The City of San Juan Bautista is expected to begin accepting applications from cannabis operators in March.
The city council voted unanimously Jan. 21 to rescind its 2017 ban on cannabis operations. At the same meeting, the council set tax rates on operations that were approved by voters in 2018’s Measure I.
Rates include $5 per square foot of cultivation space, 5 percent of gross receipts for retailers and 5 percent for manufacturers.
The rates are similar to what nearby jurisdictions charge. The City of Hollister, for instance, taxes 7 percent of gross receipts for retail establishments and $5 per square foot for cultivators.
Meanwhile, retail operations remain prohibited in unincorporated San Benito County, where cultivators are allowed and also taxed $5 per square foot.
In 2017, the city of San Juan Bautista hired Victor Gomez of Pinnacle Strategy on a $9,000 contract to help draft a cannabis policy. Gomez is currently under contract with San Juan Bautista to help develop a page on the city’s website for processing applications, according to City Manager Jim Reynolds.
“There has been some interest to operate but we will not start accepting applications until March 1,” Gomez said. “I do expect that the city will receive applications in the coming months.”
Operations are only allowed within land that is zoned industrial, which is south of Highway 156 within city limits and is roughly 25 acres in total.
As such, Gomez told the council that because of a limited amount of land, the city could expect to see more tax revenue from retail operations rather than cultivators. Like Hollister, San Juan Bautista is limiting retail cannabis establishments to two.
San Juan Bautista officials approved the ban on recreational cannabis in mid-2017 as a way to give the city time to draft an ordinance before the state began issuing cannabis business permits in January 2018. The city previously had established a medical cannabis dispensary ban in 2011.
The San Juan Bautista city council adopted its cannabis application rules and regulations policy in November. The January approval of tax rates marked the last steps the city needed to finalize before it could start accepting applications, Gomez said.
