06-04-2019 Retail MarijuanaSlide 1
Advisory vote process and estimate on projected revenue from Marijuana excise and sales tax
City Council Meeting
June 4, 2019
Currently
Council placed an advisory vote on the November 2015 ballot to ask the question:
“Should the Federal Way City Council enact an ordinance allowing marijuana-related businesses within the City of Federal Way”
The results were:
Yes – 5,737 (38.62%)
No – 9,117 (61.38%)
15,486 ballots were counted
Process and timeline
If Council directs staff to move forward the following anticipated timeline will apply:
July 2 - City Council approves a Resolution establishing the ballot title and explanatory statement prepared by the City Attorney on whether to allow marijuana businesses in Federal
Way. Federal Way Advisory Vote: Proposition No. 1
*Once the Advisory Vote has been authorized, no further citizen comment is allowed pursuant to RCW 42.17A.555
Process and timeline, cont.
July 2 - City Council approves a Resolution directing the City Clerk to advertise for both Pro and Con Committee members and setting the date of appointments to July 16, 2019.
July 3 - City Clerk files Council Resolution with King County Elections to add Federal Way Advisory Vote Proposition 1 to the general election ballot.
July 3 - Press Release and Public Notice issued advertising for Pro/Con Committee applicants.
Process and timeline, cont.
July 12 - Pro/Con Committee letters of interest deadline to City Clerk by 5:00 p.m.
July 15 - City Council Special Meeting to interview Pro Committee applicants
July 16 - City Council Special Meeting to interview Con Committee applicants
July 16 - City Council Regular Meeting – Council Appoints 3 members to each Pro and Con Committees
July 22-26 - Pro/Con Committee Orientation and process overview with City Clerk and City Attorney’s Office
Process and timeline, cont.
August 13 - Deadline for Pro and Con Statements submitted directly to King County Elections
August 15 - Deadline for rebuttal statements submitted directly to King County Elections
Oct 16 - Ballots mailed
Nov 5 - Election Day
Nov 26 - Election Certified
Cost
The cost to the City for each election is billed after the election. The cost of the entire election is split among the cities based on the number of registered voters on the day of
the election.
Average cost for the entire election is usually > $200,000.
Adding an advisory vote is estimated to increase the total cost somewhere between $5,000 and $20,000 on a general election ballot.
Marijuana Excise Tax Distribution
RCW 69.50.54(2)(g)(i) - State share distribution: Not to exceed $15 Million in 2018, 2019, 2020, and 2021.
(1) 70% of $15M distributed based on per capita:
40% of 70% (or 28%) to Cities ($4.2M distributed on % of population), & 60% of 70% to Counties.
(2) 30% of $15M ($4.5M) distribution based on proportional share of total revenue by physical location of the retail.
Marijuana Excise Tax Distribution (Cont’d.)
$4.2M to cities based on per capita
Remainder to counties
$4.5M to cities and unincorporated areas based on sales
Projected Revenues
A. Sales tax. (City’s portion of sales tax rate 0.85%)
Gross sale of $1 Million = $8,500
Gross sale of $10 Million = $85,000
B. Projected Revenue
(1) State projects about $100,000 through the States share.
(2) Total projected revenue of $108,500 on $1 Million gross sales, or $185,000 on $10 Million gross sales.
C. Not restricted & no voter approval.
Marijuana Excise Tax Distribution
Questions?
Thank You!