Every medical marijuana collective, cooperative, dispensary,
operator, establishment, provider or other type of entity legally
cultivating medical marijuana in the City, consistent with the provisions
of the Medical Marijuana Program Act (California Health and Safety
Code Section 11362.5 et seq.), shall pay an annual tax of $5.75 per
square foot for space utilized in connection with the cultivation
of marijuana for medical use.
(Ord. 559 11-4-14; Ord. 733 3-2-21; Ord. 795, 12/5/2023; Ord.
796, 3/5/2024)
The purpose of this tax is to raise revenue to fund general
municipal services.
(Ord. 559 11-4-14)
This tax shall not be specifically charged or assessed to any
qualified patient or primary caregiver. Payment and remittance of
the tax to the City shall solely be the responsibility of the medical
marijuana collective, cooperative, dispensary, operator, establishment,
provider or other type of entity, that is authorized to legally cultivate
medical marijuana, within the City, consistent with the provisions
of the Medical Marijuana Program Act (California Health and Safety
Code Section 11362.5 et seq.).
(Ord. 559 11-4-14)
Unless otherwise specifically provided in this chapter, the
words, terms and phrases used in this chapter shall have the same
meanings set forth in the Medical Marijuana Program Act (California
Health and Safety Code Section 11362.5 et seq.).
(Ord. 559 11-4-14)
“Space utilized in connection with the cultivation of
medical marijuana” means any horizontal canopy space used during
the marijuana germination, seedling, vegetative, pre-flowering, flowering
and harvesting phases related to the growth cycle of the marijuana
plant, to include areas where live plants are present. “Space”
excludes the area used for lighting, warming, cooling, aerating, fertilizing,
watering, irrigating, topping, pinching, cropping, curing or drying
marijuana, or any such space used for storing any products, supplies
or equipment related to any such activities, no matter where such
storage may take place or such storage space may be located, including
temporary storage of marijuana plants.
(Ord. 559 11-4-14; Ord. 789 10-17-23)
A.
A six-month tax waiver shall be automatically applied to tax liability
for cannabis cultivation facilities upon the issuance of a new regulatory
permit if all of the following criteria are met:
1.
The cultivator was not already cultivating plants at a facility associated
with the new regulatory permit at the time of its issuance.
2.
The cultivator's facility is located at the same physical address
as a prior cultivator and does not share existing plants, equipment,
or owners with the prior cultivator.
B.
This section shall not apply to cultivators who changed ownership,
obtained a new regulatory permit, and possess live plants from the
previous owner.
(Ord. 800, 4/16/2024)
The taxes imposed by this chapter shall be adjusted annually
beginning on July 1, 2015, and July 1st of each succeeding year based
on the Consumer Price Index (CPI) for All Urban Consumers in the Los
Angeles-Riverside-Orange County areas as published by the United States
Government Bureau of Labor Statistics; however, no adjustment shall
decrease any tax imposed by this chapter, unless approved by the City
Council.
(Ord. 559 11-4-14)
The taxes imposed by this chapter shall be remitted to the City
monthly, on or before the 1st of each month.
(Ord. 559 11-4-14; Ord. 800, 4/16/2024)
All cannabis facilities shall coordinate and create an account
with the City's cannabis fee collection system to collect all
monthly surcharges.
(Ord. 800, 4/16/2024)
The City Council may repeal this chapter, or amend it in a manner
which does not result in an increase in the amount of the tax or broaden
the scope of the tax imposed herein, without further voter approval.
If the City Council repeals any provision of this chapter, it may
subsequently reenact it without voter approval, as long as the reenacted
provision does not result in an increase in the amount of the tax
or broaden the scope of the tax imposed herein.
(Ord. 559 11-4-14)
The City Manager, or designee, and/or the City Council by ordinance,
may promulgate regulations to implement and administer the provisions
of this chapter.
(Ord. 559 11-4-14)
Any entity that fails to pay the taxes required by this chapter
within 30 days after the due date shall pay in addition to the taxes
a penalty for nonpayment in a sum equal to 25 percent of the total
amount due. Additional penalties will be assessed in the following
manner: 10 percent shall be added on the first day of each calendar
month following the month of the imposition of the 25 percent penalty
if the tax remains unpaid— up to a maximum of 100 percent of
the tax payable on the due date. Receipt of the tax payment in the
office shall govern the determination of whether the tax is delinquent.
Postmarks will not be accepted as adequate proof of a timely payment.
(Ord. 559 11-4-14)
B.
The
amount of any tax, interest and penalty imposed by this chapter shall
be deemed a debt to the City.
C.
The
remedies in this chapter are cumulative, and in addition to any and
all other remedies, civil, equitable, or criminal, afforded to the
City.
D.
Any
person owing any tax and related interest and penalty under the provisions
of this chapter shall be liable in an action brought in the name of
the City in any court of competent jurisdiction for recovery of any
such amount.
E.
Except
as otherwise provided, the amendment or repeal of any portion of this
chapter or other portions of this Code affecting this chapter shall
not be construed to operate as a release or waiver of any liability
or sum of money which may be due or owing to the City from any person
under the provisions of this Code as they existed prior to such amendment
or repeal.
(Ord. 559 11-4-14; Ord. 789 10-17-23)
Whenever it is necessary to examine any books or records, including
tax returns, of any entity subject to the provisions of this chapter,
to ascertain the amount of any tax due pursuant to this chapter, the
City shall have the power and authority to examine such necessary
books and records at any reasonable time, including, but not limited
to, during normal business hours. Records must be maintained for at
least seven years.
(Ord. 559 11-4-14)
No payment of any tax required under the provisions of this
chapter shall be construed as authorizing the conduct or continuance
of any illegal business or of a legal business in an illegal manner.
Nothing in this chapter implies or authorizes that any activity connected
with the cultivation, possession or provision of marijuana is legal
unless otherwise authorized and allowed by the State of California
for medical purposes and permitted by the City.
(Ord. 559 11-4-14)
This tax shall become operative commencing upon the effective
date of an ordinance permitting marijuana collectives, cooperatives,
dispensaries, operators, establishments, providers or other type of
entities to sell, distribute, exchange, deliver, provide or dispense
medical marijuana within the jurisdictional boundaries of the City
of Desert Hot Springs. The City shall provide a six-month cultivation
tax ramp-up period for any new cultivation facility.
(Ord. 559 11-4-14; Ord. 789 10-17-23)
