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Smart Voter
Los Angeles County, CA March 8, 2011 Election
Proposition LA-M
Tax on Medical Marijuana
City of Los Angeles

Ordinance - Majority Approval Required
Official Results

Pass: 128,501 / 58.8% Yes votes ...... 90,182 / 41.2% No votes

See Also: Index of all Measures

Information shown below: Summary | Fiscal Impact | Official Information | Impartial Analysis | Arguments |

In order to fund general municipal services, including but not limited to such matters as police protection and crime suppression services, fire prevention and suppression services, park and recreation facilities, and general improvements throughout the City, shall a tax be authorized on marijuana collectives of $50 per $1000 of gross receipts recognizing that the sale of marijuana is illegal?

Summary Prepared by
Ballot Simplification Committee:
THE SITUATION:

A limited number of medical marijuana collectives are allowed to operate in the City. Some collectives currently pay no City business taxes. Others pay City business taxes ranging from $1.27 to $5.07 per $1,000 in gross receipts.

THE PROPOSAL:

This measure would establish a City business tax rate for medical marijuana collectives of $50 per $1,000 of gross receipts. These tax revenues would be used to fund general City services.

A YES VOTE MEANS:

You want to establish a City business tax rate for medical marijuana collectives of $50 per $1,000 of gross receipts.

A NO VOTE MEANS:

You do not want to establish a City business tax rate for medical marijuana collectives of $50 per $1,000 of gross receipts.

Fiscal Impact from Miguel A. Santana
City Administrative Officer:
Any taxes collected under this measure would be used to fund police, fire, street services, parks, libraries and other general purposes throughout the City. Actual revenue would be determined by the gross receipts of all medical marijuana collectives operating in the City of Los Angeles. The number of collectives that may be operating after the effective date of this measure and their gross receipts is unknown.

Official Sources of Information

Impartial Analysis
Several years ago the voters of the State of California authorized the use of marijuana for medicinal purposes. In response, the City of Los Angeles adopted an ordinance regulating the establishment of medical marijuana collectives, including limits on the total number, location and hours of operation. This measure would establish a uniform tax rate for the collectives as discussed below.

This measure would not otherwise regulate collectives. Medical marijuana collectives are composed of four or more members who associate at a particular location to collectively or cooperatively cultivate marijuana for medical purposes, in strict accordance with California Health and Safety Code. To become a member, a person must be a qualified patient, a person with an identification card, or a designated primary care-giver of qualified patients and persons with identification cards.

The City of Los Angeles imposes business taxes on the gross receipts of organizations, businesses, corporations, and other entities conducting business in the City. A medical marijuana collective is an incorporated or unincorporated association.

Since collectives must be operated on a not-for-profit basis, "gross receipts" would be defined to include qualified reimbursable expenses directly related to the cultivation and distribution of medicinal marijuana by and to members ofthe collective.

The City has not yet established a uniform tax rate for medical marijuana collectives. Prior to adoption of the ordinance, collectives either did not report their activities at all or, for purposes of the City's business tax, reported their operations as businesses under a variety of categories, including retail businesses and professional services entities. Each of these business types has a different tax rate, ranging from $l.27 to $5.07 per $1,000 in gross receipts. This measure would establish a single rate for collectives at $50 per $1,000 in "gross receipts" or reimbursable expenses.

Business tax revenues received through the taxation of medical marijuana collective activities will be a General Fund revenue and will fund general City services, such as police and fire services and parks and recreation programs.

This measure will become effective if approved by a majority of voters.

  L.A. City Council Files

Report from City Attorney - November 12, 2010
Nonpartisan Information

Ballotpedia
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Arguments For Proposition LA-M Arguments Against Proposition LA-M
VOTE YES ON MEASURE M TO PROTECT VITAL SERVICES IN LOS ANGELES.

During increasingly hard economic times, when City services are being cut, it is time for Los Angeles to join other major cities, and tax medical marijuana dispensaries.

Currently, these facilities do not pay local business taxes, and that costs our City up to $10 million in desperately needed annual revenues.

Measure M will protect and preserve Los Angeles' most vital services.

Measure M will bring in up to $10 million in new revenues per year to Los Angeles.

Measure M funding will be spent locally and cannot be raided by Sacramento politicians. Every penny will be invested in our community. Regular auditing and oversight will ensure that funds are spent on critically needed services in Los Angeles.

Measure M will protect and restore vital services, such as our police, fire, and 911 emergency services.

Measure M will help to restore library hours and preserve after-school and senior programs throughout the City. 

Measure M will allow the City to continue to pave our roads, alleys and sidewalks.

TO PROTECT VITAL SERVICES IN LOS ANGELES, JOIN POLICE, FIREFIGHTERS, AND COMMUNITY LEADERS, AND VOTE YES ON MEASURE M.

PERSONS SIGNING ARGUMENT IN FAVOR OF CHARTER AMENDMENT M

PAT MCOSKER
President
United Firefighters of Los Angeles City

JANICE HAHN
Councilwoman
City of Los Angeles, 15th District

DR. ELLEN M. GOUDLOCK, MD
President
L.A. City Professional Medical Employees, Local 2006

ANTONIO GONZALES
President
Latino Voter Guide

MARSHALL E. MCCLAIN
President
Los Angeles Airport Police Officers Association

PAUL KORETZ
City Councilmember
City of Los Angeles, 5th District

ROSIE MARTINEZ
Public Health Nurse

DAVE DODDRIDGE
Los Angeles Police Department
Narcotics Detective Retired

Rebuttal to Arguments For
The opposition claims this measure will bring in revenue to the City's budget but fails to take into account:

A No Vote on Measure M will save the City tax payer dollars in defending lawsuits:
This measure will expose the City to lawsuits costing the tax payer if such a business tax is imposed upon legally operating non profit medical marijuana collectives that are exempt under the Los Angeles Municipal Code from paying such taxes.

A No Vote on Measure M will save the City tax payer dollars in creating the infrastructure:
This measure will cost tax payer dollars to create the infrastructure needed to regulate, manage and enforce such a City Tax. The City of Los Angeles, already severely understaffed, has had issues tracking the hundreds of medical marijuana dispensaries that have recently opened. Creating another government layer would only stretch the thin City resources further.

PERSONS SIGNING REBUTTAL TO THE ARGUMENT IN FAVOR OF CHARTER AMENDMENT M

BERNARD C. PARKS
Councilmember
City of Los Angeles

JAN PERRY
Council President Pro Tempore
City of Los Angeles

A No Vote on Measure M keeps City tax laws consistent with Federal Law:
It is illegal under Federal Law, which supersedes State and Local laws, to grow, possess or consume marijuana for any purpose. The City should not place a tax on something our Federal government considers a Schedule I narcotic and against the law.

A No Vote on Measure M keeps the City tax laws consistent with Non-Profit Law:
It is illegal under the City's tax law to impose a business tax or fee based tax on gross receipts of nonprofit organizations such as medical marijuana collectives. California law and the City of Los Angeles' ordinance require medical marijuana collectives to operate as not for profit organizations. 

A No Vote on Measure M will save the City tax payer dollars in defending lawsuits:
This Measure will expose the City to lawsuits costing the tax payer if such a business tax is imposed upon legally operating non profit medical marijuana collectives that are exempt under the Los Angeles Municipal Code from paying such taxes.

A No Vote on Measure M will save the City tax payer dollars in creating the infrastructure:
This Proposition will cost tax payer dollars to create the infrastructure needed to regulate, manage and enforce such a City Tax. The City of Los Angeles, already severely understaffed, has had issues tracking the hundreds of medical marijuana dispensaries that have recently opened. Creating another government layer would only stretch the thin City resources further.

PERSONS SIGNING ARGUMENT AGAINST CHARTER AMENDMENT M

BERNARD C. PARKS
Councilmember
Los Angeles City Council

JAN PERRY
Council President Pro Tempore
Los Angeles City Council

CHARLIE BECK
Chief of Police
LAPD

STEVE COOLEY
District Attorney
LA County

LEE BACA
Sherriff
Los Angeles County

Rebuttal to Arguments Against
MEASURE M IS ABOUT ONE, SIMPLE QUESTION: Do we want medical marijuana dispensaries paying their fair share in City taxes, to support police, fire, and other vital services?

THE CLEAR ANSWER IS YES.

Medical dispensaries are legally operating in Los Angeles, and the City is regulating them. They are here to stay, because in 1996, California voters passed Prop 215, making medical marijuana legal. As the opponents of Measure M admit, these are "legally operating non-profit medical marijuana collectives."

But they don't currently pay business taxes--which could generate more than $10 million annually. It's not fair to other businesses that do pay taxes. Even dispensaries and patients support Measure M; and Los Angeles needs the money right now for more police, firefighters, after school programs and libraries.

THE CHOICE before us is whether these dispensaries pay their fair share in City taxes.

THE CLEAR ANSWER IS YES. YES ON MEASURE M.

PERSONS SIGNING REBUTTAL TO THE ARGUMENT AGAINST CHARTER AMENDMENT M

STEPHEN DOWNING
Deputy Chief (retired)
Los Angeles Police Department

LARRY A. BEDARD, M.D.
Past President
American College of Emergency Physicians

JANICE HAHN
Councilwoman
City of Los Angeles L

JULIE BUTCHER
Coalition of City Unions

PAT MCOSKER
President
United Firefighters of Los Angeles City

BILL ROSENDAHL
Councilmember, 11th District
City of Los Angeles

JEFF STUDDARD
Former Officer
os Angeles School Police


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Created: September 13, 2011 11:10 PDT
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