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Bill aims to tax licensed marijuana grows to provide funds for law enforcement

House Bill 2382 was proposed by the Josephine County Commissioners. The bill would allow 5 counties in Oregon to tax medical and recreational marijuana in their counties.

Posted: Mar 20, 2019 7:06 PM
Updated: Mar 21, 2019 3:13 PM

SALEM, Ore. — House Bill 2382, or the "Law Enforcement Stability Act," was proposed by the Josephine County Commissioners. The bill would allow certain counties in Oregon to tax medical and recreational marijuana in their counties.

Licensed marijuana farms, like Siskiyou Sungrown in Williams, already pay a fee each year to the state. This bill would add an additional tax but to the county. Medical marijuana grows would be taxed $50 per plant while recreational marijuana grows would be taxed $1 per square foot.

Cedar Grey has been very active in the cannabis industry for almost two decades now. He's had Siskiyou Sungrown since 2014. Last year, he said he was appointed by Governor Brown to the nine-member Oregon Cannabis Commission. It advises agencies and Oregon on marijuana policies. He's absolutely against this bill. With this bill, his two farms would pay a tax of $80,000 combined to Josephine County.

"Cannabis farms are already losing money. This is a highly saturated market in a new and volatile industry and we're already the most heavily taxed industry in the nation,” said Siskiyou Sungrown’s CEO and Founder Cedar Grey. “IRS tax code 280E eliminates most deductions for cannabis companies which makes it very difficult to profit even under the best circumstances.”

Josephine County's legal counsel Wally Hicks said that money each year would go toward law enforcement in those counties. With these additional funds, the county hopes the Josephine County Sheriff's Office could crack down on illegal marijuana grows, which Hicks said the county is riddled with.

"If the counties are going to have a legitimate licensure program for producing marijuana then they have got to enforce laws pertaining to producing unlicensed marijuana," Hicks added.

Grey knows the Josephine County Sheriff's Office doesn't have the resources to get rid of those illegal farm, but he said there is a better way to getting funds from the fee grows already pay to the state.

"We would like to see a reworking of the formula which distributes the Oregon Cannabis Tax. Right now, the formula is heavily weighted toward northern counties with their heavy retail presence. We would like to see a reworking of that distribution formula so that more funding was dedicated to producer counties like Josephine," Grey said.

The bill is currently sitting in the Oregon House. Before this bill becomes law, it would need to pass in the Oregon House and Senate. Governor Brown would also need to sign it. Residents in those five counties would also need to vote for that tax.

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