The Grass Valley City Council has taken the initial step to implement a commercial cannabis industry by agreeing on a fee for those who want to set up operations.
Tom Last, community development director, said the fee for a prospective cannabis businesses would be $4,631. The total number allowed will be 24 types of businesses. This includes: one retail storefront, two delivery, two nurseries, (cultivation), five distribution (business-to-business transfer), 10 manufacturing (edible, oil, salve, tincture products), two test labs (quality control) and two delivery services.
The fee passed in a 4-to-1 vote at Tuesday’s meeting.
The council must now begin the applicant screening process, and candidates can submit applications to the city website.
Diana Gamzon, executive director of the Nevada County Cannabis Alliance, spoke to council during the Zoom broadcast of the meeting. She recommended splitting the fee into two phases because it is a selection process. The first phase would have the applicant pay a $1,149 fee and the second would require the balance, $3,482.
“Four thousand six hundred dollars is an expensive lottery ticket for a business that is not guaranteed to be a selected applicant,“ Gamzon said in an email. ”We would have liked to have seen the fee broken up into two parts, first for the selection process and second for those that have advanced. Grass Valley is one of the few jurisdictions in the state to require an added tax based on the potency (THC over 17%) of products cultivated, manufactured and sold in Grass Valley and the impacts of this policy will be another item to follow as the industry develops.“
Because not every applicant can be selected, she said it would be far less costly to pay the initial fee. Should an applicant then be accepted, and are seriously committed to take the next step to launch a cannabis enterprise, they can pay the balance.
Gamzon added that while the fee rates were fair, she noted the cap on non-retail (business-to-business) operations is unique in Nevada County, and could place non-retail cannabis operations at a competitive disadvantage.
Last said it was the first time he was aware of a two-phase payment proposal.
“The fee structure looks great on all fronts, and the alliance was fine with it in the past,” Mayor Ben Aguilar said. “We’re not discussing policy tonight, but we can examine that in the future.”
Councilman Tom Ivy was the lone dissenting vote.
Ivy said later that he’s not against a fee or creating a commercial cannabis industry. However, he added that if government is to nurture the industry, then local growers, processors and retailers should have an equitable chance to make a return on their investment.
“Whether it’s cannabis or timber, I want to bring in a high quality industry to this county and cannabis generates more revenue than several alternatives,” he said.
William Roller is a staff writer for The Union. He can be reached at email@example.com