The city council voted 5–2 on July 5 to revive a ballot measure to tax cannabis businesses, which received 64 percent voter approval in June, but still failed to reach the two-thirds majority it needed.
Though retail cannabis is currently illegal in Huntington Beach, the council put the cannabis tax on the ballot so regulations could be in place in case it becomes legal.
But the council went a step further Tuesday and added another measure to legalize retail cannabis.
With the proposed measures, cannabis retailers would be taxed up to 6 percent and non-retailers taxed up to 1 percent of gross receipts on recreational marijuana. Tax is excluded on medical purchases for those aged 18 and older.
Despite Councilman Erik Peterson cautioning his colleagues on the dais to take time in drafting these ordinances, Councilman Dan Kalmick said he was eager to push the vote forward with confidence it will pass in November.
“I think likely they will vote yes,” Kalmick said during the council meeting.
Peterson and Mayor Pro Tem Mike Posey voted against the measures. Posey said he was against introducing more taxes.
A subcommittee to draft the rules for the ballot measures—consisting of councilors Peterson, Kalmick, and Rhonda Bolton—will meet to discuss possible revisions and get the public’s input before finalizing the ordinances by Aug. 12.
The current draft allows up to 10 storefront dispensaries or deliveries.
Non-retailer businesses—such as cannabis distributors—would be allowed testing labs, manufacturing, distribution plants, and indoor cultivation to operate only in areas designated by the city.
A minimum of 1,000 feet must be between retail businesses and all schools, parks, and youth centers. For non-retail businesses, a buffer of 1,000 feet is required from high schools and middle schools, and 600 feet from K–5 schools, parks, and youth centers.
Sales on temporary structures such as vehicles, kiosks, or vending machines for retailers would not be allowed.
The city would require dispensaries and non-retailers to have 24/7 security guards on-site, video cameras inside and outside the building, background checks of owners and employees, customer age verification, and city access to surveillance at any time.
The discussion of cannabis businesses in Huntington Beach started at the end of 2021 when two private parties from the cannabis industry filed separate petitions asking the city to present taxation and land use regulations for voter consideration, according to the city.