Silicon Valley is embracing cannabis business and Campbell is preparing to join the wave. But it might not be moving fast enough to cash in.

Although a rash of South Bay cities rushed to implement restrictions or outright bans on pot sales before the state opened recreational marijuana sales on Jan. 1, some are now angling to capitalize on the billion-dollar crop. During the latter part of 2017, cities from Los Gatos to Santa Clara imposed strict guidelines limiting—or in some cases like Saratoga’s, banning—marijuana cultivation and sales. Under Proposition 64, which state voters overwhelmingly approved in 2016 to legalize recreational marijuana use and sales, cities have the option to regulate how cannabis is handled.

In a special election last April, voters in Campbell authorized the city to create an ordinance to collect gross receipt taxes on marijuana businesses for the city’s coffers. City Manager Brian Loventhal told the Mercury News before the election that “operation of three dispensaries could hypothetically generate anywhere from $130,000 to $260,000 in annual revenue—money that would go toward city services such as police, fire and code enforcement.”

Voters agreed, but with mixed results. Measure A, which authorized the ordinance, passed with 84.51 percent voting yes. Another, Measure C, which sought a moratorium on cannabis dispensaries in the city until April 1, 2019, passed with 63.10 percent of the votes. Only Measure B, which sought permission for three medical marijuana dispensaries, delivery and cultivation of medical marijuana and regulations governing dispensaries and cultivation, was defeated, by a vote of 63.52 percent.

According to Paul Cambra of the California Department of Tax and Fee Administration, cannabis consumers are already paying state taxes wherever they buy the weed and “cannabis is subject to sales tax, the rate of which can be anywhere from 7.25 percent to 10.25 percent, depending on where you live.

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The state’s rate chart says cannabis buyers in Campbell should have a 9.25 percent state sales tax on their products. “Cities can add on local cannabis business taxes as well,” Cambra added.

That’s precisely what Campbell is doing.

At its Feb. 20 meeting, the Campbell City Council adopted an ordinance that sets the local sales tax on pot at 7 percent once sales are allowed and requires monthly reporting and collection of those sales. Council agreed to cap potential sales tax only as high as 15 percent, but currently the sales tax remains at 7 percent.

The new tax ordinance would be effective 30 days after approval, though the 2019 moratorium means the city won’t see big revenues until it lifts completely. For now, delivery of cannabis within city limits is allowed under certain rules, like needing a permit to operate a delivery service. A quick online search of cannabis businesses within Campbell’s city limits identifies about 25 delivery companies, but it remains to be seen if all of them will comply with the city rules.

According to Campbell police Sgt. Dan Livingston, just two delivery businesses operating in Campbell have a permit to do so: Harborside Dispensary and GWS Health, doing business as The Guild. Both are San José businesses, where recreational cannabis sold to those age 21 and older has been allowed since Jan. 1. According to the city’s website, there are 16 registered collectives in San José.

Livingston wants companies operating without permits not to be afraid to make contact.

“Some business owners simply aren’t aware that if you’re in the cannabis delivery business in Campbell, you need a permit,” Livingston explained. “It’s a very simple process, the permit is free, and we encourage business owners to reach out to us.”

Find the police department contacts at: ci.campbell.ca.us/522/Permits.

But cannabis lobbyists like Sean Kali-Rai, president and founder of the Silicon Valley Cannabis Alliance, predicts that the city’s careful step-by-step process may put it behind the other area cities rapidly responding to the Green Rush.

“Mountain View, Milpitas, Santa Clara are all moving forward,” Kali-Rai said by phone. “I worked with San Jose for four years to be ready, they’ve put themselves ahead of the curve and are leading the way.”

Asked if he advised the city of Campbell, Kali-Rai said, “The moratorium scared me away.”

While cities throughout Silicon Valley are each assessing which direction to take now that marijuana is legal in the state, the real test, Kali-Rai contends, will be what the first quarter sales results are for the state.

According to Cambra, the state should have that information by May.

“Taxes are reported quarterly. The first quarter returns are due April 30, and we generally have our reports for the quarter complete by the 10th of the following month,” Cambra added.

Last year, the state of Washington collected $315 million in marijuana sales taxes since legalizing in 2014, Oregon collected $108.6 million in pot sales tax by August since legalizing in 2015 and Colorado brought in $247 million in cannabis sales tax.