Long Beach Municipal Code Div. II Imposition of Business License Tax

There are hereby imposed upon the businesses, trades, professions, callings and occupations specified in this Chapter license taxes in the amounts hereinafter prescribed. It shall be unlawful for any person to transact and carry on any business, trade, profession, calling or occupation in the City without first having procured a license from said City to do so and paying the tax hereinafter prescribed and without complying with any and all applicable provisions of this Code, and every person conducting any such business in the City shall be required to obtain a business license hereunder.

This Section shall not be construed to require any person to obtain a license prior to doing business within the City if such requirement conflicts with applicable statutes of the United States or of the State of California.

Any person who engages in any business for which a business license is required, shall be liable for the amount of all taxes and penalties applicable from the date of commencement of the business, whether or not such person would have qualified for such business license; however, such payment shall not create any right for the person to remain in business.

All payments of business license tax received by the City, irrespective of any designation to the contrary by the taxpayer, shall be credited and applied first to any penalties and tax due for prior years in which the tax was due but unpaid.

(Ord. C-7783 § 2, 2002: Ord. C-6259 § 1 (part), 1986)

Every person engaged in the business of contract construction in the City of Long Beach shall pay an annual business license tax to the City consisting of a flat tax of two hundred forty-four dollars and fifty-eight cents ($244.58), plus an additional tax in the amount of twelve dollars and seventy cents ($12.70) for each employee of such business based on its average number of employees (based upon CPI base year 2000).

(Ord. C-7783 § 3, 2002: Ord. C-6837 § 1, 1990: Ord. C-6259 § 1 (part), 1986)

Every person engaged in the business of manufacturing in the City of Long Beach shall pay an annual business license tax to the City consisting of a flat tax of two hundred forty-four dollars and fifty-eight cents ($244.58), plus an additional tax in the amount of six dollars and thirty-five cents ($6.35) for each employee of such business based on its average number of employees (based upon CPI base year 2000).

(Ord. C-7783 § 4, 2002: Ord. C-6837 § 2, 1990: Ord. C-6259 § 1 (part), 1986)

Every person engaged in the business of miscellaneous business in the City of Long Beach shall pay an annual business license tax to the City consisting of a flat tax of two hundred forty-four dollars and fifty-eight cents ($244.58), plus an additional tax in the amount of six dollars and thirty-five cents ($6.35) for each employee of such business based on its average number of employees (based upon CPI base year 2000).

(Ord. C-7783 § 5, 2002: Ord. C-6837 § 3, 1990: Ord. C-6259 § 1 (part), 1986)

Notwithstanding any other provision of this Chapter 3.80, the provisions of this Section 3.80.221 and Section 3.80.223 shall apply to the business license tax on the business of oil production.

A. Every person conducting, managing or carrying on the business of oil production from any well located in the City, including the City when functioning in the capacity of a unit operator, shall pay an annual maximum business license tax to the City of thirty cents ($0.30) per barrel produced, subject to annual adjustments for inflation/deflation. In the event that the price per barrel on the monthly average of the daily WTI (West Texas Intermediate Crude Index) is reported in an amount less than twenty dollars ($20.00) for any month, the rate of this general tax on oil production as described above shall be temporarily suspended only for that same month. In the event that the WTI ceases to exist or otherwise becomes impractical to use, the City shall substitute an index which is reasonably comparable. For the purposes of this Section, the general tax shall be automatically adjusted on June 1st of each year, upward or downward, equivalent to the most recent change in the annual average of the Consumer Price Index as published by the United States Department of Labor for the Los Angeles-Riverside-Orange County, CA, area ("CPI"). For purposes of calculating the annual inflation/deflation factor under this Section, the base year shall be the year ended December 31, 2019. Rates shall first be adjusted on June 1, 2021, and annually thereafter, based upon the annually calculated change from the base year. The June 1, 2021 adjustment shall be for the change in the CPI for the year ending December 31, 2020, and the adjusted rate shall first be applied to the entire payment due on December 31, 2021.

B. The sum or sums paid shall be on a per fiscal year basis, payable quarterly. Production for the three (3) months immediately prior to the quarter month shall constitute the measurement of the amount due on or before the last day of the quarter month.

The applicant who fails to pay such production tax within the quarter month shall pay in addition to the taxes a penalty for nonpayment in the sum equal to twenty-five percent (25%) of the total amount on the first day of the month following the close of the calendar quarter. Additional penalties will be assessed in the following manner: ten percent (10%) shall be added on the first day of each calendar month following the month of the imposition of the twenty-five percent (25%) penalty if the tax remains unpaid; up to a maximum of one hundred percent (100%) of the tax payable on the due date.

C. The person subject to the payment of the tax shall, before the business tax for each quarter becomes delinquent, file with the director of financial management a written statement setting forth the number of barrels of oil produced by each well during the pertinent three (3) month period of production upon which the tax due is to be calculated, and such person shall pay at such time the amount of the business tax computed upon the measure of the tax reported in the statement. The written statement shall be made upon a form prescribed by the director of financial management and shall include a declaration substantially as follows:

"I declare under penalty of making a false declaration that I am authorized to make this statement, and that to the best of my knowledge and belief it is a true, correct and complete statement made in good faith for the period stated, in compliance with the provisions of the Long Beach Municipal Code."

Such statements shall not be conclusive against the City as to the information set forth therein, nor shall the filing of a statement preclude the City from collecting by appropriate action any additional tax that is later determined to be due and payable.

D. For the purpose of this Section a well shall be deemed to be located in the City if the surface location of the well or the surface of the well itself, is located in the City regardless of where the hole of the well may be bottomed.

E. For the purpose of this Section "oil" has the meaning as defined in Section 12.04.300.

F. The payment of the license as provided in this Section shall permit the engaging in any of the following businesses without the payment of an additional business license tax: oil well, injection well, or water source well drilling or servicing operations; refining oil or petroleum products and producing the byproducts thereof; marketing, selling and distributing oil or any petroleum products or byproducts thereof at wholesale; or maintaining tankage in connection with any of the above business activities; except that nothing in this Section shall be deemed to apply to the operation of automobile filling/service stations.

G. REPEAL OR AMENDMENT OF SECTION. This Section may be repealed or amended by the City Council without a vote of the People of the City of Long Beach. However, as required by California Constitution Article XIIIC (Proposition 218), voter approval is required for any amendment or provision that would increase the maximum rate or methodology of any tax levied pursuant to this Section. The people of the City of Long Beach affirm that the following actions shall not constitute an increase of the rate or methodology of the general Oil Barrel Production (Barrel) Tax requiring subsequent voter approval:

(a) The restoration of the rate of the tax to a rate that is no higher than the maximum set by this voter-approved section, if the City Council has previously acted to reduce the rate of the tax;

(b) An action that interprets or clarifies the methodology of the tax, or any definition applicable to the tax, so long as interpretation or clarification (even if contrary to some prior interpretation or clarification) is not inconsistent with the language of this section;

(c) The establishment of a class of person or service that is exempt or excepted from the tax or the discontinuation of any such exemption or exception (other than the discontinuation of an exemption or exception explicitly set forth in this section); and

(d) Resuming collection of the tax imposed by this section, even if the City had, for some period of time, either suspended collection of the tax or otherwise failed to collect the tax, in whole or in part.

(Measure US § 1, 2020; Ord. C-6751 § 1, 1990; Ord. C-6259 § 1 (part), 1986)

Editor's note— Section 5 of Measure US states: Pursuant to California Constitution Article XIIIC §(2)(b) and California Elections Code §9217, this Ordinance shall take effect only if approved by a majority of the eligible voters of the City of Long Beach voting at the General Municipal Election to be held on November 3, 2020, and shall become effective as of October 1, 2021.

Notwithstanding any other provision of this Chapter, the provisions of this Section shall apply to the business of oil production, in addition to those provisions set forth in Sections 3.80.221, 3.80.223 and 3.80.226.

A. Every person conducting, managing or carrying on the business of oil production from any well located in the City, including the City when functioning in the capacity of a unit operator, shall pay a special tax to the City of twenty-five cents ($0.25) per barrel produced, subject to annual adjustments for inflation/deflation. In the event that the price per barrel on the monthly average of the daily WTI (West Texas Intermediate Crude Index) is reported in an amount less than twenty dollars ($20.00) for any month, the rate of this special tax on oil production as described above shall be temporarily suspended only for that same month. In the event that the WTI ceases to exist or otherwise becomes impractical to use, the City shall substitute an index which is reasonably comparable. For the purposes of this Section, the special tax shall be automatically adjusted on June 1st of each year, upward or downward, equivalent to the most recent change in the annual average of the Consumer Price Index as published by the United States Department of Labor for the Los Angeles-Riverside-Orange County, CA, area ("CPI"). For purposes of calculating the annual inflation/deflation factor under this Section, the base year shall be the year ended December 31, 2006. Rates shall first be adjusted on June 1, 2008, and annually thereafter, based upon the annually calculated change from the base year. The June 1, 2008 adjustment shall be for the change in the CPI for the year ending December 31, 2007, and the adjusted rate shall first be applied to the entire payment due on September 30, 2008.

B. The sum or sums shall be payable quarterly and concurrently with the business license tax established in Section 3.80.221. Production for the three (3) months immediately prior to the quarter month shall constitute the measurement of the amount due on or before the last day of the quarter month.

The applicant who fails to pay such special tax within the quarter month shall pay, in addition to the special tax and the tax and penalties described in Section 3.80.221, a penalty for nonpayment in the sum equal to twenty-five percent (25%) of the total amount of this special tax on the first day of the month following the close of the calendar quarter. Additional penalties will be assessed in the following manner: ten percent (10%) shall be added on the first day of each calendar month following the month of the imposition of the twenty-five percent (25%) penalty if the special tax remains unpaid; up to a maximum of one hundred percent (100%) of the special tax payable on the due date.

C. The same filing requirements set forth in Subsection 3.80.221.C shall apply in their entirety to taxes imposed pursuant to this Section.

D. For the purpose of this Section, a well shall be deemed to be located in the City if the surface location of the well or the surface of the well itself, is located in the City regardless of where the hole of the well may be bottomed.

E. For the purpose of this Section, "oil" has the meaning as defined in Section 12.04.300.

F. The payment of the special tax as provided in this Section and the tax set forth in Section 3.80.221 shall permit the engaging in any of the following businesses without the payment of an additional business license tax: oil well, injection well, or water source well drilling or servicing operations; refining oil or petroleum products and producing the byproducts thereof; marketing, selling and distributing oil or any petroleum products or byproducts thereof at wholesale; or maintaining tankage in connection with any of the above business activities; except that nothing in this Section shall be deemed to apply to the operation of automobile filling/service stations.

(Prop. H, 5-1-07, eff. 5-22-07)

A. In those situations where the City is serving in the capacity of a unit operator, and as such is required to pay the tax as provided in Section 3.80.221, the computed total amount of the tax due shall be paid by the City, as unit operator, and by its drilling and operating contractor in the proportion as determined by the pertinent provisions of the drilling and operating contract between the City and the contractor.

B. This Section shall, in its application both as to past collected or accrued and to future taxes, be deemed severable from Section 3.80.221 in that should all or any portion of this Section be held to be unlawful or unconstitutional the intention of the City is declared to be that the respective systems of taxation described in Section 3.80.221 are of independent significance and should remain independently in full force and effect.

(Ord. C-6259 § 1 (part), 1986)

The special tax proceeds may only be used for Police Officers and Firefighters, and related costs including, but not limited to, equipment, facilities and training, all intended to ensure responses to public safety needs, natural and man-made disasters and possible acts of terrorism.

(Prop. H, 5-1-07, eff. 5-22-07)

A. There is established a permanent special fund entitled the "Police and Fire Public Safety Oil Production Act fund" (hereinafter the "safety fund"). Money collected pursuant to Section 3.80.222 shall be deposited into said safety fund for public safety purposes, as described in Section 3.80.224 above. Said special fund shall be used exclusively for the purposes for which the special tax is imposed, and for no other purposes. Nothing in this Section shall prevent disbursements from this special fund to reimburse the general fund and/or other funds if, and only if, money has been advanced from those other funds to pay for the uses provided in Section 3.80.224.

B. Any money raised by the special tax levied pursuant to Section 3.80.222 above, including any interest accrued thereon, that remains unencumbered at the end of any fiscal year may only be used in succeeding fiscal years for the purposes stated in Section 3.80.224.

(Prop. H, 5-1-07, eff. 5-22-07)

Every person engaged in the business of professions in the City of Long Beach shall pay an annual business license tax to the City consisting of a flat tax of two hundred forty-four dollars and fifty-eight cents ($244.58), plus an additional tax in the amount of nineteen dollars and five cents ($19.05) for each employee of such business based on its average number of employees (based upon CPI base year 2000).

(Ord. C-7783 § 6, 2002: Ord. C-6837 § 4, 1990: Ord. C-6259 § 1 (part), 1986)

The City Auditor shall annually cause an independent financial audit to be conducted and a report to be prepared, which shall be filed with the City Council no later than January 31st of each year for the prior fiscal year, containing information regarding the amount of special tax revenue collected and expended on purposes set forth in Section 3.80.224 above, the status of any projects and programs funded by such tax revenue, and the amount of unspent moneys on deposit that were carried-over into the current fiscal year.

(Prop. H, 5-1-07, eff. 5-22-07)

Every person engaged in the business of recreation and entertainment in the City of Long Beach shall pay an annual business license tax to the City consisting of a flat tax of two hundred forty-four dollars and fifty-eight cents ($244.58), plus an additional tax in the amount of twelve dollars and seventy cents ($12.70) for each employee of such business based on its average number of employees (based upon CPI base year 2000).

(Ord. C-7783 § 7, 2002: Ord. C-6837 § 5, 1990: Ord. C-6259 § 1 (part), 1986)

A. Every person engaged in the business of the rental of residential property consisting of any residential unit that is one (1) of four (4) or more such units, inclusive of owner occupied units or rooms, under one (1) roof or on one (1) parcel, shall pay an annual business tax to the City consisting of fifty-two dollars and eighty-five cents ($52.85) for each parcel containing such units and an additional twenty-three dollars and twenty cents ($23.20) for each unit thereon. This Section shall not apply to the rental of any residential unit or room that is one (1) of three (3) or less such units or rooms, inclusive of owner occupied units under one (1) roof or on one (1) parcel (based upon CPI base year 2000).

B. In residential property of seven (7) or less units subject to taxation under Subsection A of this Section, the per unit charge of twenty-three dollars and twenty cents ($23.20) for one (1) owner occupied unit may be excluded from calculating the total tax due under this Section.

(Ord. C-7783 § 8, 2002: Ord. C-7067 § 1, 1993; Ord. C-6986 § 2, 1992: Ord. C-6901 § 1, 1991: Ord. C-6837 § 6, 1990: Ord. C-6325 § 3, 1986: Ord. C-6259 § 1 (part), 1986)

Every person engaged in the business of rental of nonresidential property shall pay an annual business license tax to the City consisting of two and seven-tenths (2 7/10 ) cents for each square foot of rental space (based upon CPI base year 2000).

(Ord. C-7783 § 9, 2002: Ord. C-6837 § 7, 1990: Ord. C-6259 § 1 (part), 1986)

Every person engaged in the business of retailing in the City shall pay an annual business license tax to the City consisting of a flat tax of two hundred forty-four dollars and fifty-eight cents ($244.58), plus an additional tax in the amount of six dollars and thirty-five cents ($6.35) for each employee of such business based on its average number of employees (based upon CPI base year 2000).

(Ord. C-7783 § 10, 2002: Ord. C-6837 § 8, 1990: Ord. C-6259 § 1 (part), 1986)

A. Every person engaged in the business of services in the City shall pay an annual business license tax to the City consisting of a flat tax of two hundred forty-four dollars and fifty-eight cents ($244.58), plus an additional tax in the amount of twelve dollars and seventy cents ($12.70) for each employee of such business based on its average number of employees (based upon CPI base year 2000).

B. Every independent contractor engaged in the business of services which are secondary to another service business located at the same address shall pay an annual business license tax to the City consisting of a flat tax of one hundred fifty dollars ($150.00), plus an additional tax in the amount of twelve dollars and seventy cents ($12.70) for each employee of such business based on its average number of employees (based upon CPI base year 2000). The independent contractor's business shall be customarily incidental and/or necessarily related to the principal business in order to be eligible for this lesser tax rate.

(Ord. C-7783 § 11, 2002: Ord. C-6837 § 9, 1990: Ord. C-6259 § 1 (part), 1986)

Every person engaged in the business of vending operations shall pay an annual business tax to the City consisting of four dollars and ninety-three cents ($4.93) for each one thousand dollars ($1,000.00) or part thereof of gross receipts, but in no event less than one hundred four dollars and forty cents ($104.40).

(Ord. C-6837 § 10, 1990: Ord. C-6259 § 1 (part), 1986)

Every person engaged in the business of wholesaling in the City shall pay an annual business license tax to the City consisting of a flat tax of two hundred forty-four dollars and fifty-eight cents ($244.58), plus an additional tax in the amount of six dollars and thirty-five cents ($6.35) for each employee of such business based on its average number of employees (based upon CPI base year 2000).

(Ord. C-7783 § 12, 2002: Ord. C-6837 § 11, 1990: Ord. C-6259 § 1 (part), 1986)

Every person engaged in one (1) or more of the individual businesses set forth in this Section shall pay a business license tax to the City as is herein provided.

A. Ambulance, wheelchair van, gurney van - ninety dollars and fifty-eight cents ($90.58) for each vehicle annually (based upon CPI base year 2000);

B. Amusement skill game - four hundred seven dollars and sixty-six cents ($407.66) for each machine or seat annually (based upon CPI base year 2000);

C. Billiards, pool, bowling, and ping pong - ninety dollars and fifty-eight cents ($90.58) for each game, device, lane, or table annually (based upon CPI base year 2000);

D. Booth selling - as defined in Subsection 3.80.180.D, the sum of thirty-six dollars and twenty-one cents ($36.21) each day for each booth (based upon CPI base year 2000);

E. Consignment business - fifty-six dollars and nineteen cents ($56.19) for each location where merchandise is placed for sale, except that the tax shall not apply to any person selling only three (3) or less items in a consecutive twelve (12) month period (based upon CPI base year 2000);

F. Display/selling booth space in connection with display or selling event as defined in Subsection 3.80.180.F - one dollar and eighty-one cents ($1.81) each day for each booth. The licensee shall provide the director of financial management with a listing of vendors who display, sell, offer for sale or exchange, or provide a personal service at a display/selling event. The report shall be filed and fees paid to the Director no later than three (3) working days after the close of the event (based upon CPI base year 2000);

G. Farmer's market - fifty-four dollars and thirty-four cents ($54.34) for each booth/stall/vendor annually (based upon CPI base year 2000);

H. Food products - mobile - three hundred eight dollars and one cent ($308.01) for each mobile food unit annually (based upon CPI base year 2000);

I. Home occupation - one hundred fifty dollars ($150.00) and six dollars and thirty-five cents ($6.35) for each employee permitted by Section 21.51.235 annually (based upon CPI base year 2000);

J. Junk collector - one hundred sixty-three dollars and seven cents ($163.07) for each vehicle annually (based upon CPI base year 2000);

K. Motion picture or live theater - fifty-five cents ($0.55) for each seat in such theater annually (based upon CPI base year 2000);

L. Peddling - nine hundred five dollars and eighty cents ($905.80) annually or ninety dollars and fifty-eight cents ($90.58) each day (based upon CPI base year 2000);

M. Pedicab - one hundred sixty-three dollars and seven cents ($163.07) for the first pedicab and fourteen dollars and sixty-three cents ($14.63) for each additional pedicab annually (based upon CPI base year 2000);

N. Shoeshine stand - ninety dollars and fifty-eight cents ($90.58) for each stand annually (based upon CPI base year 2000);

O. Sidewalk vendor - three hundred dollars ($300.00) for each conveyance (i.e., pushcart, stand, display, pedal-driven cart, wagon, showcase, rack, or other nonmotorized conveyance) or, if no conveyance is used, each person, annually (based upon CPI base year 2024);

P. Swap meet - two thousand seven hundred seventeen dollars and seventy-five cents ($2,717.75) annually and one dollar and eighty-one cents ($1.81) for each stall for each day of a sales meet (based upon CPI base year 2000);

Q. Trucking delivery/service by vehicle - one hundred sixty-three dollars and seven cents ($163.07) for each vehicle annually (based upon CPI base year 2000);

R. Vehicle for hire with driver (limousines, share ride, jitney, taxi) - three hundred forty-four dollars and twenty-seven cents ($344.27) for each vehicle annually (based upon CPI base year 2000);

S. Vehicles for hire without driver - ninety dollars and fifty-eight cents ($90.58) for each vehicle annually (based upon CPI base year 2000); and

T. Bed and breakfast establishment - two hundred forty-four dollars and fifty-eight cents ($244.58) for each establishment annually plus twelve dollars and seventy cents ($12.70) for each employee of such establishment based on its average number of employees (based upon CPI base year 2000).

(ORD-24-0002 § 4, 2024; Ord. C-7783 § 13, 2002: Ord. C-7438 § 3, 1996: Ord. C-7263 § 2, 1994: Ord. C-6837 § 12, 1990: Ord. C-6627 § 3, 1989; Ord. C-6325 § 4, 1986: Ord. C-6259 § 1 (part), 1986)

For purposes of apportionment as may be required by law and for purposes of administration and enforcement of this Chapter, the Director may from time to time promulgate administrative rules and regulations for a business subject to the business license tax under this Chapter that can demonstrate to the satisfaction of the Director that it will be doing business in the City for only a portion of a year.

(Ord. C-7783 § 14, 2002: Ord. C-6259 § 1 (part), 1986)

Editor's note— Measure MA § 1, adopted Nov. 8, 2016, repealed § 3.80.260 entitled "Marijuana Businesses", which derived from: Measure B, adopted Nov. 2, 2010, eff. Dec. 17, 2010; and Measure MM § 1, adopted Nov. 8, 2016. See § 3.80.261 for similar provisions.

A. Definitions. For purposes of this Section, the following terms shall be defined as follows:

1. "Equity Business" means a cannabis business where a minimum of fifty-one percent (51%) ownership in the cannabis business is held by one equity applicant or, if the cannabis business will be held by a group of applicants in the Equity Program, any one (1) of the equity applicants must hold majority ownership interest in the cannabis business.

2. "Gross Receipts" shall mean any transfer of title or possession, exchange or barter, conditional or otherwise, in any manner or by any means whatsoever, of tangible personal property for a consideration including any monetary consideration for marijuana whatsoever, including, but not limited to, membership dues, reimbursements or the total amount of cash or in-kind contributions, including all operating costs related to the growth, cultivation, processing, storage, delivery or provision of marijuana or any transaction related thereto. The term "Gross Receipts" shall also include the total amount of the sale price of all sales, the total amount charged or received for the performance of any act, service or employment of whatever nature it may be, whether or not such service, act or employment is done as a part of or in connection with the sale of goods, wares, merchandise, for which a charge is made or credit allowed, including all refunds, cash credits and properties of any amount or nature, any amount for which credit is allowed by the seller to the purchaser without any deduction therefrom, on account of the cost of the property sold, the cost of materials used, the labor or service cost, interest paid or payable, losses, or any other expense whatsoever; provided that cash discounts allowed or payment on sales shall not be included. "Gross Receipts" shall not include the amount of any federal tax imposed on or with respect to retail sales whether imposed upon the retailer or the consumer and regardless of whether or not the amount of federal tax is stated to customers as a separate charge, or any California state, city or city and county sales or use tax required by law to be included in or added to the purchase price and collected from the consumer or purchaser, or such part of the sales price of any property previously sold and returned by the purchaser to the seller which is refunded by the seller by way of cash or credit allowances given or taken as part payment on any property so accepted for resale. "Gross Receipts" shall be calculated without any deduction on account of any of the following:

a. The cost of tangible property sold or bartered;

b. The cost of materials or products used, labor or service cost, interest paid, losses, or other expense; or

c. The cost of transportation of the marijuana, or other property or product.

3. "Income Tax Exempt Non-Profit Organization" shall mean any association, corporation or other entity that is exempt from taxation measured by income or gross receipts under Article XIII, Section 26 of the California Constitution.

4. "Marijuana" shall mean all parts of the plant Cannabis sativa Linnaeus, Cannabis indica, or Cannabis ruderalis, whether growing or not; the seeds thereof; the resin; whether crude or purified, extracted from any part of the plant; and every compound, manufacture, salt, derivative, mixture, or preparation of the plant, its seeds, or resin. "Marijuana" also means the separated resin, whether crude or purified, obtained from marijuana. "Marijuana" also means the term as defined in California Health and Safety Code Section 11018 and is not limited to medical marijuana.

5. "Marijuana Business" shall mean any business, whether operating for-profit or not-for-profit, which performs any of the following activities: marijuana cultivation, delivering, distribution, processing, transporting, dispensing, selling at retail or wholesale, manufacturing, compounding, converting, preparing, storing, packaging, or testing. "Marijuana Business" includes both a Medical Marijuana Business and Non-Medical Marijuana Business. "Marijuana Business" does not include personal medical marijuana cultivation that is specifically permitted by state law or the Long Beach Municipal Code.

6. "Marijuana Cultivation" shall mean the seeding, planting, watering, warming, cooling, growing, cultivating, harvesting, drying, curing, grading or trimming of marijuana.

7. "Marijuana Delivery" shall mean the commercial transfer of marijuana or marijuana products from a marijuana business to a retail or wholesale customer.

8. "Marijuana Distribution" or "Marijuana Transport" shall mean any activity involving the commercial procurement, sale, transfer and/or transport of marijuana and marijuana products from one Marijuana Business to another Marijuana Business for purposes authorized pursuant to state law or the Long Beach Municipal Code.

9. "Marijuana Processing" shall mean any activity involving the manufacturing, production, preparation, propagation, processing, converting, or compounding of raw marijuana or marijuana products either directly or indirectly or by extraction methods, or independently by means of chemical synthesis at a fixed location that packages or repackages marijuana or marijuana products or labels, packages or relabels its container.

10. "Marijuana Product" shall mean marijuana that has undergone a process whereby the raw agricultural product has been transformed into a concentrate, an edible product, or a topical product. "Marijuana Product" also means marijuana products as defined by California Health and Safety Code Section 11018.1 and is not limited to medical marijuana products.

11. "Marijuana Retail Sale" shall mean any activity involving the retail sale to customers of marijuana, marijuana products, or devices for the use of marijuana or marijuana products, either individually or in any combination, including marijuana delivery as part of a retail sale.

12. "Marijuana Testing" means any activity involving the testing of marijuana or marijuana products by a facility that is both of the following:

a. Accredited by an accrediting body that is independent from all other persons involved in the marijuana industry in the state; and

b. Registered with the California State Department of Public Health.

13. "Medical Marijuana Business" shall mean any Marijuana Business which performs marijuana cultivation, delivering, distribution, processing, transporting, dispensing, selling at retail or wholesale, manufacturing, compounding, converting, preparing, storing, packaging, or testing, for the ultimate consumption or use of marijuana by qualified patients in accordance with California Health and Safety Code Sections 11362.5 et seq., the California Medical Marijuana Regulation and Safety Act ("MMRSA"), and any other State law authorizing activities related to the medical use of marijuana.

14. "Non-Medical Marijuana Business" shall mean any business which performs marijuana cultivation, delivering, distribution, processing, transporting, dispensing, selling at retail or wholesale, manufacturing, compounding, converting, preparing, storing, packaging, or testing, for any other purpose than as a Medical Marijuana Business.

15. "Personal Medical Marijuana Cultivation" means cultivation by a qualified patient who cultivates one hundred (100) square feet total canopy area or less of marijuana exclusively for his or her personal medical use but who does not provide, donate, sell, or distribute marijuana to any other person. "Personal Medical Marijuana Cultivation" also includes cultivation by a primary caregiver who cultivates one hundred (100) square feet total canopy area or less of marijuana exclusively for the personal medical purposes of no more than five (5) specified qualified patients for whom he or she is the primary caregiver, but who does not receive remuneration for these activities except for compensation in full compliance with California Health and Safety Code Section 11362.765(c), as it may be amended.

16. "Square Foot under Cultivation" or "Square Footage under Cultivation" shall mean the actual amount of canopy (measured by the aggregate area of vegetative growth of live marijuana plants on the premises including the area occupied by vertically and horizontally stacked canopies) that is limited by the maximum amount a marijuana business is authorized to cultivate by either a City permit or license, or by a state license in the absence of a City permit or license, not deducting for unutilized square footage.

B. Business License Tax.

1. Every Marijuana Business whether organized as not-for-profit or for-profit, shall pay a business license tax in accordance with Chapter 3.80 of this Code and this Section.

2. For the purposes of this Section, a Marijuana Business is considered to be a business as that term is defined in Long Beach Municipal Code Section 3.80.133.

3. For the purposes of this Section, a Marijuana Business is not considered to be a religious or charitable organization as defined in Long Beach Municipal Code Section 3.80.320 (Exemption - Religious and charitable organizations).

4. The business tax set forth in this section is a general tax, the revenues from which shall be deposited into the City's general fund and may be expended for any valid public purpose of the City.

C. Business License Tax Rates.

1. Every medical marijuana business engaged in marijuana retail sale or delivery within the City shall pay a business tax at a rate of up to eight percent (8%) of gross receipts, except equity businesses who meet the eligibility criteria as stated in Section 5.92.1615, shall pay a business tax at half the rate set for non-equity businesses. The tax shall be initially set at a rate of six percent (6%). The tax under this paragraph shall not be increased on medical marijuana businesses unless and until the City Council by ordinance takes action, and the tax rate shall not exceed eight percent (8%) of gross receipts.

2. Every non-medical marijuana business engaged in marijuana retail sale or delivery within the City shall pay a business tax at a rate of up to twelve percent (12%) of gross receipts, except equity businesses who meet the eligibility criteria as stated in Section 5.92.1615, shall pay a business tax at half the rate set for non-equity businesses. The tax which was initially set at a rate of eight percent (8%) is reduced and set at a rate of seven percent (7%). The tax under this paragraph shall not be increased on non-medical marijuana businesses unless and until the City Council by ordinance takes action, and the tax rate shall not exceed twelve percent (12%) of gross receipts.

3. If a marijuana business is engaged in retail sales or delivery of both medical marijuana and a non-medical marijuana, it shall pay the business tax set forth in paragraph C.2., unless the marijuana business identifies to the City, by reasonable and verifiable standards, the portions of its retail sales activities that are tied to medical marijuana and those that are tied to non-medical marijuana, through the marijuana business' books and records kept in the regular course of business, and in accordance with generally accepted accounting principles, and not specifically created and maintained for tax purposes. The marijuana business has the burden of proving the proper apportionment of taxes under this paragraph C.3.

4. Every marijuana business, whether medical or non-medical, that is engaged in marijuana distribution, transport, processing, or testing within the City, shall pay business tax at a rate of up to eight percent (8%) of gross receipts. The tax which was initially set at a rate of six percent (6%), is reduced and set at a rate of one percent (1%). The tax under this section shall not be increased on marijuana businesses unless and until the City Council by ordinance takes action, and the tax rate shall not exceed eight percent (8%) of gross receipts. If a marijuana business that is engaged in marijuana distribution, transport, processing, or testing, is also engaged in marijuana retail sale or delivery of the same marijuana and marijuana products, then it shall pay the business taxes set forth in paragraphs C.1. or C.2., as applicable, for retail sale or delivery of any marijuana or marijuana products and is not required to pay the business taxes set forth in this paragraph for marijuana distribution, transport, processing, or testing for the same marijuana and marijuana products. The marijuana business has the burden of proving that the marijuana or marijuana products involved in distribution, transport, processing, or testing are the same.

5. In addition to the taxes set forth in paragraphs C.1., C.2., and C.4., every marijuana business, whether medical or non-medical, engaged in marijuana cultivation shall pay a tax of up to fifteen dollars ($15.00) per square foot under cultivation, except equity businesses who meet the eligibility criteria as stated in Section 5.92.1615, shall pay a business tax at half the rate set for non-equity businesses. The tax which was initially set at a rate of twelve dollars ($12.00) per square foot under cultivation and increased to fourteen dollars and ninety-six cents ($14.96) per annual adjustment as stipulated in paragraph E., is set to thirteen dollars and nine cents ($13.09). The City Council may by ordinance increase any such tax rate from time to time, not to exceed the maximum tax rate of fifteen dollars ($15.00) per square foot under cultivation.

6. Notwithstanding the maximum tax rates imposed in paragraphs C.1., C.2., C.4. and C.5., the City Council may in its discretion at any time by ordinance implement a lower tax rate, as defined in such ordinance, subject to the maximum rates set forth in C.1., C.2., C.4. and C.5. City Council may subsequently in its discretion, at any time by ordinance, implement a higher tax rate, subject to the maximum rates set forth in C.1., C.2., C.4. and C.5., and such increase does not constitute a tax increase for which voter approval is required Article XIII C of the California Constitution.

7. All marijuana businesses shall pay a minimum tax of one thousand dollars ($1,000.00) annually.

D. Modification, Repeal or Amendment. The City Council may repeal the ordinance codified in this Section, or amend it in a manner which does not result in an increase in the tax or taxes imposed herein, without further voter approval. If the City Council repeals said ordinance or any provision of this Section, it may subsequently reenact it without voter approval, as long as the reenacted ordinance or Section does not result in an increase in the tax or taxes beyond the maximum rate or methodology imposed herein.

E. Annual Adjustment. The taxes imposed by paragraph C.5 shall be adjusted annually by the Director of Financial Management. Beginning on October 1, 2018, and on October 1 of each succeeding year thereafter, the amount of each tax imposed by paragraph C.5 shall be adjusted equivalent to the most recent change in the annual average of the Consumer Price Index ("CPI") for all urban consumers in the Los Angeles-Riverside-Orange County areas as published by the United States Government Bureau of Labor Statistics; however no adjustment shall decrease any tax imposed by paragraph C.5. For the purposes of calculating the annual adjustment factor under paragraph C.5, the base year shall be that year ending with December 31, 2016. Rates shall next be adjusted on October 1, 2018, and annually thereafter, based on the annually calculated change from the base year. The October 1, 2018, adjustment shall be the change in the average CPI for the year ending December 31, 2017, compared to the base year ending December 31, 2016.

F. Pilot Tax Program. Every medical and non-medical marijuana business engaged in cultivation and non-medical marijuana business engaged in retail sale or delivery, is eligible to apply for the Pilot Tax Credit Program to receive a tax credit of 3% upon, meeting the good standing requirements and eligibility criteria set by City Council. Under no circumstances may a tax credit result in tax at a rate less than two percent (2%).

G. Administration. The City Manager, or designee, and/or the City Council by ordinance, may promulgate regulations to implement and administer this Section including, but not limited to regulations allowing Marijuana Businesses to report and or remit taxes more or less frequently than monthly. The City Manager shall provide no less than annually a report to the City Council detailing annual expenditures.

H. Reporting and Remittance. In order to aid in the City's collection of taxes due under this Section and to ensure that all Marijuana Businesses are taxed consistently to the best of the City's ability, beginning as set forth in Section M, below, and monthly thereafter, each Marijuana Business shall report to the City any Gross Receipts received during the reporting period and shall likewise remit to the City the taxes due and owing during said period. For purposes of this Section, taxes shall begin to accrue on the date that a person or entity first receives a business license or other permit to operate as a Marijuana Business or Cultivation Site. Square Footage payments shall be made annually at the beginning of the calendar year and should be based on the square footage that the marijuana business is authorized to cultivate by either a City permit or license, or by a state license in the absence of a City permit or license, not deducting for unutilized square footage, pro-rated based on the number of months of operation.

I. Delinquent date—Penalties. Any individual or entity who fails to pay the taxes required by this Section within thirty (30) days after the due date shall pay in addition to the taxes a penalty for nonpayment in a sum equal to twenty-five percent (25%) of the total amount due. Additional penalties will be assessed in the following manner: ten percent (10%) shall be added on the first day of each calendar month following the month of the imposition of the twenty-five percent (25%) penalty if the tax remains unpaid; up to a maximum of one hundred percent (100%) of the tax payable on the due date. Receipt of the tax payment in the office shall govern the determination of whether the tax is delinquent. Postmarks will not be accepted as adequate proof of a timely payment.

J. Records Inspection. Whenever it is necessary to examine any books or records, including tax returns, of any Marijuana Business or Cultivation Site in the City to ascertain the amount of any tax due pursuant to this Section, the City shall have the power and authority to examine such necessary books and records at any reasonable time including, but not limited to, during normal business hours. Records must be maintained for no less than seven (7) years.

K. Suspension, Revocation and Appeal. The provisions of Sections 3.80.429.1 (Suspension or Revocation) and 3.80.429.5 (Appeal of License Revocation) shall apply in the case of Marijuana Businesses or Cultivation Sites governed by this Section.

L. Application of Provisions. No business license permit issued under the provisions of this Code, or the payment of any tax required under the provisions of this Code shall be construed as authorizing the conduct or continuance of any illegal business or of a legal business in an illegal manner. Nothing in this Section implies or authorizes that any activity connected with the distribution or possession of cannabis is legal unless otherwise authorized and allowed by California and federal law. Nothing in this Section shall be applied or construed as authorizing the sale of marijuana.

M. Operative Date. This ordinance establishing a marijuana business tax shall only become operative: 1) if Chapter 5.89 of the Long Beach Municipal Code (banning marijuana businesses in the City of Long Beach) is repealed; and 2) if a regulatory scheme to permit marijuana businesses within the City is adopted. The tax shall become effective on the effective date of the regulatory ordinance as provided by law.

(ORD-24-0009 § 1, 2024; ORD-23-0032 §§ 1, 2, 2023; ORD-20-0001 § 1, 2020; Measure MA § 2, 11-8-2016; Measure MM § 2, 11-6-2016; Measure A, 4-8-2014, eff. 5-23-2014)