A special election asking Lompoc voters to approve changes to the formula for taxing some cannabis operations will land on the same recall ballot that will determine Gov. Gavin Newsom’s fate.
In a rare meeting Monday due to a tight time frame, the Lompoc City Council voted unanimously on several measures aiming at consolidating the special election, once planned as vote-by-mail only on Aug. 31.
Instead, the city election will share the ballot with the statewide gubernatorial recall election on Sept. 14.
The council members had to decided by Monday’s deadline whether to consolidate the city election, prompting a short morning session despite the fact government agencies were observing the official July 4 holiday.
City Manager Jim Throop said consolidation would save the city “a tremendous amount of money.”
One estimate placed the costs above $250,000 for a single-issue special election in Lompoc compared to approximately $65,000 if consolidated.
Aligning the dates also means the Santa Barbara County Elections Division would handle the Lompoc special election.
“They’re professionals. They do this all the time. They know how to run an election,” he said.
This takes the burden off the city for managing the election.
“I think it’s actually a win for the whole city in the long run,” Throop said.
This means that in addition to all the recall-related items on the statewide ballot, Lompoc city voters also will have the measure, yet to be assigned a letter, related to the cannabis tax on the same ballot.
Declaring a fiscal emergency, Lompoc’s council has agreed to ask voters to consider tweaking the tax rate for manufacturing and distribution operations.
They now are assessed at either $15,000 for less than $2 million in net income or $30,000 for more than $2 million in net income.
Voters will be asked whether those businesses should pay a tiered tax on gross receipts with businesses paying 0.5% for less than $10 million, 1% for more than $10 million to $25 million, 1.5% for more than $25 million to $40 million, 2% for more than $40 million to $50 million, and 2.5% for $55 million or more.
That revenue would go into the General Fund and could be used for public safety, city infrastructure projects and quality-of-life programs.
Based on current operations, the tiered tax would generate about $1.2 million for city coffers annually, city staff said.
In addition to a new tax rate, the proposed measure would clean up other matters, including avoiding what city leaders called “a tax on a tax.”
Consumers would pay the city’s 6% cannabis tax on the cost of the product. Currently, those rates are calculated on the product cost plus state and other taxes so consumers would save money.
Another change would allow the city’s cannabis tax rates to be shown as payments on customers’ receipts.
The measure to implement a new tax rate for cannabis manufacturing and distribution will need more than 50% voter approval to pass.
The council agreed that the new tax rates would take effect in April 2022.