A Burlingame ballot measure raising business licensing fees and taxes for non-storefront marijuana businesses to build revenue supporting city services is up for a vote in November.
The 5% tax on cannabis gross sales for delivery dispensaries, which could generate anywhere from $2 million to $4 million a year, said Councilmember Donna Colson.
“If it takes more than 30 minutes to get a legal distribution of marijuana, then they will go to the underground market,” said Colson, who found the statistic based on a study.“So, it’s less driven by cost and more driven by efficiency.”
Ease makes about 10,000 deliveries a year to Burlingame, she added.
The marijuana delivery dispensaries and downtown businesses were all supportive of the tax that will also help keep the drivers safe. However, she said the current City Council will not support retail cannabis stores in the city any time soon.
“Most of our clients here are happy and satisfied with the delivery, door to door, it’s more private, it’s probably safer to have it delivered to their own home,” said Colson.
Another change is the city’s business license fee. For the past 30 years, the city’s licensing fee was $100. If Measure X passes, it would increase business licensing fees ranging from $200 to $750. The highest rate would be on larger businesses.
“This just allows us to break it up so the biggest businesses and the smallest businesses aren’t paying the same,” said Colson.
Providing approximately $2.5 million of annual revenue for the city that lost $20 million in transient occupancy taxes from hotel stays during the pandemic. The city’s operating budget was around $75 million to $80 million in 2020, so this is an opportunity for the city to diversify its revenue, Colson added.
The revenue from the taxes will go toward fixing streets and sidewalks, enhancing police patrols and crime prevention, undergrounding power lines, repairing storm drains and for general government use, according to the city website.
Businesses that generate $250,000 income or lower will be charged $200 a year; $250,000 to $1 million will be charged $300; and $1 million and above will be charged $750.
About 7% of Burlingame’s 8,700 businesses fall in that $1 million or more category; 93% percent of the city’s businesses will pay under $300, Colson said.
For a business that makes more than $1 million, $750 might not sound like a lot of money. The reason the fee is so low is that multiple businesses in Burlingame, specifically the car dealerships, restaurants and coffee shops own multiple businesses and would burden them more than it would help the city, said Colson.
The downtown businesses are all fully supporting Measure X, she added.
Be the first to comment