The Humboldt County Board of Supervisors improperly expanded the scope of the county’s cannabis cultivation tax, a three-judge panel affirmed Thursday in California’s 1st District Court of Appeals.
The case involves amendments to Measure S, the county’s commercial cannabis cultivation tax, which voters approved in 2016. Thursday’s decision upholds last year’s trial court ruling, in which Humboldt County Superior Court Judge Kelly Neel found that the supervisors messed up by passing amendments that changed who and what is taxed as well as when taxes accrue under the measure.
Originally, the measure worked like this: Each person engaged in legal commercial cannabis cultivation in the county’s unincorporated areas had to pay a tax of $1 per square foot of outdoor cultivation area, $2 per square foot of mixed-light cultivation area or $3 per square foot of indoor cultivation area.
Amendments passed by the board in 2017 and 2018 changed it to where property owners were responsible for paying the tax, rather than growers, and the entire permitted growing area was subject to taxation, rather than just the area where cultivation was actually occurring. The amendments also changed when taxes start accruing — from the date when cultivation begins to the date when the county issues a permit, regardless of whether any growing ever takes place.
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