Benefits for Burbank

[dropcap class=”kp-dropcap”]B[/dropcap]urbank may soon take advantage of the lucrative benefits that cannabis can bring, and it’s been a long time coming. The city council recently proposed placing a general-purpose sales tax on several types of businesses, including cannabis businesses, as a way of paying back Burbank’s growing debt.

The city hasn’t warmed up to cannabis much in the past. In January 2017, shortly after California residents voted to legalize recreational cannabis, the Burbank City Council shot down a proposal to place a cannabis sales tax on the November ballot. At that meeting, City Councilmember Jess Talamantes said that he believes the city is “rushing” into decisions and that it needs more time to fully analyze the situation. This happened, despite around 60 percent of Burbank citizens voting in favor of Proposition 64.

Burbank prides itself on avoiding some of the criminal activity that is seen in other areas of the greater Los Angeles area, and its leadership wants to keep it that way. This is part of the reason it has avoided regulating cannabis, for the most part. This year, the future looks brighter for potential cannabis businesses that wish to open up in Burbank.

On June 26, the Burbank City Council voted to direct city staff to develop and draft ordinances to impose a sales tax on cannabis businesses. The council also voted to set up a civilian committee to monitor the revenue generated from cannabis businesses, should the tax be approved by voters.

“Many California communities have implemented a cannabis business tax,” City Attorney Amy Albano said at the meeting. “There are various structures that can be pursued, depending on the types of allowed cannabis businesses, whether it be a grower, a medical cannabis provider or retail provider. Accurate estimates at this point are difficult, because it would depend on the quantity and popularity of the businesses that exist within our city limits of which there is currently none. Further, little information is available on what the impacts have been on California cities since their legalization.”

Cindy Giraldo, the city’s financial services director, told council members that city staff members believe that a general-purpose sales tax would be the most effective way to combat Burbank’s ongoing deficit, which is expected to reach $9.5 million during the 2022-23 fiscal year, reported the Los Angeles Times.

Should a sales tax be approved, Giraldo believes that it could help generate up to $20 million per year, supplementing the city’s 9.5 percent sales tax. Burbank’s existing sales tax on businesses in general generates about $33 million per year.

“There are various structures that can be pursued, depending on the types of allowed cannabis businesses, whether it be a grower, a medical cannabis provider or retail provider.”

The cost of placing a cannabis sales tax measure on the ballot would be around $65,000, which would easily be replaced with cannabis sales tax revenue within a year or less.

But the city is still waiting on more information. By the end of the discussion, Burbank Mayor Emily Gabel-Luddy and Councilmember Talamantes asked staff to bring back more information on a tax proposal. Cindy Giraldo, Burbank’s financial services director, said that in order for a sales tax on cannabis businesses, the city would have to change its current policy in place that bans cannabis businesses.

The movement in Burbank continues to roll at a slow pace, but it’s moving in the right direction. A glimmer of hope has now been ignited.