San Bernardino and two cannabis business owners, who received approval to operate in the city as part of a controversial vote in 2016, have settled extensive and protracted legal proceedings.
Under two settlement agreements approved by the city council on Wednesday September 15, Thomas Bamber, who owns the Shatter Dispensary and Lounge on Fifth Street, and Qiang Ye, the owner of the Captain Jacks Dispensary on Hospitality Lane, will be more than 1 Pay $ 9 million in cannabis sales taxes between them.
In addition, the two will withdraw an election initiative they sponsored in 2022, which included a reduction in the city’s usage tax from 7.75% to 3%. The measure, if approved, would have cost $ 14 million annually in revenue from the city’s general fund.
In return, San Bernardino Bamber and Ye will issue the necessary cannabis business permits to anyone currently operating or hoping to operate on the ground.
Eventually, city officials will inspect both operators’ facilities within 60 days to ensure compliance, and there will be no on-site cannabis use or sales or use of alcohol without all required permits.
Councilor Juan Figueroa was absent from Wednesday’s vote.
Five years ago, voters approved of San Bernardino Measure O, a citizen-backed initiative that regulated commercial cannabis companies in the city. Bamber and Ye were allowed to operate under these guidelines, but the validity of the election measure was challenged in court.
San Bernardino temporarily banned all commercial cannabis activities in late 2017 while all parties awaited a court ruling on the matter.
In December 2017, David Cohn, Justice of the Superior Court of San Bernardino County, provisionally invalidated Measure O because it created a zonal monopoly on the sale of cannabis. A few months later, Cohn said Bamber and Ye could continue their work while an appeals court reviewed his electoral waiver.
San Bernardino voters approved new regulations for commercial cannabis in November 2018, and the following February city council issued more than a dozen permits under the new initiative known as Measure X, which did not allow operators with Measure-O licenses to commence compliance with the new rules.
In May 2020, an appeals court overturned Cohn’s ruling that Measure O was invalid.
Measure O city officials and business owners began negotiating settlements shortly thereafter.
According to a staff report prepared for the city council, Shatter and Captain Jacks are said to collectively generate more than $ 2 million in tax revenue for the city each year.