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File Number: 16-530 <br />Oakland location and transport product to San Leandro as needed. Blum SL would also like <br />to relocate its laboratory and manufacturing operations for its IVXX brand to the remaining <br />8,300 square feet of the site. <br />Community Benefits <br />As part of its community benefits program, Blum SL offers to self-impose a five percent (5.0%) <br />gross receipts fee that it will voluntarily provide to the City’s General Fund. Blum SL further <br />states that if San Leandro voters adopt a local cannabis business tax (such as Measure NN), <br />that it will fully comply with the tax in lieu of the voluntary gross receipts percentage <br />contribution. Blum SL also offers to create a community grants program that will “provide <br />grants to programs and institutions in which the City of San Leandro has already invested.” <br />Local Cannabis Tax Discussion <br />The City’s first and second dispensary permits that were awarded to Harborside San Leandro <br />(HSL) and Davis Street Wellness Center contained conditions of approval stating that their <br />community benefits commitments would be nullified if San Leandro voters approved a <br />measure to impose a medical cannabis business tax. A similar condition of approval is <br />incorporated into the attached resolution. As such, if San Leandro voters authorize Measure <br />NN as part of the upcoming November 2016 election, the above community benefits <br />commitments would be nullified. The permit awarded to HSL also contained a provision that if <br />the City were “to award more than one medical cannabis dispensary permit, all subsequent <br />medical cannabis dispensary permits awarded or approved by the City shall include no less <br />than that which is required or conditioned by this resolution.” Given that Blum SL offered a <br />robust community benefits package that meets or exceeds the community benefits package <br />offered by HSL, this condition is addressed through the following condition of approval that is <br />included in the attached draft resolution: <br />“Permittee shall comply with, effect, and further all of the commitments, statements of <br />intent, and promises, including but not limited to its community benefits commitments, <br />contained in its application to operate a medical cannabis dispensary, which are <br />incorporated herein and made a part hereof as an attachment to this resolution.” <br />Conclusion <br />Blum SL demonstrated that it has the knowledge, skills, expertise, and access to capital to <br />operate a successful dispensary in San Leandro, in addition to committing to provide <br />extensive benefits to the San Leandro community. <br />Fiscal Impacts <br />The City will collect a $60,000 annual dispensary permit fee 30-days after Blum SL <br />commences dispensary operations. The permit fee is designed to off-set the City’s costs in <br />regulating the dispensary’s operations. <br />The facility will also generate annual sales tax receipts, of which the City will receive 1.5%, as <br />well as a 5% voluntary contribution to the City’s General Fund. If San Leandro voters <br />authorize Measure NN as part of the upcoming November 2016 ballot, the City Council would <br />have the authority to impose a tax of up to 10% of the dispensary’s annual gross receipts. <br />ATTACHMENTS <br />Page 4 City of San Leandro Printed on 10/11/2016