Marijuana Taxation and Regulation

Colantuono, Highsmith & Whatley has a robust practice advising cities and counties as they regulate California’s burgeoning marijuana industries.

With experienced practice group leaders in Pasadena and Grass Valley, we assist local governments in drafting tax, land use, business license and health and safety ordinances to tax and regulate commercial and personal cultivation, distribution, sales, dispensaries, delivery services, manufacturing, and testing. We advise our clients about state and federal legal developments affecting their authority.

We use an array of tools — including cost recovery — to enforce our clients’ rules against an industry which includes more than a few people with casual attitudes about the law. Tools include administrative citations, civil code enforcement actions, and criminal action in the few cases in which it is cost-justified. We work with lenders and landlords as well as dispensaries and other business operators to achieve compliance.

We help our clients recover legal fees and other enforcement costs, including administrative fines, court-ordered restitution, nuisance enforcement liens, receiverships and suits under the unfair business practices statute.

We are California’s leading experts on municipal revenues and have drafted many marijuana taxes and fees ordinances and advise on Proposition 64’s impact on sales taxes.

We are also skilled at defending our clients’ taxes, policies and enforcement actions in trial and appellate courts. Our recent appellate cases in this area include:

  • Urgent Care Medical Services v. City of Pasadena (2018) 21 Cal.App.5th 1086 [upholding City’s zoning ban on dispensaries];
  • City of Vallejo v. NCORP4, Inc. (2017) 15 Cal.App.5th 1078 [injunction against unpermitted dispensary];
  • California Cannabis Coalition v. City of Upland (2017) 3 Cal.5th 924 [amicus brief for local government organizations in case involving disputed initiative to permit dispensaries and alleged general tax];
  • City of Auburn v. Sierra Patient & Caregiver Exchange, Inc. (2013, 3rd DCA) [unpublished victory in injunction action against unpermitted dispensary].