The Sonoma County Growers Alliance has closely studied Measure A, the Sonoma County cannabis business tax, weighing benefits and concerns. It is with great disappointment that the Sonoma County Growers Alliance board of directors found itself in opposition to Measure A.
We want to explain how our board came to this decision and offer our support to work to craft future policy that has the best interest of the community and local economy in mind.
The alliance’s initial inclination was to maintain a neutral position on Measure A, due to the untenable maneuver that the County placed on Measure A’s passage and the issuance of permits. Without Measure A funding, the county has stated there will be no permitting until a new funding source is found. This puts compliant businesses at risk of not obtaining their state licenses. Our board universally felt that Measure A was taxation overreach yet was hesitant to oppose the measure because there fails to be a clear pathway for cannabis businesses to obtain permits if Measure A fails.
However, in the course of our public and membership outreach, we discovered an overwhelming groundswell from a diverse cross-section of the local cannabis community that clearly opposes this tax measure. A primary concern is that there are no measures in place to prevent the current or future Board of Supervisors from unintentionally crippling the industry and creating an entry barrier into a newly regulated market. The ability to add up to 10 percent on any one license type would artificially shut down that supply chain from doing business within our county.
Too much disruption during the development phase of the regulated marketplace will discourage participation in the program. Measure A was hastily put together by the county as a general tax to raise revenue for permits and for any other use the county sees fit. Measure A is a business tax and has a large tax limit increment, a percentage of gross sales that fluctuates with a majority of votes on the current or unknown future Board of Supervisors. Ultimately, we decided that Measure A is not a viable way forward.
One of local government’s most daunting challenges in recent memory is to engage and support an entire new regulated industry that will create jobs, add to the economic and social fabric of our community and create new revenue sources from businesses that want to be taxed. That is exactly the scenario we have with the local cannabis industry in Sonoma County.
The county missed a huge opportunity to capture the support and partnership of the local cannabis community by rushing Measure A to voters. At the rate of 5 percent of gross sales, it’s difficult for cultivators and business investors to wrap their heads around a profitability scenario in the regulated market that is attractive. Cannabis operators are thus going to explore starting operations elsewhere in other jurisdictions, and Sonoma County will be losing jobs, economic stimulus and tax revenue.
In the past year, Sonoma County Growers Alliance members and volunteers have participated in a range of public discussions and policy debates in Sonoma County’s jurisdictions to craft reasonable and community sensitive cannabis policy. The alliance’s goal is to continue to make progress and work collaboratively with the county and cities to implement taxation programs that allow businesses to thrive while providing significant additional revenue to improve our civic and municipal institutions and programs.