Commercial Cannabis Inspection and Financial Audit Services

NOTICE IS HEREBY GIVEN that the City of Modesto, County of Stanislaus, State of California (“City”), will receive proposals (each, a "Proposal") through its OpenGov Procurement portal from qualified Proposers (each, a “Proposer”) for the furnishing of Commercial Cannabis Inspection and Financial Audit Services services (the “Services”) for the City of Modesto, Finance Department, Purchasing Division.

The City of Modesto is the county seat and largest City in Stanislaus County with a population of approximately 219,989 persons. The City encompasses a total incorporated area of 37.8 square miles and a total General Plan area of 66.7 square miles and is located on State Route 99, which links it to other Central Valley cities, including Sacramento (82 miles north), Stockton (32 miles north), and Fresno (96 miles south). Rail service links Modesto to the greater region. Passenger service is available outside of Downtown Modesto at the Burlington Northern/Santa Fe Railroad’s (Amtrak) Lakewood East Station, in eastern Modesto.

The passage of Proposition 64, The Adult Use of Marijuana Act, in November 2016 ended the prohibition on adult-use of cannabis in California and created a statewide regulatory structure for adult-use cannabis businesses similar to that previously approved for medicinal cannabis businesses. Proposition 64 gave local governments control of taxes and fees associated with cannabis businesses operating within their jurisdictions.

On January 16, 2018, the Modesto City Council adopted Ordinance No. 3684-C.S. which permitted certain commercial cannabis uses, subject to land use and zoning criteria. These regulations permit cannabis retailers within City limits, but do not allow any in the downtown area. The Ordinance further established that wholesale cannabis businesses, such as testing, nurseries, microbusinesses, manufacturing, distribution, and cultivation (indoor) are permitted.

The City of Modesto current Cannabis Business Tax rates range from 1% to 8% of all gross receipts for cannabis businesses. The rates are listed below by type of cannabis business.

• Retail - 8%
• Distribution - 2.5%
• Microbusiness (Retail) - 8%
• Microbusiness (Manufacturing - Wholesale) - 4%
• Microbusiness (Cultivation - Wholesale) - 2.5%
• Manufacturing - 4%
• Cultivation (Nursery) - 1%
• Cultivation (Indoor only) 2.5%
• Testing Labs - 1.5%