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Distribution and Retail <br /> <br />AUMA establishes two business license types pertaining to distribution and two <br />business license types pertaining to retail. Distributors are engaged in the procurement, <br />sale, and transport of cannabis and cannabis products between entities licensed to <br />engage in recreational cannabis business. Retailers are engaged in retail sale and <br />delivery of cannabis and cannabis products to customers. <br /> <br />AUMA authorizes a local jurisdiction to ban or regulate distribution and retail locations <br />and/or deliveries within their borders. However, a local jurisdiction cannot prevent a <br />licensed entity from using public roads to simply pass through its jurisdiction to a <br />delivery location outside of its boundaries. <br /> <br />Impacts from distribution facilities and retail stores may include security issues, loitering, <br />nuisance, driving under the influence, and odor from smoking. In addition, retail stores <br />may generate conventional retail impacts on traffic and parking. <br /> <br />3) Ban or Regulate Medical Cannabis Business <br /> <br />MCRSA authorizes a local jurisdiction to ban or regulate all medical cannabis business <br />within their borders, except that lawful transportation of cannabis through its jurisdiction <br />cannot be prevented. Further, MCSRA requires applicants to have a local permit in <br />order obtain a state license to engage in medical cannabis business. Therefore, inaction <br />by a local jurisdiction is an effective ban (except medicinal cannabis deliveries must be <br />explicitly prohibited). <br /> <br />Presently, Redwood City has adopted an ordinance banning medical cannabis <br />distribution facilities in all zoning districts. The City has no other ordinance expressly <br />allowing or banning other types of medical cannabis business, so medical cannabis <br />deliveries are allowed. <br /> <br />Staff requests that Council consider whether it wishes to expressly ban or allow and <br />regulate, through business or land use regulations, medical cannabis business <br />pertaining to cultivation, manufacturing, testing, retail sales and distribution. The <br />impacts of these types of medical cannabis businesses are the same as the impacts of <br />recreational cannabis businesses discussed above. <br /> <br />4) Enact Local Taxes and/or Fees on Cannabis Business <br /> <br />Effective January 1, 2018, AUMA imposes a State excise tax at the rate of 15% of gross <br />retail sales receipts of cannabis. Also effective January 1, 2018, AUMA imposes a <br />separate cultivation tax on all harvested cannabis as follows: $9.25 per dry-weight <br />ounce on all cannabis flowers and $2.75 per dry-weight ounce on all cannabis leaves. <br />After reimbursing State agencies for the costs of regulation and implementation, $25 <br />million of the tax revenue generated from the State taxes are allocated to earmarked <br />sources, and the remaining tax revenue is distributed to youth programs, substance <br />8.B. - Page 6