Lompoc ballot.
After making their choices in the gubernatorial special election, Lompoc voters are reminded to turn their ballots over for a local tax measure, Measure Q, related to the rate paid by manufacturing and distribution businesses in the cannabis industry. (Santa Barbara County photo)

Voters in the city of Lompoc have one extra task in the Sept. 14 special election — weighing in on Measure Q, a tax measure related to the local cannabis industry.

In addition to choosing whether to recall Gov. Gavin Newsom and picking a possible replacement, Lompoc voters will be asked about revising the tax rate paid by cannabis manufacturing and distribution businesses. 

Gubernatorial matters fill one side of the ballot for both in-person and mail-in voters, but Lompoc leaders have stressed that their voters have another item to decide. 

“My biggest message is turn the ballot over because we’re on the back side,” Mayor Jenelle Osborne said.

The ballot includes the message, “Turn Card Over for City of Lompoc Measure.”

The local measure appears only on ballots for voters who live in the city of Lompoc and not those who reside in the unincorporated areas such as Vandenberg Village or Mission Hills. 

Measure Q is aimed at changing the tax structure from a flat rate to a tiered approach for manufacturing and distribution businesses in the cannabis industry. 

“They did get a benefit with the flat rate, but in re-examining the impact that manufacturing and distribution had on our local streets and our local public safety, it’s really important that we rectify the difference and have a more equitable tax rate for all of the business in town,” Osborne said.

Those businesses currently pay a flat tax: $15,000 for net income of less than $2 million or $30,000 for net income of more than $2 million.

Measure Q would implement a tiered rate of 0.5 cents per dollar for a manufacturing and distribution business making $10 million or less annually, one cent per dollar for $10 million up to $25 million; 1.5 cents for $25 million up to $40 million; two cents per dollar for $40 million up to $55 million, and 2.5 cents per dollar for $55 million or higher. 

In comparison, manufacturing businesses in other communities pay more, including 15% in Paso Robles, 4% in San Luis Obispo County and 3% in Santa Barbara. 

The measure also would tweak some other aspects of the city’s rules, including allowing Lompoc’s cannabis taxes to be shown on a customer’s receipt, modifying the definition of “manufacturing and distribution,” and adding a definition for “cultivation.”

Dispensaries would not be affected directly by the changed tax rate. 

Lompoc initially implemented a lower rate to incentivize businesses to come to the city, which has had no limits on the number of operating cannabis companies.  

“We’re not looking to drive business away, but when we did our research and compared it to other municipalities both close and far from us, we realized that the flat rate was not equitable and that this is the time to make the change,” Osborne said.

Based on businesses currently operating in the city, staff projected the changed tax rate could generate an additional $1.2 million for the city’s general fund, which pays for public safety, streets, library services and parks. 

Measure Q requires approval of 50% plus one vote to pass. 

The mayor and Councilman Victor Vega signed the argument in the sample ballot in favor of Measure Q, but no one submitted anything opposing the measure. 

Lompoc scrambled to get the special tax measure on the recall election ballot to cuts costs and have the county handle the Measure Q matter. 

To look up your polling place or voter information guide, go to the Santa Barbara County Elections Division page by clicking here.

Noozhawk North County editor Janene Scully can be reached at jscully@noozhawk.com. Follow Noozhawk on Twitter: @noozhawk, @NoozhawkNews and @NoozhawkBiz. Connect with Noozhawk on Facebook.

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Janene Scully | Noozhawk North County Editor

Noozhawk North County editor Janene Scully can be reached at jscully@noozhawk.com.