Pot advocates challenge Mendocino County cannabis tax

Marijuana advocates have filed suit in Mendocino County Superior Court to overturn the county’s voter-approved pot tax.

They allege in the suit filed Monday that Measure AI was a special tax requiring two-thirds of the vote, not, as county officials claimed, a general tax requiring a simple majority.

In November, 64 percent of voters approved the measure, which placed a 2.5 percent to 10 percent tax on the gross receipts of marijuana growers and a flat rate of $2,500 a year for other cannabis businesses.

An accompanying nonbinding advisory measure indicated voters wanted the money spent on county services, including marijuana code enforcement, police and fire, emergency medical services, road repairs and mental health.

While the spending description includes most county services, the plaintiffs’ attorney, Lawrence Rosen, a wine grape and marijuana grower, contends it’s too specific as a general tax and should have required passage by two-thirds of the vote.

It’s the same argument used by the Howard Jarvis Taxpayers Association in a Jan. 6 lawsuit challenging a city of Ukiah sales tax approved in November.

In that case, the accompanying advisory measure was more narrowly focused, asking city officials to spend the money primarily on roads.

The tax association said such double measures are a common way counties and cities circumvent voting requirements for special taxes.

Outside of the legal arguments, Rosen said he and the plaintiffs also believe the pot tax is unfair, in part because it would force one segment of the industry to pay for those who flout the law.

Supervisor John McCowen noted similar challenges to dual measures in past have failed.

The plaintiffs didn’t pay taxes for decades, he said, and “they like it that way.”