Memorandum
Date: November 17, 2026
To: The Honorable Lake County Board of Supervisors
From: Patrick Sullivan, Treasurer - Tax Collector
Subject: Discussion of Cannabis Tax Rates
Executive Summary:
The Board of Supervisors has previously offered a 50% reduction on the effective cannabis cultivation tax rate. This reduction will expire at the end of this calendar year if your Board does not take any action.
Given inquiries to our office, we are bringing this item to Board to seek direction. This will provide the necessary confirmation for County staff and the cannabis industry stakeholders.
There are two standard options for your consideration:
1) No action. This will result in the sunset of the 50% reduction and next year taxes will be imposed at their standard rate.
2) Adopt a resolution with a percentage reduction. This would set the taxes next year at whatever rate your Board approves.
There is a third option that your Board could consider based on feedback received by our office.
3) Adopt a tiered or progressive tax structure. Your Board could consider offering a reduced tax rate for small operators. (e.g. 50% reduction on operations of an acre or less; or a reduced rate for small retail)
If your Board wishes to pursue an option requiring action, our office can work with appropriate County departments to return with the necessary documents for your consideration.
If not budgeted, fill in the blanks below only:
Estimated Cost: ________ Amount Budgeted: ________ Additional Requested: ________ Future Annual Cost: ________
Purchasing Considerations (check all that apply): ☐ Not applicable
☐ Fully Article X. <https://library.municode.com/ca/lake_county/codes/code_of_ordinances?nodeId=COOR_CH2AD_ARTXPU_S2-38EXCOBI>- and/or Consultant Selection Policy <http://lcnet.co.lake.ca.us/Assets/Intranet/Policy/Policies+$!26+Procedures+Manual/Ch4_2021v2.pdf>-Compliant (describe process undertaken in “Executive Summary”)
☐ Section 2-38 <https://library.municode.com/ca/lake_county/codes/code_of_ordinances?nodeId=COOR_CH2AD_ARTXPU_S2-38EXCOBI> Exemption from Competitive Bidding (rationale in “Executive Summary,” attach documentation, as needed)
☐ For Technology Purchases: Vetted and Supported by the Technology Governance Committee <http://lcnet.co.lake.ca.us/Assets/Intranet/Intranet+Forms/Information+Technology/AdvPlan.pdf> (“Yes,” if checked)
☐ Other (Please describe in Executive Summary)
Consistency with Vision 2028 <http://www.lakecountyca.gov/Government/Directory/Administration/Visioning/Vision2028.htm> (check all that apply): ☐ Not applicable
☐ Well-being of Residents ☐ Public Safety ☐ Disaster Prevention, Preparedness, Recovery
☐ Economic Development ☐ Infrastructure ☐ County Workforce
☐ Community Collaboration ☐ Business Process Efficiency ☐ Clear Lake
Recommended Action: Provide direction.