REP GREDC 004 2015/11/17 (2014-2016)

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REPORT OF THE COMMITTEE ON GOVERNMENTAL RELATIONS AND ECONOMIC DEVELOPMENT DATE: November 17, 2015 Re: Comm. No. 559/Res. No. 339-15 PLACE: Council Chambers Kona, Hawaii TIME: 9:51 a.m. Council Chair and Members Hawaii County Council Hilo, Hawaii 96720 Your Committee on Governmental Relations and Economic Development, to which was referred Resolution No. 339-15, reports as follows: Resolution No. 339-15, transmitted by Council Member Margaret Wille, via Communication No. 559, dated October 29, 2015, urges the Hawaii State Legislature to amend Act 241, relating to medical marijuana, to establish a county sales tax on medical marijuana sold at dispensaries. The amendment would allow each county, by ordinance, to impose a sales tax of up to five percent of the gross sales of any medical marijuana dispensary located within the county, which may be collected on a quarterly or annual basis. There were four people who testified on this resolution. One person from each of the following locations: Hilo, Ka`u, Kohala, Kona, and Pahoa. Both Resolution No. 338-15 and Resolution No. 339-15 were read in. A motion to approve Resolution No. 339-15 was made by Council Member Wille and seconded by Council Member Paleka. Council Member Wille expressed her thoughts regarding the tax issue. She said she's trying to make a statement that the burden is on the county. It doesn't say there will be a charge of five percent but it gives that option. At least this way, they recognize that there is going to be costs for the counties and maybe there should be some funding for the additional impacts to the counties. The big picture is trying to get us into the conversation on issues like location decisions; and social, cultural and fiscal impacts. Council Member Paleka stated it would be prudent to reserve the right for an appropriate tax and he would support reserving the right to levy some type of compensation to the county because of the responsibility and impact. GREDC Rept. No.: 4