HomeMy WebLinkAbout10667ORDINANCE NO. 10667
AN ORDINANCE REPEALING SECTION 14-12-8(c) OF THE
PUEBLO MUNICIPAL CODE RELATING TO THE RETAIL
MARIJUANA EXCISE TAX RATE AND AMENDING SECTION 14-
12-2(a) OF THE PUEBLO MUNICIPAL CODE TO MODIFY THE
EXCISE TAX RATE TO TEN PERCENT
BE IT ORDAINED BY THE CITY COUNCIL OF PUEBLO, that: (brackets indicate
matter being deleted, underscoring indicates new matter being added)
SECTION 1.
Section 8(c) of Chapter 12 of Title XIV of the Pueblo Municipal Code is repealed.
Sec. 14-12-8. Maximum rate for retail marijuana excise tax.
The maximum retail marijuana excise tax rate that may be imposed pursuant to
this Chapter is fifteen percent (15%). At any time on or after January 1, 2016, the City
may, by ordinance:
(a) Establish another retail marijuana excise tax rate to be imposed
pursuant to this Chapter that is equal to or less than the maximum fifteen percent
(15%) tax rate provided in this Chapter; or
(b) After establishing a retail marijuana excise tax rate that is lower
than fifteen percent (15%), increase the tax rate to be imposed pursuant to this
Section; except that, in no event shall the City increase the retail marijuana
excise tax rate above fifteen percent (15%).
\[(c) On and after January 1, 2024 and for a period of three years
thereafter, the retail marijuana excise tax rate shall be decreased to zero percent
(0%). Unless this subsection (c) is sooner repealed, rescinded or otherwise
amended, the retail marijuana excise tax rate shall be increased to eight percent
(8%) and imposed effective on and after January 1, 2027.\]
SECTION 2.
Section 2 of Chapter 12 of Title XIV of the Pueblo Municipal Code is hereby
amended to read as follows:
Sec. 14-12-2. Imposition and rate of tax; taxes collected held in trust.
(a) Excise Tax. In addition to any other tax imposed by law including the sales
and use tax levied in Chapter 4 of this Title, there is levied and shall be paid and
collected an excise tax of \[eight\] ten percent (\[8\] 10%) or such other rate as may be
established pursuant to Section 14-12-8 of this Chapter on the average market rate of
unprocessed retail marijuana that is first sold or transferred from a retail marijuana
cultivation facility located within the City. The excise tax shall be levied and owed
irrespective of where delivery takes place.
(b) Each retail marijuana cultivation facility shall collect, remit and pay the
excise tax on the first sale or transfer of unprocessed retail marijuana. All sums of money
paid by a person as the additional excise tax on unprocessed retail marijuana imposed
by this Chapter are public monies that are the property of the City. The retail marijuana
cultivation facility shall hold such monies in trust for the sole use and benefit of the City
until paying them to the Finance Director.
SECTION 3.
The officers and staff of the City are authorized and directed to perform any and
all acts consistent with the intent of this Ordinance to effectuate the policies and
procedures described herein.
SECTION 4.
This Ordinance shall become effective on the date of final action by the Mayor and
City Council.
Action by City Council:
Introduced and initial adoption of Ordinance by City Council on February 26, 2024.
Final adoption of Ordinance by City Council on March 11, 2024.
APPROVED:
PRESIDENT OF CITY COUNCIL
Action by the Mayor:
☒ Approved on , 03/182024 .
□ Disapproved on based on the following objections:
Mayor
Action by City Council After Disapproval by the Mayor:
□ Council did not act to override the Mayor's veto.
□ Ordinance re-adopted on a vote of , on
□ Council action on _______ failed to override the Mayor’s veto.
President of City Council
ATTEST
City Clerk
City Clerk’s Office Item # R3
Background Paper for Proposed
Ordinance
COUNCIL MEETING DATE: February 26, 2024
TO: President Mark Aliff and Members of City Council
CC: Mayor Heather Graham
VIA: Marisa Stoller, City Clerk
FROM: Carla Sikes, Interim City Attorney
SUBJECT: An Ordinance repealing Section 14-12-8(c) of the Pueblo Municipal Code relating
to the retail marijuana excise tax rate and amending Section 14-12-2(a) of the
Pueblo Municipal Code to modify the excise tax rate to ten percent
SUMMARY:
The proposed Ordinance repeals Pueblo Municipal Code §14-12-8(c) which decreased the
retail marijuana excise tax rate from 8% to 0% for a period of three years and amends Pueblo
Municipal Code §14-12-2(a) to modify the retail marijuana excise tax rate to 5%.
PREVIOUS COUNCIL ACTION:
Voters approved Ordinance 8905 at the 2015 General Municipal Election which enacted Chapter
12 of Title XIV (“Retail Marijuana Excise Tax Ordinance”). The Ordinance allows City Council to
set the excise tax as long as it does not exceed 15%. On December 26, 2023, City Council
approved an Ordinance reducing the retail marijuana excise tax to 0% for a period of three years.
BACKGROUND:
On December 26, 2023, Council reduced the retail marijuana excise tax to 0% for a period of
three years. The voters approved the excise tax with the expectation that it would be assessed
at a rate up to 15%. The City has experienced a continual decrease in overall sales tax revenue
to the city budget. Reducing this alternate source of tax revenue will result in a loss of over half
a million dollars to the City over the three-year period.
In addition, Pueblo County assesses an excise tax of 5% on retail marijuana. Re-establishing a
5% excise tax on retail marijuana within the City of Pueblo will maintain a needed tax base while
still keeping the City competitive with the County as a location of marijuana grow operations.
FINANCIAL IMPLICATIONS:
Retail marijuana excise tax revenues were $159,601 in 2022, $147,985 in 2023 and budgeted for
$200,000 in 2024.
BOARD/COMMISSION RECOMMENDATION:
Not applicable to this Ordinance.
STAKEHOLDER PROCESS:
Not applicable to this Ordinance.
ALTERNATIVES:
Not approve the Ordinance in which case the retail marijuana excise tax rate shall remain at 0%
for three years.
RECOMMENDATION:
Passage of this Ordinance.
Attachments:
Proposed Ordinance.