. At any time,
a business may apply in writing to the Collector to have these tax returns and payments
made less frequently or on a different schedule. Any determination resulting from this
application will be at the sole discretion of the Collector and shall be provided in writing.
B. All tax returns shall be completed on forms prescribed by the Collector.
C. Tax returns and payments for all outstanding taxes owed the City under this Chapter are
immediately due and payable to the City of San Rafael upon cessation of business for
any reason.
3.40.080. Payments and Communications – Timely Remittance. Whenever any payment,
return, report, request or other communication is due under this Chapter, it must be received by
the Collector on or before the due date. A postmark will not be accepted as timely remittance. If
the due date falls on Saturday, Sunday or a City holiday, the due date shall be the next regular
business day on which the City is open to the public.
3.40.090. Payment – When Taxes Deemed Delinquent. Unless otherwise specifically
provided under other provisions of this Chapter, the taxes required to be paid pursuant to this
Chapter shall be deemed delinquent if not received by the City of San Rafael on or before the
due date as specified in Section 3.40.070.
3.40.100. Notice Not Required By City. The City of San Rafael is not required to send a
delinquency or other notice or bill to any person subject to this Chapter. Failure to send such
notice or bill shall not affect the validity of any tax or penalty or interest due under this Chapter.
3.40.110. Delinquent Taxes – Penalties and Interest. Penalties and interest shall be applied
according to Section 3.20.080 of the San Rafael Municipal Code.
3.40.120. Waiver of Penalties. The Collector may waive the penalties imposed upon any
person if:
A. The person provides evidence satisfactory to the Collector that failure to pay timely was
due to circumstances beyond the control of the person and occurred notwithstanding the
exercise of ordinary care and the absence of willful neglect, and the person paid the
delinquent cannabis industry tax and accrued interest owed the City before applying to
the Collector for a waiver.
B. The waiver provisions specified in this subsection shall be granted to a particular
cannabis business only once during any twenty-four-month period.
3.40.140. Exemptions from the Tax.
A. Nothing in this Chapter shall be deemed or construed to apply to any person transacting
and carrying on any business that is exempt from the payment of such taxes as are
herein prescribed by virtue of the Constitution or applicable statutes of the United S tates
or of the State.
B. Any person claiming an exemption pursuant to this Section shall file a sworn statement
with the Collector stating the facts upon which exemption is claimed. Unless and until the
Collector determines in writing that such person is exempt from tax under this Chapter,
such person shall be liable for the payment of the tax imposed by this Chapter.
C. This Chapter shall not be deemed or construed to require the payment of any general
business tax under Chapter 10.04 of the San Rafael Municipal Code for any commercial
cannabis activity that is subject to payment of a cannabis industry tax under this
Chapter.
3.40.150. Enforcement. It shall be the duty of the Collector to enforce each and all of the
provisions of this Chapter, in accordance with the procedures of Section 10.04.090 of this Code.
3.40.160. Rules and Regulations. The Collector may adopt rules and regulations not
inconsistent with the provisions of this Chapter as may be necessary or desirable to aid in the
implementation and enforcement of the provisions of this Chapter. A copy of any such rules and
regulations shall be available for public inspection in the Collector’s office and on the City’s
website.
3.40.170 Apportionment. If a cannabis business subject to cannabis industry tax is operating
both within and outside the City, it is the intent of the City to apply the cannabis industry tax so
that measure of the tax fairly reflects the proportion of the taxed activity actually carried on in the
City. The Collector may adopt administrative procedures for apportionment pursuant to section
3.40.160.
3.40.180. Construction.
A. This tax is intended to be applied in a manner consistent with the United States and
California Constitutions, state and local law. None of the tax provided for by this Chapter
shall be applied in a manner that causes an undue burden upon interstate commerce, a
violation of the equal protection or due process clauses of the Constitutions of the United
States or the State of California or a violation of any other provision of the California
Constitution, state or local law.
B. This Chapter shall be construed and implemented consistent with the provisions of
Chapter 10.04 of this Code except as this Chapter or other law otherwise requires or the
Collector otherwise determines in writing as authorized under this Chapter.
3.40.190. Audit and Examination of Records and Equipment.
A. The Collector shall have the power to audit and examine all books and records of any
person engaged in cannabis business in the City, including both state and federal
income tax returns, California sales tax returns, or other evidence documenting the
gross receipts of persons engaged in cannabis business, and, where necessary, all
equipment of any person engaged in cannabis business in the City, for the purpose of
ascertaining the amount of cannabis industry tax, if any, required to be paid under this
Chapter, and for the purpose of verifying any statements or any item thereof when filed
by any person pursuant to this Chapter. If such person, after written demand by the
Collector, refuses to make available for audit, examination or verification of such books,
records or equipment as the Collector requests, the Collector may, after full
consideration of all information within his or her knowledge concerning the cannabis
business and activities of the person so refusing, make an assessment against the
cannabis business of the taxes estimated to be due under this Chapter, following the
procedures, rights and obligations set forth in Section 3.20.090 of the San Rafael City
Code.
B. It shall be the duty of every person liable for the collection and payment to the City of
any tax imposed by this Chapter to keep and preserve, for a period of at least three (3)
years from when the tax was due and originally payable, all records as may be
necessary to determine the amount of such tax as he or she may have been liable for
the collection of and payment to the City, which records the Collector shall have the rig ht
to inspect at all reasonable times.
3.40.200. Other Licenses, Permits, Taxes, Fees, or Charges. Except as expressly provided
in this Chapter, nothing contained in this Chapter shall be deemed to repeal, amend, be in lieu
of, replace or in any way affect any requirements for any permit or license required by, under or
by virtue of any provision of any other title or Chapter of this Code or any other ordinance or
resolution of the City, nor be deemed to repeal, amend, be in lieu of, replace or in any way
affect any tax (except business license tax), fee or other charge imposed, assessed or required
by, under or by virtue of any other title or Chapter of this Code or any other ordinance or
resolution of the City. Any references made or contained in any other title or Chapter of this
Code to any permits, licenses, taxes, fees, or charges, or to any schedule of license fees, shall
be deemed to refer to the permits, licenses, taxes, fees or charges, or schedule of license fees,
provided for in other titles or Chapters of the San Rafael Municipal Code unless otherwise
expressly provided.
3.40.210. Payment of Tax Does Not Authorize Unlawful Business.
A. The payment of a tax required by this Chapter, and its acceptance by the City, shall not
entitle any person to engage in any cannabis business unless the person has complied
with all of the requirements of this Code and all other applicable state or local laws.
B. No tax paid under this Chapter shall be construed as authorizing the conduct or
continuance of any illegal or unlawful business, or any business in violation of any state
or local laws.
3.40.220. Deficiency Determinations. If the Collector is not satisfied that any tax return or
other statement filed as required under this Chapter is correct, or that the amount of tax is
correctly computed, he or she may compute and determine the amount to be paid and make a
deficiency determination upon the facts contained in the tax return or statement or any
information in his or her possession or that may come into his or her possession within three (3)
years of the date the tax was originally due and payable, or such later date as allowable by law.
Whenever a deficiency determination is made, a notice shall be given to the person concerned
in the same manner as notices of assessment are given under Section 3.40.250.
3.40.230. Failure to Report – Nonpayment.
Under any of the following circumstances and at any time, the Collector may make and give
notice of an assessment of the amount of tax owed by a person under this Chapter:
1. If the person has not filed a complete return or statement required under this
Chapter.
2. If the person has not timely paid any tax, fee, interest and/or penalties due under of
this Chapter.
3. If the person has not, after demand by the Collector, filed a corrected return or
statement, or furnished to the Collector adequate substantiation of the information
contained in a return or statement filed previously.
The notice of assessment shall separately set forth the amount of any tax, fee, interest and/or
penalties known by the Collector to be due or estimated by the Collector, after consideration of
all information within the Collector's knowledge concerning the business and activities of the
person assessed, to be due under each applicable section of this Chapter.
3.40.240. Tax Assessment – Notice Requirements. The notice of assessment shall be served
upon the person liable for the tax under this Chapter either by personal delivery, or by a deposit
of the notice in the United States mail, postage prepaid thereon, addressed to the person at the
address of the location of the business or to such other address as he or she shall register with
the Collector for the purpose of receiving notices provided under this Chapter; or, should the
person have no address registered with the Collector for such purpose, then to such person's
last known address. For the purposes of this section, a service by mail is complete at the time of
deposit in the United States mail.
3.40.250. Appeal Procedure. Any taxpayer aggrieved by any decision of the Collector with
respect to the amount of tax, fee, interest and penalties, if any, due under this Chapter may
appeal to the City Manager, or their designee by filing a written appeal with the Clerk of the San
Rafael City Council within fifteen (15) calendar days of the mailing of the decision or
determination. The Clerk shall schedule the appeal and give fifteen (15) days written notice to
the appellant of the time and place of hearing by serving the notice personally or by depositing
in the United States Post Office in the City, postage prepaid, addressed as shown on the appeal
papers or, if none, such other address as is known to the City or, absent any address, by
publication in a newspaper of general circulation in the City. The City Manager, or designee
considering the appeal shall have authority to determine all questions raised on such appeal. No
such determination shall conflict with any substantive provision of this Chapter.
3.40.260. Conviction for Chapter Violation – Taxes not Waived. The conviction and
punishment of any person for failure to pay a required tax, fee, penalty and/or interest under this
Chapter shall not excuse or exempt such person from any civil action for the amounts due under
this Chapter. No civil action shall prevent a criminal prosecution for any violation of the
provisions of this Chapter or of any state law requiring the payment of all taxes.
3.40.270. Violation Deemed Misdemeanor. Any person who violates any provision of this
Chapter or who other than by a sworn statement, knowingly or intentionally misrepresents to
any officer or employee of the City any material fact herein required to be provided is guilty of a
misdemeanor punishable as provided in section 1.16.060 San Rafael Municipal Code. A person
who on a sworn statement states as true a material fact that he or she knows to be false is guilty
of perjury.
Any violation of this chapter may be enforced either as an infraction, a misdemeanor, by an
administrative citation or administrative order pursuant to Chapters 1.44 or 1.46 of this Code, or
by any other remedy available to the city under this Code or state law. All such remedies shall
be alternative to or in addition to or in conjunction with, and not exclusive of, one another. The
election of remedies shall be at the sole discretion of the City.
3.40.280. Actions to Collect. The amount of any tax, fee, penalty and/or interest imposed
pursuant to this Chapter shall be deemed a debt owed to the City. An action may be
commenced in the name of the City in any court of competent jurisdiction, for the amount of any
delinquent tax, fees, penalties and interest thereon, collection costs and reasonable attorney’s
fees.
3.40.290. Severability. If any provision of this Chapter, or its application to any person or
circumstance, is determined by a court of competent jurisdiction to be unlawful, unenforceable
or otherwise void, that determination shall have no effect on any other provision of this Chapter
or the application of this Chapter to any other person or circumstance and, to that end, the
provisions hereof are severable.
3.40.300. Remedies Cumulative. All remedies and provisions prescribed under this Chapter
shall be cumulative of, and in addition to, all of the obligations, prohibitions, requirements, and
remedies contained in other chapters of this code and the use of one or more remedies by the
City shall not bar the use of any other remedy for the purpose of enforcing the provisions hereof.
3.40.310. Amendment or Repeal. This Chapter may be repealed or amended by ordinance of
the San Rafael City Council without a vote of the People except that, as required by Article XIIIC
of the California Constitution, any amendment that increases the maximum rates of tax beyond
the levels authorized in Section 3.40.050 above shall not take effect unless approved by a vote
of the People. The City Council may, by resolution, implement a tax under this Chapter in any
amount or at any rate that does not exceed the maximum rates set forth in Section 3.40.050.
DIVISION 2. CEQA. The approval of this Ordinance is exempt from the California
Environmental Quality Act (Public Resources Code §§ 21000 et seq., “CEQA,” and 14 Cal.
Code Reg. §§ 15000 et seq., “CEQA Guidelines”). The cannabis industry tax to be submitted to
the voters is a general tax that can be used for any legitimate governmental purpose; it is not a
commitment to any particular action nor does it authorize any private activity, but merely taxes
such activity as otherwise occurs. As such, under CEQA Guidelines section 15378(b)(4), the tax
is not a project within the meaning of CEQA because it creates a government funding
mechanism that does not involve any commitment to any specific project that may result in a
potentially significant physical impact on the environment. If revenue from the tax are used for a
purpose that would have either such effect, the City will undertake the required CEQA review for
that project. Therefore, pursuant to CEQA Guidelines section 15060 CEQA analysis is not
required at this time.
DIVISION 3. Effective and Operative Dates. This ordinance shall take effect 10 days
after the election result is certified as provided by Elections Code but the taxes imposed by this
ordinance shall take effect only when and to the extent implemented by resolution of the City
Council.
DIVISION 4. Certification; Publication. Upon approval by the voters, the City Clerk
shall certify to the passage and adoption of this Ordinance and shall cause it to be published, in
full or in summary form, according to law.
Commercial Cannabis Business Tax
March 5, 2018
San Rafael Cannabis Business Tax
Proposed Ballot Language
To maintain/enhance City of San Rafael services,
with funding that cannot be taken by Sacramento,
including: enhancing police and fire services;
repairing potholes/maintaining streets; enhancing
community centers; and administering a cannabis
oversight program; shall the City of San Rafael’s
ordinance levying, until repealed, a tax of up to
8% on cannabis (marijuana) businesses’ gross
receipts in the city, providing approximately
$1,000,000 annually, requiring independent
citizen oversight, financial audits, and that all
funds stay in San Rafael be adopted?
CITY OF SAN RAFAEL
NOTICE OF PUBLIC HEARING
DATE/TIME: Monday, March 5, 2018 at 7:00 p.m.
LOCATION: City Council Chambers, 1400 Fifth Avenue, San Rafael, CA
PURPOSE: To receive public comments and consider adoption of a resolution
to call a Special Municipal Election in the City of San Rafael to be
held on June 5, 2018, and ordering the submission of a ballot
measure to levy a special cannabis industry gross receipts tax to
the qualified voters of the City of San Rafael at that election.
IF YOU CANNOT You may send a letter to Lindsay Lara, City Clerk, City of San
ATTEND: Rafael, P.O. Box 151560, San Rafael, CA 94915-1560. You
may also hand deliver a letter prior to the meeting.
FOR MORE
INFORMATION: You may contact Danielle O’Leary, Director of Economic
Development and Innovation at (415) 485-3460 for more
information, Monday through Friday, 8:00 a.m. to 5:00 p.m.
SAN RAFAEL CITY COUNCIL
/s/ _______________________
LINDSAY LARA,
Interim City Clerk, City of San Rafael
STAFF REPORT APPROVAL
ROUTING SLIP
Staff Report Author: Danielle O’Leary Date of Meeting: 03/05/2018
Department: Economic Development
Topic: Cannabis Policy
Subject: Cannabis Industry Tax
Type: (check all that apply) ☐ Consent Calendar ☒ Public Hearing
☐ Discussion Item ☒ Resolution ☒ Ordinance
☐ Professional Services Agreement ☐ Informational Report
*If PSA, City Attorney approval is required prior to start of staff report approval process
Was agenda item publicly noticed? ☒ Yes ☐No Date noticed:
2/23/18
☐Mailed ☐Site posted ☒Marin IJ
Due Date Responsibility Description Completed
Date Initial / Comment
DEPARTMENT REVIEW
FRIDAY noon
Director Director approves staff
report is ready for ACM,
City Attorney & Finance
review.
2/13/2018
☒
DO
CONTENT REVIEW
MONDAY
morning
Assistant City Manager
City Attorney
Finance
ACM, City Attorney &
Finance will review items,
make edits using track
changes and ask questions
using comments. Items will
be returned to the author
by end of day Wednesday.
2/24/2018
2/19/2018
☒
CA
☒
LM
☐
DEPARTMENT REVISIONS
WEDNESDAY
noon
Author Author revises the report
based on comments
receives and produces a
final version (all track
changes and comments
removed) by Friday at
noon.
2/25/2018
☒
DO
Incorporated Lisa’s
changes to the tax in all
documents: staff
report, ordinance,
resolution.
ACM, CITY ATTORNEY, FINANCE FINAL APPROVAL
MONDAY
morning
Assistant City Manager
ACM, City Attorney &
Finance will check to see
their comments were
Click here to
enter a date.
☐
City Attorney
Finance
adequately addressed and
sign-off for the City
Manager to conduct the
final review.
Click here to
enter a date.
Click here to
enter a date.
☐
☐
TUES
noon
City Manager Final review and approval Click here to
enter a date.
☐
Dear San Rafael Council Members,
This press release was carried in 152 markets with 14,000,000 views. All of the founders of our
Consortium live in Marin, I am a 62 year resident. Since all of our research will be done in
Marin, we offer our services Pro Bono. We have found that most councils are not even aware of
the statutory language of the law. It is not only is confusing, but changing almost weekly. San
Rafael is way ahead of the game with Danielle O'Leary advising the City. I just met her at the
Planning meeting and was surprised and impressed with her knowledge of prop 64. I personally
helped with the original writing of prop 64 when it was called (Reform California).
Even with the approximately 70% approval of the full legalization of Cannabis, combined with
the fact that I personally consume some THC products , I am pleased to see Marin approaching
this new era oflegalized Cannabis carefully.
San Rafael has an excellent opportunity to develop a true Medical Cannabis program, one that
should meet the needs of the majority as well as the concerns of the residents that don't want it in
town. If towns/cities decide to outright ban the use and safe access to Cannabis, the black market
will set up shop and thrive. I noticed that San Rafael has about forty Cannabis retailers now. The
State will close down some of these, but the ones that don't care about law and order will still
survive. These would be the ones that sell to kids, and I'm not just talking about pot.
Our group has developed several ways to mitigate these issues in communities.
We are only interested in providing this advice if San Rafael is truly interested in REAL Medical
Cannabis.
We see so many communities think they are doing the right thing by going "medical only" Quite
frankly the only difference between the States version of medical and adult cannabis licenses, is
the sale tax, that's it just sales tax. The latest data we have is that the medical licensed mobile
non store front retailors only sell about 5% medical, and the rest is all get stoned based, dank
weed. While the state is also addressing this, It will be hard to change directions later without the
inevitable legal challenges.
Our Consortium feels the difference is whether the buyer/sellers are consuming Cannabis for
medicine or to just get stoned/high . While this is not clearly black or white, we feel that with
proper planning San Rafael can create a profitable, well managed, honorable program that any
politician can defend as positive.
The rub here is that this effort cannot be achieved with 3 minutes at the podium.
We are at your service.
Thank You.
Medical Cannabis Research Consortium of Marin
Michael Moskowitz, MD, MPH and Randy Perretta of Anandamedicine, Bill Heriot of Liposome
Formulations Inc, George Bianchini of Medi-Cone and Leonard Leinow of Synergy Wellness have joined
to form the Medical Cannabis Research Consortium of Marin (MCRCM). These five long-term Marin
County residents are making Marin County the national research center for vertically integrated medical
cannabis research, maintaining California's innovative leadership in establishing, maintaining and
evolving medical cannabis as an effective, patient-centered treatment. Dr. Moskowitz stated, "We found
each other through the research each of us has been doing with medical cannabis. We are researching it
from seed to symptom."
Dr. Moskowitz, the author of Medical Cannabis: A Guide for Patients, Practitioners and Caregivers is a
Pain Medicine and Psychiatric practitioner. He wrote this book to bring together the most current research
on medical cannabis with this rapidly developing, patient-led treatment. He learned that there was
excellent pharmacological science, but scant clinical research or medical guidance. "Great preliminary
work had been done. Now we have a plant with so many independent and synergistic pharmacological
effects, but only minimal clinical research or mainstream medical involvement." He has lectured across
the country on medical cannabis and has integrated treatment with it deeply into his pain treatment
practice. "The results of using cannabis with my patients and bringing to bear the latest research with
traditional medical treatment has been one of the most rewarding experiences of my professional life."
Dr. Moskowitz has been conducting a prospective clinical case series for the last two and one half years,
following 157 patients for an average of 18.5 months using medical cannabis to treat chronic pain and
mood disorders. 86.9% of these patients have reduced pain and 66.1 % of these patients using long term
opioid treatment were able to lower their opioids, using medical cannabis. Similar improvements were
seen with sleep, anxiety and quality of life.
George Bianchini saved his own life using medical cannabis, felt that this was an underutilized treatment
and decided to do something about it. He started growing and crossing strains with medically active
cannabinoids that are extremely rare, creating several medical strains that have yielded a treasure trove of
unique cannabinoid profiles. "I decided to breed the medical back into cannabis, because it had been
systematically removed to develop stronger highs." While cannabis saved Mr. Bianchini's life, he
returned the favor and saved and developed many medical strains . He established himself as an up and
coming leader in the medical cannabis community in 2008 when he launched Medi-Cone and began
winning awards for his high quality medicine. One of Mr. Bianchini's most unusual strains, Black
Beauty, comes from a sub-Saharan African parent plant and is extremely high in THCV a very medical
cannabinoid, completely absent in more than 99% of strains. "I've crossed it with high THC and high
CBD strains. I've gotten paI1icuiarly interesting cannabinoid profiles crossing it with Industrial Hemp."
Mr. Bianchini has developed a Private outdoor research and conservation growing area, incorporating
aquaculture and aquaponics for extreme water conservation and non-toxic pest control. He uses principles
dating back to Bernoulli, Newton and the Hanging Gardens of Babylon. "There is a great deal of
knowledge, going back centuries, in how to grow green in times where crop failure was synonymous with
starvation. "
Bill Heriot has been a pioneer in chemical, pharmaceuticals and the development of pharmaceutical
companies, here in Marin County. He is the co-founder of Omniglow Corp, a manufacturer of
chemiluminescent lightsticks and glow devices. Omniglow was a contractor for the Department of
Defense for both gulf war's producing chemiluminescent devices for the military. His scientific
background and insatiable curiosity are rooted in his UC Berkeley education in chemistry and
biochemistry. He has founded, owned and run several successful pharmaceutical and biotechnology
companies. Mr. Heriot's current company Liposome Formulations, Inc gives him ownership of9
international patents for delivering various substances 4-5 times faster and more efficiently than in normal
oral absorption. He has used his manufacturing technique to deliver supplements and Vitamin C, as well
as drugs for osteoarthritis that are currently in clinical trials with FDA. The various cannabinoids lend
themselves well to this process and the city of Novato has granted Liposome Formulations Inc a
manufacturing license to research and produce Medical Cannabis as a pharmaceutical. Mr. Heriot notes,
"Creating new delivery systems for the various plant based cannabinoids opens up whole new
possibilities to develop pharmaceutical grade medicine."
Leonard Leinow, the author of CBO : A Patient's Guide to Medical Cannabis, Healing Without the High,
has been promoting, growing and manufacturing CBO rich plants for the last decade. He is dedicated to
medical cannabis as a treatment for patients of Synergy Wellness. "84% of the sales at Synergy Wellness
are CBO dominant." He has gathered feedback on what works medically, from Synergy's members.
Additionally, Mr. Leinow has researched the literature on the medical benefits of cannabis, sharing this
information with his staff, patients and the general pUblic. He has more strains ofCBO dominant plants
than any dispensary in California, despite being smaller in patient base compared to most of them. Mr.
Leinow, who has an engineering background, has been a pioneer in CBO as well as delivery systems for
medical cannabis. He approaches each client from a physical, mental, emotional and spiritual perspective
to create guidance tailored to the individual needs. He works with the life-force energy and the spirit of
the cannabis plant, using meticulous organic and ecologically sound practices.
Randy Perretta is a systems and computer analyst and scientist, who has managed huge projects for
aerospace, oil and gas, large scale manufacturing projects, business process development and data
management. He is an expelt in computer programming and secure database development. "The only way
to get useful information about medical cannabis use is to collect, store, secure and evaluate large sets of
data." Mr. Perretta has developed granular search techniques that allow for big data to be quickly
analyzed to identify trends, as well as clinical similarities and differences. "Applying these techniques to
crowd sourced data can yield more reliable infOimation to determine pharmacologic properties of strains,
individual cannabinoids and cannabinoid synergies." He brings his data, business and software skills to
bear in the consortium where, using the latest data engines, he is developing a state of the art custom
search engine and data repository capable of processing real time patient data and collecting clinical data
worldwide. It will feature an analytics capability for profiles, symptoms and treatments heretofore unseen
in the cannabis world.
The consortium is working with city governments in Marin to position the county to develop and
integrate agricultural and clinical research with its budding pharmaceutical business development. "We
formed this consortium to research all of the cannabinoids that have known pharmacologic properties. To
accomplish this we need the skills and experience of all involved. The ability to design plants, preserve
their genetics, cross breed them with cannabis and hemp, research and develop new pharmacologic
delivery systems, manufacture and deliver products, perform clinical research and collect and use data
requires much more than anyone person can provide," noted Mr. Perretta.
So how did an internationally known pain medicine and psychiatric physician and teacher, a systems
based technology expert with deep skills in software, hardware and large scale database development and
management, a pharmaceutical delivery system, manufacturer, chemist and defense contractor and two
pioneering cannabis breeders, with deep roots in the medical cannabis community get together and why?
The answer is simple. Medical Cannabis, as a treatment made sense to all of them before they met, and
once each connected with the other, the bond was instant and "just feels right," according to Mr. Leinow.
Each had established themselves in their own fields and felt it was time to apply their mUltidisciplinary
skillsets to the issue of researching the medicinal qualities of cannabis, in order to help develop improved
ways of delivering treatment options for patients seeking a more effective and collaborative type of care.
"For me the pieces just all fell together. Leonard and George were in the medical cannabis business for all
the right reasons and had each developed incredible strains. Randy had highly sophisticated skills for
collecting and analyzing the data and Bill had this amazing pharmaceutical operation. The businesses
weren't located all over the world. They were right here in Marin County," observed Dr. Moskowitz. Mr.
Heriot stated, "We have taken unique strains and are sequencing their genomes, while preserving them
with tissue culture. In the meantime we are developing clinical research models that establish new
paradigms. It's a really great story." Mr. Bianchini has been very visible in promoting the cause of
medical cannabis and has taken tremendous risks to his own welfare to be a strong advocate for its use.
"The development of recreational cannabis in the state provides an opportunity for the medical
dispensaries to work more closely with patients who are looking for more. I have been developing unique
medical strains and they need to be studied to see what they can really provide as medicines." Mr. Leinow
has dedicated his work with medical cannabis to finding ways to use it for treatment, while not needing
to be impaired. "THC is a great medicinal cannabinoid, but there is no way to make this a mainstream
treatment, if people have to be high all of the time." His interest in pursuing his research and blending this
with the rest of the consortium's work is to help answer the questions he has heard over the years from the
patients at his dispensary. "What works for a headache?" How can I take this without being altered.?"
"Can it help with my cancer symptoms and side effects?" "Is CBD or THC more medicinal?" "What can
the other cannabinoids do to help?"
The Medical Cannabis Research Consortium of Marin formed to look at all aspects of medical cannabis.
All involved are strongly attached to their lives and businesses in Marin County and feel that with this
group and the county's interest in providing the best healthcare for its citizens, a mutually beneficial plan
makes great sense. Dr. Moskowitz stated, "Look, it's in everyone's interest in the country to have high
quality research on medical cannabis from the way it is grown, combined and refined to the effects it has
on health. This is probably the most medicinal plant on this planet, and it must be studied. Since we have
all of the elements to do so, we're going to do our research and development in Marin County."
Feb 17,2018
NOTICE OF BOOI( SIGNINGI,
Medical Cannabis: A Guide/or Patients, Practitioners and Caregivers
MEET, Author Dr. Moskowitz on Friday, February 23, 6pm 2018 Cibol20l Bridgeway Sausalito,
CBD: A Patient's Guide To Medical Cannabis
MEET Author Leonard Leinow and Juliana Birnbaum
on Sunday, March 4th 1 pm at Book Passage in Corte Madera
Contact info:
Dr. "Michael Moskowitz" <mmoskowitz@neuroplastix.com>
"Bill Heriot" <niaid@well.com>,
George Bianchini <george@medi-cone.com