On Tuesday March 7th, Measure M, the City Council backed ballot measure aiming to regulate cannabis businesses in Los Angeles passed by an overwhelming majority when over 80% of voters approved the measure. The LA City Council will be granted the authority to create and amend regulations concerning marijuana commercialization when it comes to the taxation of cannabis sales. In November, Californians voted for the approval of Prop 64, which was the legalization of marijuana in the state, but didn’t offer any kind of understandable explanation when it came to who could cultivate, extract, infuse, or distribute cannabis, and cannabis related products.
Now, a gross receipts tax of 5% will start being imposed on medical marijuana, and recreational cannabis will have a 10% gross receipts tax. Cultivation, manufacturing, transportation, and research will have a 1% gross receipts tax. The LA City Council can now issue permits and be responsible for cannabis transportation regulation as well. Measure M will also provide the industry a set of local laws and rules that will cover a number of different factors such as: what hours can cannabis businesses operate, and where can they be located?
The passage of Measure M effectively repeals the 2013 ballot initiative Proposition D, which outlawed medical cannabis dispensaries while at the same time giving “limited legal immunity” to approximately 135 existing dispensaries, considered to be Pre-ICO, because they were operating before the Interim Control Ordinance of 2007. The competing ballot measure, Measure N, would have mostly given control over to the 135 Pre-ICO dispensaries. It was voted against by 64% of voters. Most of those who had initially backed Measure N eventually began supporting M instead.