Op/Ed: Yes on Measures S and G

Facts matter in an election. People on both sides of an issue will passionately share their views, trying to get others to vote their way. It is more important now than ever to weed through the rhetoric before the ballots are marked with that important checkmark.

Measure G

There is an important measure on the ballot for the City of South Lake Tahoe residents, a possible tax on cannabis, Measure G.

This isn't really a new fee and it's an administrative measure that will allow the City to streamline the collection of an existing cannabis business fee with a comparable tax. This was worked on with the engagement of local cannabis businesses. This tax is a local business and professions tax, authorized under state law, and is applicable only to cannabis businesses. It is not a sales tax and all funds raised through this will remain in South Lake Tahoe.

Since March 7, 2019, South Lake Tahoe has had a robust cannabis ordinance that opened the door to retail sales, cultivation, manufacturing, and lab testing businesses.

Cannabis businesses currently pay a flat annual fee for their ten-year development fee, set to expire between 2029-2030, depending on when the business was licensed. It cannot be changed should a business experience a downturn in sales, and that is where Measure G comes in as a possible benefit. While yes, it streamlines what the finance staff is required to do, it also gives cannabis business owners the chance to pay less with a comparable tax.

If passed, this new tax rate would start off at the same rate as the current fee: 6 percent of gross receipts for cannabis retail, distribution, and manufacturing, and $20 per square foot of canopy of cultivation (see analysis here). As stated, this is an excise tax to be paid by the businesses and not a sales or use tax imposed directly on consumers. The 6 percent tax rate would be a maximum rate that could be adjusted up or down by a resolution of the City Council up to this maximum rate.

Measure G allows for a change in what businesses are already paying - a comparable large flat fee, but the word "tax" is what is drawing a flag and blanket dissent from those against a rise in taxes.

If Measure G fails, the cannabis owners will still pay a development fee, no matter what the economy is, no matter if sales start to drop. If it passes, their fee would no longer be a flat fee and they could see relief (which should pass on to the customer).

For more information on Measure G, visit https://www.cityofslt.us/1259/Measure-G.

Measure S

This measure is for El Dorado County voters who are being asked to raise the Transient Occupancy Tax (TOT). East Slope (Lake Tahoe side) would raise TOT by four percent to 14 percent tax on all hotel, motel, and Vacation Home Rental (VHR) stays (all lodging). Funds raised would be spent entirely on snow removal and maintenance of existing roads in the Tahoe area.

The West Slope voters are voting on a rise in TOT by two percent, from 10 percent to 12 percent. It would be spent entirely on the maintenance of existing roads on the West Slope.

The TOT tax has been at 10 percent for both areas since 2004 when voters approved it.

South Shore locals and second-home owners will benefit from better roads and snow removal services, and the tab would be picked up by the tourist.

For the Tahoe area - the increase in the TOT rate from 10 percent to 14 percent would generate an estimated $2.5 million in additional revenue annually. It would be spent entirely on snow removal and maintenance of existing roads in the Tahoe area.

For the West Slope - the increase in the TOT rate from 10 percent to 12 percent would generate an estimated $340,000 in additional revenue annually. It would be spent entirely on the maintenance of existing roads on the West Slope.

That means, if both measures pass, the combined estimated funding dedicated to road maintenance and snow removal would be $2,840,000, which would reduce the reliance on the County General Fund for road maintenance. Ideally, maintenance of roadways would require several times that figure, but proceeds from this tax increase would allow significant improvement in the level of service the Department of Transportation will be able to provide.

For more on Measure S, visit HERE.