HomeMy WebLinkAboutCORRESPONDENCE - 75F75F
City Council Meeting Correspondence
6/4/2019
PUBLIC HEARING ON ORDINANCE AMENDMENT NO.2019-01 TO ADD TO AND AMEND CERTAIN
SECTIONS OF CHAPTER 21 OF THE SANTA ANA MUNICIPAL CODE TO ALLOW VERTICAL AND
HORIZONTAL INTEGRATION OF CANNABIS BUSINESSES; UPDATING PROCEDURAL STANDARDS
AND REQUIREMENTS RELATING TO OWNERSHIP TRANSFERS, SECURITY DEPOSITS, AND
VARIOUS ADMINISTRATIVE PROCESSES; AND REDUCING CANNABIS TESTING TAXES TO TWO
PERCENT OF GROSS RECEIPTS
Date of Name Representative of In Favor In Opposition Comment
Correspondence of RA*, of RA.*
1 61412019 Victoria Materia Medica Laboratories Yes
. 1
TOTAL:
*RA -Recommended Action
Tuesday, June 04, 2019 Page 1 of 1
Orozco, Norma
From: Materia Medica <
Sent: Tuesday, June 04, 2019 1:16 PM
To: eComment
Subject: Tuesday, June 4, 2019 - Item#75F. Cannabis testing lab
75F. PUBLIC HEARING - ORDINANCE AMENDMENT NO. 2019-01 TO ADD TO AND AMEND
CERTAIN SECTIONS OF CHAPTER 21 OF THE SANTA ANA MUNICIPAL CODE TO ALLOW
VERTICAL AND HORIZONTAL INTEGRATION OF CANNABIS BUSINESSES; UPDATING
PROCEDURAL STANDARDS AND REQUIREMENTS RELATING TO OWNERSHIP TRANSFERS,
SECURITY DEPOSITS, AND VARIOUS ADMINISTRATIVE PROCESSES; AND REDUCING
CANNABIS TESTING TAXES TO TWO PERCENT OF GROSS RECEIPTS {STRATEGIC PLAN NOS. 3,
2; 3, 3; 3, 5; 4, 3) - Finance and Management Services Agency; and Planning and Building Agency - Legal
Notice published in the Orange County Reporter May 24, 2019 and May 31, 2019.
To whom it may concern,
I am writing in support of item#75F of today's meeting topics, specifically regarding reducing cannabis testing
taxes to two percent of gross receipts. It is well known that testing labs require high capital invest due to
equipment costs and qualified chemist salaries. At the same time, testing labs are under significant pressure to
keep their invoices low, which means it could be years before a lab sees a return on their initial investment.
Lowering taxes on labs at least gives growing laboratories a chance to retain needed funds for continued
operation, capital investment, and loan repayment.
It is no secret that potency results are an important factor for retailers/distributors to consider due to consumer
preferences. This problem has been partially addressed at the state level by barring businesses from "shopping
around" testing laboratories to maximize their potency figures on regulatory compliance batches. Again, this
scenario assumes all retail cannabis falls under BCC regulation when that is clearly not the case, since black-
market sales are still a big problem in California. Cannabis labs are uniquely positioned as potential bottleneck
for the market yet smaller labs continue to face many challenges to survive in the industry when it is easy
enough to turn to serve other industries —the longer this remains an issue there will be greater problems for the
industry in the future. We applaud the City for considering alleviating at least some of those pressures on testing
labs.
Respectfully,
Victoria
Lab Manager
Materia Medica Laboratories, Inc.
Located in Santa Ana, CA