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HomeMy WebLinkAboutItem 27 Recreational Marijuana Local Option Tax AGENDA ITEM SUMMARY Meeting Date: 7/18/2016 Meeting Type: Regular Meeting Staff Contact/Dept.: Bob Duey/Finance Kristina Kraaz, CAO Staff Phone No: 541.726.3740 Estimated Time: 10 Minutes S P R I N G F I E L D C I T Y C O U N C I L Council Goals: Financially Responsible and Stable Government Services ITEM TITLE: RECREATIONAL MARIJUANA LOCAL OPTION TAX ACTION REQUESTED: Adopt/not adopt the following ordinance: AN ORDINANCE ADDING SECTION 7.1002(3) TO CHAPTER 7 OF THE SPRINGFIELD MUNICIPAL CODE AND IMPOSING A 3% TAX ON MARIJUANA RETAILERS’ RECREATIONAL SALES IN SPRINGFIELD AND DECLARING AN EMERGENCY and, Adopt/not adopt the following resolution: A RESOLUTION REFERRING TO THE ELECTORS OF THE CITY OF SPRINGFIELD THE MEASURE OF ORDINANCE NO. ____ IMPOSING A 3% TAX ON MARIJUANA RETAILERS’ RECREATIONAL SALES IN SPRINGFIELD. (only approve 1 of 3 versions) ISSUE STATEMENT: ORS 475B.345 allows the City to adopt a 3% tax on marijuana items sold by retailers who are licensed by OLCC (under ORS475B.110). The City Council has previously directed staff to prepare the required Council actions for this to occur. The tax must be adopted by ordinance that is referred by the City Council to the electors of the City at the next general statewide election, which occurs on November 8, 2016. The ordinance as presented will enable the tax to be levied pending the successful vote on November 08th. The Resolution to be passed by Council refers the measure to the voters and includes the actual wording for the ballot title that will be subsequently published for citizen review prior to filing with the County Elections Officer. Council is being asked to select only one of three versions for the ballot title resolution that differ only by the optional placement of restrictions on the future use of any proceeds received from the tax. These options will be further discussed in the Council Briefing Memorandum. ATTACHMENTS: Attachment 1: Council Briefing Memorandum Attachment 2: Ordinance Imposing a 3% Tax on Recreational Marijuana Attachment 3 Version 1: Resolution Referring Local Option Tax to Electors Attachment 3 Version 2: Resolution Referring Local Option Tax to Electors Attachment 3 Version 3: Resolution Referring Local Option Tax to Electors DISCUSSION/ FINANCIAL IMPACT: See Council Briefing Memorandum Attachment 1 – Page 1 of 3 M E M O R A N D U M City of Springfield Date: 7/11/2016 To: Gino Grimaldi, City Manager COUNCIL From: Bob Duey, Finance Director BRIEFING Subject: Recreational Marijuana Local Option Tax MEMORANDUM ORS 475B.345 allows the City to adopt a 3% tax on marijuana items sold by retailers who are licensed by OLCC (under ORS475B.110). The City Council has previously directed staff to prepare the required Council actions for this to occur. The tax must be adopted by ordinance that is referred by the City Council to the electors of the City at the next general statewide election, which occurs on November 8, 2016. The ordinance as presented will enable the tax to be levied pending the successful vote on November 08th. The Resolution to be passed by Council refers the measure to the voters and includes the actual wording for the ballot title that will be subsequently published for citizen review prior to filing with the County Elections Officer. Council is being asked to select only one of three versions for the ballot title resolution that differ only by the optional placement of restrictions on the future use of any proceeds received from the tax. These options will be further discussed in the Council Briefing Memorandum. COUNCIL GOALS/MANDATE: Financially Responsible and Stable Government Services ______________________________________ LOCAL OPTION TAX A legislative enacted ORS allows cities to adopt up to a 3% tax on marijuana items sold by retailers who are licensed by OLCC. The tax may not be assessed against medical marijuana registry identification cardholders or a designated primary caregiver purchasing a marijuana item for the cardholder. The tax must be adopted by ordinance that is referred by the City Council to the electors of the City at the next general statewide election, which occurs on November 8, 2016. The remaining outstanding issue for the final wording of a ballot title on this topic would be the explanation as to the programmatic uses for any revenue that would be generated by the local tax. State law requires that any revenue sharing provided to cities from the state tax on recreational marijuana be restricted to public safety but there are no restrictions for programmatic use placed upon revenue that may be generated by a local tax. At the Council work session on June 13th, Council directed staff to have prepared a final ordinance for adoption and to provide preliminary ballot title options for Council consideration that would provide different degrees of commitment as to how any dollars may be spent. These options were provided in the June 27th Communication Packet and will be repeated in this briefing for consideration. The Resolution itself and the 10-word Caption and the 20-word Question in the ballot title attachments are the same in all 3 versions. The maximum 175-word Statement also appears as part of the official ballot title and any differences between the 3 are highlighted in yellow. The accompanying Explanation Attachment 1 – Page 2 of 3 is not part of the official ballot title but likely would be included in the City’s factual information such as our on-line voter’s pamphlet or mailer. Differences are also highlighted in yellow. A brief explanation follows: Version 1: Most Restrictive Included in the Ballot Title 20-word Statement would be the phrase “The City of Springfield intends to use the revenue from this tax for public safety purposes”. Also, in the Explanation an added phrase is “Under state law, there are not restrictions on how the city may use the revenue generated by this tax. The City intends to use the revenue for public safety purposes.” It is believed that placing the first statement in the actual ballot title Statement does provide for a restriction that all future revenue will be used for this purpose. Version 2: Indicates Policy Intent No statement of intended use is placed in the ballot title Statement. In the Explanation the phrase is “Under state law, there are not restrictions on how the city may use the revenue generated by this tax. The City intends to use the revenue for public safety purposes” is still included. It is believed that the use of this phrase in the Explanation only indicates a policy intent only and although that would be the intent at this time, Council would always have the ability to change that intent at a future time if circumstances or other budgetary requirements became more of a critical issue. Version 3: No Additional Restrictions Again there would be no mention of intended use in the Statement and also in the Explanation there would be no mention of an intended use. The phrase “Under state law, there are not restrictions on how the city may use the revenue generated by this tax” would be the only mention of programmatic intent. REVENUE METHODOLOGY Distribution of State Shared Revenues Pre July 2017 distributions will be per capita in a fashion that is similar to the distribution of revenues from the sale of liquor and cigarettes. Cities are slated to received 10% of the distributed revenue during the 2015/16 and the 2016/17 fiscal years. Estimates are changing although the latest State numbers are indicating that the cities share will be $1.44M in the first year and $2.88 M in the second year. Post July1, 2017 the distribution will be based on the number of licenses issued by the OLCC for premises located in each city, after State administrative and enforcement expenses are deducted. The share will be based on the number of licenses located in the city compared to the total issued by the OLCC for all premises in the state. Local Option Tax Revenues The revenue from any local option tax will be collected similar in nature to the State post July 2017 methodology in that it will based upon sales by retailers located in Springfield. Springfield currently has 8 dispensaries that are registered with the State that were initially for medical marijuana but under the State temporary rules are now able to retail both medical and recreational marijuana. It is most likely that Springfield will choose to contract with the State for the collection of any local option tax that may be levied on retailers of recreational marijuana. There is currently no reliable estimate of the state shared revenue that will be provided to Springfield in either the Pre-July 2017or in the Post July 2017. Local retailers have begun filing sales information with Attachment 1 – Page 3 of 3 the State but there is not enough historical information available yet to make accurate projections for future local option revenues. RECOMMENDATION Staff has no recommendation for Council for selecting one of the three versions of the ballot title resolutions to present to the electors in November. To allow adequate time in the process for the City Recorder to post notice of the upcoming elections for citizen review and to meet filing deadlines with the Lane County Elections Officer staff is requesting that Council pass by motion both the ordinance as presented and one of the three versions of the ballot title resolution. Attachment 2, Page 1 of 2 ORDINANCE NO. _______________ (EMERGENCY) AN ORDINANCE ADDING SECTION 7.1002(3) TO CHAPTER 7 OF THE SPRINGFIELD MUNICIPAL CODE AND IMPOSING A 3% TAX ON MARIJUANA RETAILERS’ RECREATIONAL SALES IN SPRINGFIELD AND DECLARING AN EMERGENCY The Common Council of the City of Springfield finds that: WHEREAS, in 2014, Oregon voters passed Ballot Measure 91, which allowed adults 21 and older to use, grow, process, and sell limited amounts of marijuana for recreational purposes; WHEREAS, in 2014, the City Council adopted a gross receipts tax on the sale of marijuana in the City of Springfield, the amount of tax to be set by Council Resolution; WHEREAS, in 2015, the Oregon Legislature passed House Bill 3400, under which the City of Springfield may impose a tax of up to 3% on the recreational sale of marijuana and marijuana items by marijuana retailers within the City of Springfield; WHEREAS, House Bill 3400 requires a municipal tax on the sale of recreational marijuana to be adopted by ordinance and referred to the electors of the City at a general statewide election; and WHEREAS, the City Council desires to impose a 3% tax on the recreational sale of marijuana and marijuana items by a marijuana retailer within the jurisdiction of the City of Springfield; NOW THEREFORE THE CITY OF SPRINGFIELD ORDAINS AS FOLLOWS: Section 1. Chapter 7 BUSINESS of the Springfield Municipal Code, Section 7.1002, is hereby amended add the following subsection (3): “(3) The amount of tax levied for recreational marijuana shall be 3% of the gross taxable sales of marijuana and marijuana items by a marijuana retailer.” Section 2. Except as specifically amended herein, Chapter 7 shall continue in full force and effect. Section 3. Severability Clause. If any section, subsection, sentence, clause, phrase or portion of this Ordinance is, for any reason, held invalid or unconstitutional by a court of competent jurisdiction, such portion shall be deemed a separate, distinct and individual provision and such holding shall not affect the validity of the remaining portion hereof. Attachment 2, Page 2 of 2 Section 4. Effective Date. This Ordinance shall become effective upon the City of Springfield receiving certified election results from Lane County that show the voters of the City of Springfield have approved a referendum for a 3% tax on the sale of recreational marijuana in the City of Springfield. ADOPTED by the Common Council of the City of Springfield this ______ day of July, 2016, by a vote of ______ for and ______ against. APPROVED by the Mayor of the City of Springfield this ______ day of July, 2016. _______________________________ Mayor ATTEST: _______________________________ City Recorder N:\OneDrive for Business\City\Finance Bancroft\Marijuana Tax\Ordinance re MJ Tax.docx Attachment 3 Version 1, Page 1 of 3 RESOLUTION NO. _______ A RESOLUTION REFERRING TO THE ELECTORS OF THE CITY OF SPRINGFIELD THE MEASURE OF ORDINANCE NO. _______ IMPOSING A 3% TAX ON MARIJUANA RETAILERS’ RECREATIONAL SALES IN SPRINGFIELD As the preamble to this Resolution, the Common Council of the City of Springfield, Oregon (the “City”) hereby recites the matters set forth below. To the extent any of the following recitals relates to a finding or determination which must be made by the Common Council in connection with the subject matter of this Resolution or any aspect thereof, the Common Council declares that by setting forth such recital such finding or determination is thereby made by the Common Council. The recitals, findings and determinations set forth herein constitute a part of this Resolution. (1) POLITICAL SUBDIVISION. The City is a municipality and political subdivision organized and existing under and pursuant to the laws of the State of Oregon and the 2001 Springfield Charter City (the “Charter”). (2) ORDINANCE IMPOSING 3% TAX ADOPTED BY COUNCIL. The Common Council of the City of Springfield has adopted Ordinance No. ____, imposing a 3% tax on the recreational sale of marijuana and marijuana items by a marijuana retailer. (3) REFERRAL TO VOTERS. ORS 475B.110 requires that an ordinance imposing a 3% tax on the sale of recreational marijuana be referred to the voters of the City at a statewide general election, the next of which will be held November 8 2016. NOW THEREFORE BE IT RESOLVED as follows: SECTION 1. APPROVAL OF BALLOT MEASURE IMPOSING A 3% TAX ON MARIJUANA RETAILERS’ RECREATIONAL SALES. The Common Council of the City hereby directs that at the General Election held November 8, 2016, there shall be submitted to the qualified electors of the City of Springfield the measure of Ordinance No. ______, imposing a 3% tax on the recreational sale of marijuana and marijuana items by a marijuana retailer. The Ballot Title is attached hereto as Attachment 1 (“the Ballot Title”), incorporated herein by reference. SECTION 2. SUBMISSTION TO ELECTIONS OFFICER. Not later than the 61st day before November 8, 2016, the City Recorder, as the Chief Elections Officer of the City, shall submit to the County Clerk for Lane County, Oregon, a statement of the ballot measure together with a certified copy of this Resolution and the Ballot Title, all in order that the measure may appear on the ballot for the General Election held on November 8, 2016. The City Recorder shall submit to the County Clerk all necessary Attachment 3 Version 1, Page 2 of 3 information, and shall do and perform all other acts and things necessary or appropriate, so that the measure shall appear on the ballot for such General Election. SECTION 3. ADDITIONAL AUTHORIZATIONS. The City Manager, the City Recorder, the City Finance Director, and the City Attorney, and each of them acting individually, are hereby authorized, empowered and directed, for and on behalf of the City, to do and perform all acts and things necessary or appropriate to cause the ballot measure set forth in Attachment 1 to appear on the ballot of the November 8, 2016, General Election and to otherwise carry out the purposes and intent of this Resolution. SECTION 4. EFFECTIVENESS OF RESOLUTION. This Resolution shall take effect immediately upon its adoption by the Common Council of the City and approval by the Mayor. BE IT FURTHER RESOLVED that this Resolution shall take effect upon adoption by the Council and approval by the Mayor. Adopted by the Common Council of the City of Springfield, Oregon, by a vote of ____ for and ____ against, this _____ day of July, 2016. _______________________________ Mayor ATTEST: _____________________________ City Recorder N:City/Resolution/General/TemplateforCity.doc Attachment 3 Version 1, Page 3 of 3 BALLOT TITLE CAPTION: Imposes 3% tax on marijuana retailers’ sale of marijuana items QUESTION: Shall the City of Springfield impose a 3% tax on the sale of marijuana items by a marijuana retailer? STATEMENT: Under state law, a city council may adopt an ordinance to be referred to the voters of the city imposing up to a three percent tax on the sale of marijuana items in the city by a licensed marijuana retailer. The Springfield City Council enacted an ordinance imposing at 3% tax on the sale of marijuana items by a recreational marijuana retailer. The ordinance does not become effective unless approved by the voters. If approved, this measure imposes a 3% tax on the sale of marijuana items sold within the City of Springfield by a licensed marijuana retailer. The tax would be collected at the point of sale and remitted by the marijuana retailer. The City of Springfield intends to use the net revenue from this tax for public safety purposes. If approved, Section 7.1002 would be amended to add a subsection (3): (3) The amount of tax levied for recreational marijuana shall be 3% of the gross taxable sales of marijuana items by a marijuana retailer. EXPLANATORY STATEMENT: Approval of this measure imposes a 3% tax on the sale of marijuana and marijuana items sold within the City of Springfield by state-licensed recreational marijuana retailers. Medical marijuana items sold to registered medical marijuana cardholders under the Oregon Medical Marijuana Program would not be taxed. Under state law, there are no restrictions on how the City may use the revenues generated by this tax. The City intends to use the revenue for public safety purposes. Measure 91 was adopted by Oregon voters in November 2014 and amended by the Oregon Legislature in 2015. Under Measure 91, the Oregon Liquor Control Commission must license the retail sale of recreational marijuana. ORS 475B.345 provides that a city council may adopt an ordinance imposing up to a three percent tax on the sale of marijuana items (which include marijuana concentrates, extracts, edibles, and other products intended for human consumption and use) by retail licensees in the city, but the council must refer that ordinance to the city’s voters at a statewide general election. The City of Springfield city council has adopted an ordinance imposing a 3% tax on the sale of marijuana items by an OLCC-licensed recreational marijuana retailer in the City of Springfield, and, as a result, has referred this measure to the voters. This ordinance does not become effective unless approved by the voters. Attachment 3 Version 2, Page 1 of 3 RESOLUTION NO. _______ A RESOLUTION REFERRING TO THE ELECTORS OF THE CITY OF SPRINGFIELD THE MEASURE OF ORDINANCE NO. _______ IMPOSING A 3% TAX ON MARIJUANA RETAILERS’ RECREATIONAL SALES IN SPRINGFIELD As the preamble to this Resolution, the Common Council of the City of Springfield, Oregon (the “City”) hereby recites the matters set forth below. To the extent any of the following recitals relates to a finding or determination which must be made by the Common Council in connection with the subject matter of this Resolution or any aspect thereof, the Common Council declares that by setting forth such recital such finding or determination is thereby made by the Common Council. The recitals, findings and determinations set forth herein constitute a part of this Resolution. (1) POLITICAL SUBDIVISION. The City is a municipality and political subdivision organized and existing under and pursuant to the laws of the State of Oregon and the 2001 Springfield Charter City (the “Charter”). (2) ORDINANCE IMPOSING 3% TAX ADOPTED BY COUNCIL. The Common Council of the City of Springfield has adopted Ordinance No. ____, imposing a 3% tax on the recreational sale of marijuana and marijuana items by a marijuana retailer. (3) REFERRAL TO VOTERS. ORS 475B.110 requires that an ordinance imposing a 3% tax on the sale of recreational marijuana be referred to the voters of the City at a statewide general election, the next of which will be held November 8 2016. NOW THEREFORE BE IT RESOLVED as follows: SECTION 1. APPROVAL OF BALLOT MEASURE IMPOSING A 3% TAX ON MARIJUANA RETAILERS’ RECREATIONAL SALES. The Common Council of the City hereby directs that at the General Election held November 8, 2016, there shall be submitted to the qualified electors of the City of Springfield the measure of Ordinance No. ______, imposing a 3% tax on the recreational sale of marijuana and marijuana items by a marijuana retailer. The Ballot Title is attached hereto as Attachment 1 (“the Ballot Title”), incorporated herein by reference. SECTION 2. SUBMISSTION TO ELECTIONS OFFICER. Not later than the 61st day before November 8, 2016, the City Recorder, as the Chief Elections Officer of the City, shall submit to the County Clerk for Lane County, Oregon, a statement of the ballot measure together with a certified copy of this Resolution and the Ballot Title, all in order that the measure may appear on the ballot for the General Election held on November 8, 2016. The City Recorder shall submit to the County Clerk all necessary Attachment 3 Version 2, Page 2 of 3 information, and shall do and perform all other acts and things necessary or appropriate, so that the measure shall appear on the ballot for such General Election. SECTION 3. ADDITIONAL AUTHORIZATIONS. The City Manager, the City Recorder, the City Finance Director, and the City Attorney, and each of them acting individually, are hereby authorized, empowered and directed, for and on behalf of the City, to do and perform all acts and things necessary or appropriate to cause the ballot measure set forth in Attachment 1 to appear on the ballot of the November 8, 2016, General Election and to otherwise carry out the purposes and intent of this Resolution. SECTION 4. EFFECTIVENESS OF RESOLUTION. This Resolution shall take effect immediately upon its adoption by the Common Council of the City and approval by the Mayor. BE IT FURTHER RESOLVED that this Resolution shall take effect upon adoption by the Council and approval by the Mayor. Adopted by the Common Council of the City of Springfield, Oregon, by a vote of ____ for and ____ against, this _____ day of July, 2016. _______________________________ Mayor ATTEST: _____________________________ City Recorder N:City/Resolution/General/TemplateforCity.doc Attachment 3 Version 2, Page 3 of 3 BALLOT TITLE CAPTION: Imposes 3% tax on marijuana retailers’ sale of marijuana items QUESTION: Shall the City of Springfield impose a 3% tax on the sale of marijuana items by a marijuana retailer? STATEMENT: Under state law, a city council may adopt an ordinance to be referred to the voters of the city imposing up to a three percent tax on the sale of marijuana items in the city by a licensed marijuana retailer. The Springfield City Council enacted an ordinance imposing at 3% tax on the sale of marijuana items by a recreational marijuana retailer. The ordinance does not become effective unless approved by the voters. If approved, this measure imposes a 3% tax on the sale of marijuana items sold within the City of Springfield by a licensed marijuana retailer. The tax would be collected at the point of sale and remitted by the marijuana retailer. If approved, Section 7.1002 would be amended to add a subsection (3): (3) The amount of tax levied for recreational marijuana shall be 3% of the gross taxable sales of marijuana items by a marijuana retailer. EXPLANATORY STATEMENT: Approval of this measure imposes a 3% tax on the sale of marijuana and marijuana items sold within the City of Springfield by state-licensed recreational marijuana retailers. Medical marijuana items sold to registered medical marijuana cardholders under the Oregon Medical Marijuana Program would not be taxed. Under state law, there are no restrictions on how the City may use the revenues generated by this tax. The City intends to use the revenue for public safety purposes. Measure 91 was adopted by Oregon voters in November 2014 and amended by the Oregon Legislature in 2015. Under Measure 91, the Oregon Liquor Control Commission must license the retail sale of recreational marijuana. ORS 475B.345 provides that a city council may adopt an ordinance imposing up to a three percent tax on the sale of marijuana items (which include marijuana concentrates, extracts, edibles, and other products intended for human consumption and use) by retail licensees in the city, but the council must refer that ordinance to the city’s voters at a statewide general election. The City of Springfield city council has adopted an ordinance imposing a 3% tax on the sale of marijuana items by an OLCC-licensed recreational marijuana retailer in the City of Springfield, and, as a result, has referred this measure to the voters. This ordinance does not become effective unless approved by the voters. Attachment 3 Version 3, Page 1 of 3 RESOLUTION NO. _______ A RESOLUTION REFERRING TO THE ELECTORS OF THE CITY OF SPRINGFIELD THE MEASURE OF ORDINANCE NO. _______ IMPOSING A 3% TAX ON MARIJUANA RETAILERS’ RECREATIONAL SALES IN SPRINGFIELD As the preamble to this Resolution, the Common Council of the City of Springfield, Oregon (the “City”) hereby recites the matters set forth below. To the extent any of the following recitals relates to a finding or determination which must be made by the Common Council in connection with the subject matter of this Resolution or any aspect thereof, the Common Council declares that by setting forth such recital such finding or determination is thereby made by the Common Council. The recitals, findings and determinations set forth herein constitute a part of this Resolution. (1) POLITICAL SUBDIVISION. The City is a municipality and political subdivision organized and existing under and pursuant to the laws of the State of Oregon and the 2001 Springfield Charter City (the “Charter”). (2) ORDINANCE IMPOSING 3% TAX ADOPTED BY COUNCIL. The Common Council of the City of Springfield has adopted Ordinance No. ____, imposing a 3% tax on the recreational sale of marijuana and marijuana items by a marijuana retailer. (3) REFERRAL TO VOTERS. ORS 475B.110 requires that an ordinance imposing a 3% tax on the sale of recreational marijuana be referred to the voters of the City at a statewide general election, the next of which will be held November 8 2016. NOW THEREFORE BE IT RESOLVED as follows: SECTION 1. APPROVAL OF BALLOT MEASURE IMPOSING A 3% TAX ON MARIJUANA RETAILERS’ RECREATIONAL SALES. The Common Council of the City hereby directs that at the General Election held November 8, 2016, there shall be submitted to the qualified electors of the City of Springfield the measure of Ordinance No. ______, imposing a 3% tax on the recreational sale of marijuana and marijuana items by a marijuana retailer. The Ballot Title is attached hereto as Attachment 1 (“the Ballot Title”), incorporated herein by reference. SECTION 2. SUBMISSTION TO ELECTIONS OFFICER. Not later than the 61st day before November 8, 2016, the City Recorder, as the Chief Elections Officer of the City, shall submit to the County Clerk for Lane County, Oregon, a statement of the ballot measure together with a certified copy of this Resolution and the Ballot Title, all in order that the measure may appear on the ballot for the General Election held on November 8, 2016. The City Recorder shall submit to the County Clerk all necessary Attachment 3 Version 3, Page 2 of 3 information, and shall do and perform all other acts and things necessary or appropriate, so that the measure shall appear on the ballot for such General Election. SECTION 3. ADDITIONAL AUTHORIZATIONS. The City Manager, the City Recorder, the City Finance Director, and the City Attorney, and each of them acting individually, are hereby authorized, empowered and directed, for and on behalf of the City, to do and perform all acts and things necessary or appropriate to cause the ballot measure set forth in Attachment 1 to appear on the ballot of the November 8, 2016, General Election and to otherwise carry out the purposes and intent of this Resolution. SECTION 4. EFFECTIVENESS OF RESOLUTION. This Resolution shall take effect immediately upon its adoption by the Common Council of the City and approval by the Mayor. BE IT FURTHER RESOLVED that this Resolution shall take effect upon adoption by the Council and approval by the Mayor. Adopted by the Common Council of the City of Springfield, Oregon, by a vote of ____ for and ____ against, this _____ day of July, 2016. _______________________________ Mayor ATTEST: _____________________________ City Recorder N:City/Resolution/General/TemplateforCity.doc Attachment 3 Version 3, Page 3 of 3 Version 3 BALLOT TITLE CAPTION: Imposes 3% city tax on marijuana retailers’ sale of marijuana items QUESTION: Shall the City of Springfield impose a 3% tax on the sale of marijuana items by a marijuana retailer? STATEMENT: Under state law, a city council may adopt an ordinance to be referred to the voters of the city imposing up to a three percent tax on the sale of marijuana items in the city by a licensed marijuana retailer. The Springfield City Council enacted an ordinance imposing at 3% tax on the sale of marijuana items by a recreational marijuana retailer. The ordinance does not become effective unless approved by the voters. If approved, this measure imposes a 3% tax on the sale of marijuana items sold within the City of Springfield by a licensed marijuana retailer. The tax would be collected at the point of sale and remitted by the marijuana retailer. If approved, Section 7.1002 would be amended to add a subsection (3): (3) The amount of tax levied for recreational marijuana shall be 3% of the gross taxable sales of marijuana items by a marijuana retailer. EXPLANATORY STATEMENT: Approval of this measure imposes a 3% tax on the sale of marijuana and marijuana items sold within the City of Springfield by state-licensed recreational marijuana retailers. Medical marijuana items sold to registered medical marijuana cardholders under the Oregon Medical Marijuana Program would not be taxed. There are no restrictions on how the City may use the revenues generated by this tax. Measure 91 was adopted by Oregon voters in November 2014 and amended by the Oregon Legislature in 2015. Under Measure 91, the Oregon Liquor Control Commission must license the retail sale of recreational marijuana. ORS 475B.345 provides that a city council may adopt an ordinance imposing up to a three percent tax on the sale of marijuana items (which include marijuana concentrates, extracts, edibles, and other products intended for human consumption and use) by retail licensees in the city, but the council must refer that ordinance to the city’s voters at a statewide general election. The City of Springfield city council has adopted an ordinance imposing a 3% tax on the sale of marijuana items by an OLCC-licensed recreational marijuana retailer in the City of Springfield, and, as a result, has referred this measure to the voters. This ordinance does not become effective unless approved by the voters.