As expected, the Portland City Council voted unanimously to keep a 10 percent sales tax on recreational marijuana on the table Wednesday while dismissing a controversial proposed tax on medical marijuana.
A final vote on the sales tax, which officials said could translate to up to $ 4 million per year in new revenue, is scheduled for Oct. 22. Voters will decide on Nov. 4 whether to approve Measure 91, the statewide ballot measure that would make recreational marijuana legal in Oregon.
The City Council dismissed a second option to also tax medical marijuana, an unpopular proposal among both the elected officials and a half dozen residents who testified Wednesday.
“We should not tax medicine,” Commissioner Dan Saltzman said.
Commissioner Amanda Fritz said acting on the recreational tax ahead of the statewide decision is “a prudent measure.”
Portland would join 17 other Oregon cities that have enacted a similar tax ahead of the Measure 91 vote next month. The ballot language forbids cities from enacting taxes on marijuana, but many cities are betting that by approving the tax ahead of the vote they’re protected.
Chris Matthews testified before the council and decried the decision to preemptively tax pot as a money grab. “I think it’s a money play, I think it encourages black market sales,’ he said.
Matthews continued that the city doesn’t have the “right” to enact the tax, leading to a brief exchange with Commissioner Nick Fish.
“It’s not the law of the land,” Fish said of Measure 91. “In our form of government,” he continued, “It may be a court that has the final say.”
Jessie Sponberg, another resident who testified Wednesday, asked the council how much Portland’s legal costs would be to fight opposition to a sales tax if Measure 91 is indeed approved.
“That’s a fair question,” Mayor Charlie Hales responded, but said he didn’t know the answer.
In City Council documents posted late last week, the estimated annual cost of administering a new sales tax was $ 280,000 per year, with $ 150,000 of one-time setup costs.
But on Wednesday, Revenue Bureau director Thomas Lannom said the costs if Measure 91 is approved would be closer to $ 1 million. City officials said they would need to add more staff in the Office of Neighborhood Involvement to deal with expected regulatory complaints.
Prior to voting for the sales tax, Hales said the city expects “extraordinary costs” associated with regulating the marijuana industry locally. He said the state will saddle cities with extra costs. “This is not just about marijuana,” he said, “it’s about our relationship with state government.”
— Andrew Theen