Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Cannabis Tax topic
No spam. Unsubscribe anytime.
Arroyo Grande council places local cannabis business tax measure on November ballot
Summary
Council voted unanimously to place a measure on the Nov. 3, 2026 ballot that would authorize a local cannabis business tax of up to 10% of gross receipts; staff estimates a 6% rate could yield roughly $500,000 annually and would trigger follow‑up zoning and permitting work if voters approve.
Arroyo Grande City Council voted to place a local cannabis business tax measure on the Nov. 3, 2026 general municipal election ballot, clearing the way for voters to decide whether to allow commercial cannabis businesses and tax their gross receipts within city limits.
Management analyst Aaliyah Bergam told the council the proposed ballot language would authorize a maximum tax of 10% of gross receipts on permitted cannabis businesses and that, based on current projections, an initial 6% retail tax could generate roughly $500,000 a year. "The specific tax rate imposed would be set by the city council and may be adjusted over time within the voter‑approved maximum," Bergam said.
If voters approve the measure, staff said they would draft regulations to allow commercial retail cannabis uses and return with zoning and permit processes for council consideration. Bergam noted the measure is framed as a general tax and that proceeds would be deposited to the general fund for any lawful purpose, including public safety, road maintenance and recreation programs.
Council members debated implementation details and community impacts during the public discussion period. Council member Serest noted competing public views and said regulations are strict: "They're very strict regarding zoning. So I don't think we're talking about putting some huge thing out there." Council member Guthrie and others said nearby jurisdictions' experiences informed their support, while several members said any final decision ultimately rests with voters. Mayor Prom Marvelia and another council member volunteered to prepare a pro‑argument for the voter information guide.
The council made a motion to follow staff recommendations to (1) place the measure on the Nov. 3 ballot, (2) adopt the ordinance language subject to voter approval, (3) designate two council members to prepare a supporting argument, and (4) make the required procedural determinations. The motion passed on a roll call vote with the five council members recorded as voting yes.
Next steps: the measure will appear on the November ballot if the council's action is certified. If voters approve the measure, staff will prepare implementing regulations and a zoning/permit pathway for retail cannabis businesses.
