CA: City Of Redding Proposes Cannabis Licensing Fee

Photo Credit: Ron Smith

The City of Redding is proposing to the city council that the annual licensing fee for cannabis related businesses be $27,900.

This proposal will go to city council April 17 for a final vote and a public forum.

The ordinance passed by the council will not go into place until April 19. If the council doesn’t decide on a licensing fee before then, the start date will be pushed back.

The City of Shasta Lake, a city that already has cannabis related businesses in action, charges between $1,700 – $5,445 a month for licensing.

The City of Shasta Lake’s finance manager said it has collected $72,000 in un-audited tax revenue from cannabis sales in January and February combined.

Tip of the Valley Gardens is a company trying to start a licensed cultivation business in Redding and was surprised by the $27,900 proposal.

“Yeah, we knew we were going to have to pay to play, for sure,” said Tip of the Valley Gardens owner, Matthew Hawk. “I was expecting somewhere around maybe $15,000 or $20,000.”

If this fee is passed, Hawk estimates a total cost of $100,000 for license and permitting with an added $200,000 to get the business started.

“The city needs to think that we also have to pay taxes,” Hawk said. “We have to pay fees to the state, we have to pay for attorneys, accountants, and everything that most normal businesses have to do and then some. There’s a lot more requirements on this industry because people are allowing us to do what we want to do, finally. And because they are allowing us to do what we want to do finally, they know that we will do whatever they want us to do.”

The city said these fees will pay for three employees. A building inspector, fire inspector, and a community service officer.

Hawk thinks the city will lose local interest with these fees.

“The large barrier financially definitely seems to allow more people from other areas that have more money, you know, people from LA or down south to come up here and kind of take over the industry,” said Hawk, “We want people in this industry that care about the community, that care about their neighbors that care about helping the community grow. Charge us what you want, but the fact is that if you create such a huge barrier you are not going to have local people in this industry.”