City Council members in Vista last week agreed to significantly lower the annual permit fees for cannabis dispensaries and said they were open to expanding cannabis sales for recreational use.
The city already allows 11 businesses to sell medicinal-use cannabis under Measure Z, approved by voters in 2018. The first legal shops opened in October 2019.
Annual permit fees fund financial audits for all cannabis businesses and quarterly inspections for the seven shops that provide delivery service and other functions.
Last week, council members approved a city staff recommendation to lower permitting fees after an analysis found they were higher than what was needed for the audits, inspections and other costs.
“We have a year under our belt, we have a better understanding of the costs involved, and we are required by state law to set these fees as close as possible to our demonstrated costs,” Councilman John Franklin said.
Beginning July 1, businesses subject to quarterly inspections will pay $19,967, or $8,000 less than the fee approved last June. Businesses that don’t require quarterly inspections will pay $11,128, or $11,800 less than the current fee.
In comparison, the Oceanside City Council last week approved $8,850 in annual fees for dispensaries in their city.
According to the analysis presented Tuesday, the Vista businesses had fewer non-compliance issues, complaints and service calls than anticipated when the fees were first set.
Three people spoke against lowering the fees in Vista.
Erica Leary, program manager for North Coastal Prevention Coalition, said more should be done to protect youth from marijuana on the state and local level, and Kelly McCormick suggested that the pandemic shutdown may have been a reason the businesses generated less costs to the city than expected.
High school sophomore Tyler James said many studies had shown marijuana can be harmful to young, developing brains, and he asked for more money to go toward education about its use.
Also during the meeting, Councilman Joe Green noted that fear of the unknown that preceded the passage of Measure Z had passed, and it was time to consider expanding what voters had supported.
Green said Measure AA, also passed in 2018, allows the council to set a tax rate of between 6 percent and 12 percent for recreational, adult-use dispensaries. He proposed a tax rate of 7 percent for adult-use, the same rate as medical use, and asked city staff members to return with a proposed ordinance that will allow the sale of cannabis for non-medical use.
He said the city would benefit from extra revenue from the businesses, which already had generated $5.2 million this year, and he estimated new businesses could create from $780,000 to $1.4 million more to help balance the budget and fund special projects and programs.
“Regardless of where you stand on the marijuana issue, we live in a state and in a city where the majority of voters have approved this,” Green said.
Franklin said he supported the idea because it made sense, and other council members agreed to ask staff to return with a proposed ordinance.
Speakers in favor of the change included Mike Mellano, owner of Coastal Wellness dispensary, and Justin Christman, co-owner of Flora Verde dispensary.
Mellano said having licensed, adult-use dispensaries would help drive away illegal dispensaries operating in the city because some people do not want to go through the hoops to qualify for medicinal use.
“We probably have 10 to 20 people who walk in and then walk out to the black market because they don’t want to get a medical card from a doctor and be on a list,” he said, adding that he also is concerned about keeping minors away from marijuana.
Christman said studies have shown that cannabis use among minors goes down in cities that have regulated dispensaries and no unlicensed shops.
“Let’s have a highly regulated, safe, adult-use market,” he said.
The three people who spoke earlier in the meeting against lowering licensing also spoke in opposition to allowing recreational use in the city.
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