History of the Program

Prior to the robust regulatory system in place today, San Jose had over 100 medical cannabis storefronts operating in the City without any regulations or oversight. In September 2013, the San Jose City Council determined that it was critical that there were rules and operational standards in place in order to effectively monitor and regulate medical cannabis establishments operating in the City. On June 17, 2014, the City Council approved a Medical Marijuana Land Use Ordinance and a Medical Marijuana Regulatory Ordinance, which make up the cannabis regulations in place today.

Beginning July 18, 2014, all collectives operating in the City had until October 17, 2014, to submit their application for registration. Only 63 of the estimated 90 Collectives operating in the City at that time had successfully submitted their application to be considered for registration by the October 17th deadline. They were then required to obtain a Zoning Code Verification Certificate by July 17, 2015, in order to proceed with an extensive review and registration process with various City departments.

By July 17, 2015, only 30 collectives received their Zoning Code Verification Certificate and proceeded with the second phase of the registration process. By the July 17th deadline, each collective was required to have submitted the building plans of their dispensing and cultivation locations for review through the Building Division; paid all of the required Marijuana Business Taxes (see below) due to the City; paid all registration processing fees; and had all of its owners, managers and individuals engaged in the cultivation, processing, manufacturing, transporting or dispensing of medical marijuana submit their application for a background investigation conducted through the San Jose Police Department.

By November 20, 2015, only 19 collectives remained in the process; each was then required to complete a site inspection of their dispensing and cultivation location. The site inspections were conducted by the Police Department along with representatives from the Code Enforcement Division and the Fire Department. By the December 18, 2015, deadline, each collective was required to have successfully passed a final inspection of its medical cannabis dispensing and cultivation locations; paid the Medical Marijuana Annual Operating Fee to the City; and obtained a Notice of Completed Registration from the City Manager to legally operate in the City.

On December 18, 2015, more than a year after the start of this registration process, only 16 Collectives obtained their Notice of Complete Registration to legally operate a Medical Cannabis Collective in San Jose.

On November 8, 2016, the voters of California approved Proposition 64, the Adult Use of Marijuana Act. Proposition 64 legalized the non-medical use of cannabis by persons aged 21 and older. Proposition 64 created a state regulatory and licensing system for the commercial cultivation, testing, distribution, and manufacture of non-medical cannabis and non-medical cannabis products.

On November 14, 2017, the San Jose City Council approved San Jose’s registered collectives to conduct non-medical (adult-use) cannabis activities in accordance with state laws effective January 1, 2018. Only those businesses listed as Registered Cannabis Businesses are authorized to cultivate, manufacture, distribute, dispense and deliver medical and non-medical cannabis in San Jose.

In addition to Zoning and Operational requirements, cannabis businesses are subject to the City’s Cannabis Business Tax, a gross receipts tax on cannabis. For business tax information, please see the City's Finance Department.

About the Division

In June of 2016, the Division of Medical Marijuana Control was created within the San Jose Police Department to effectively administer and oversee the operations of the Medical Marijuana Program. The Division was renamed the Division of Cannabis Regulation in January 2018 when the program expanded to include non-medical cannabis activities. The Division is operated directly out of the Office of the Chief of Police and consists of civilian staff. The Division works directly with staff members from various City Departments including the City Manager's Office; City Attorney's Office; Planning, Building and Code Enforcement; Fire Department; and Finance Department in a collaborative effort to effectively address the unique aspects of the medical and non-medical cannabis regulatory program. The Division works closely with each of the registered cannabis businesses to ensure the businesses understand and comply with both local and state regulations. The mission of the Division is to focus on ensuring the health and safety of the community; accommodate the needs of seriously ill medical patients; prevent the distribution of cannabis to minors; and implement strong enforcement measures to prevent criminal enterprises from operating and benefiting from any cannabis business activity in San Jose.

For more information about the Division or to report any concerns regarding a cannabis business in San Jose call the Division of Cannabis Regulation at (408)-537-1420 or email us at dcr@sanjoseca.gov.

Cannabis Fees and Charges

Review the Schedule of Fees and Charges related to the Cannabis Program for all fees and charges related to the cost of the operation of a cannabis business.

Cannabis Business Tax

On November 2, 2010, San Jose voters approved Measure U which allows the City of San Jose to tax all marijuana businesses. According to Chapter 4.66 of the San Jose Municipal Code and Ordinance No. 29262, the Marijuana Business Tax is currently set at 10% of gross receipts. Payment of the Marijuana Business Tax in no way authorizes or legalizes business activities that are otherwise unlawful in the City of San Jose.

If you have questions related to the City’s Marijuana Business Tax please, call (408) 535-7055 and press option 2 for Business Tax, then option 3 for Marijuana Business Tax Information.

• Cannabis Business Tax Return Form

Free viewers are required for some of the attached documents.
They can be downloaded by clicking on the icons below.

Acrobat Reader Windows Media Player Word Viewer Excel Viewer PowerPoint Viewer