LEGISLATIVE FISCAL OFFICE
Fiscal Note
Fiscal Note On: HB 440 HLS 21RS 967
Bill Text Version: ENGROSSED
Opp. Chamb. Action:
Proposed Amd.:
Sub. Bill For.:
Date: May 9, 2021 3:15 PM Author: NELSON
Dept./Agy.: Health and Revenue, Alcohol and Tobacco Control
Subject: Cannabis Licenses Fees and Permit Fees Analyst: Patrice Thomas
FEES/LICENSES/PERMITS EG INCREASE SG RV See Note Page 1 of 1
Levies fees for licenses and permits relative to cannabis
Proposed law levies an annual fee of $2,500 for a nonrefundable cannabis business license and nonrefundable annual fee of
$100 for a personal cultivation permit. Both annual fees will be collected by the Commissioner of Alcohol and Tobacco
Control (ATC). Proposed law provides that if fees collected pursuant to proposed law in a fiscal year exceed the costs of
enforcement and regulation, then the excess fees shall be distributed proportionally to certain municipalities, sheriffs,
parishes, and the state. Proposed law provides that the Commissioner of Alcohol and Tobacco Control (ATC), after an
adjudicatory hearing, may levy upon any person who violates the proposed law subjected to a civil penalty of up to $50,000
for each violation and each day of violation. Proposed law will become effective if and when House Bill 699 of 2021 Regular
Session is enacted and becomes effective.
EXPENDITURES 2021-22 2022-23 2023-24 2024-25 2025-26 5 -YEAR TOTAL
State Gen. Fd. $0 $0 $0 $0 $0 $0
Agy. Self-Gen. INCREASE INCREASE INCREASE INCREASE INCREASE
Ded./Other $0 $0 $0 $0 $0 $0
Federal Funds $0 $0 $0 $0 $0 $0
Local Funds SEE BELOW SEE BELOW SEE BELOW SEE BELOW SEE BELOW
Annual Total
REVENUES 2021-22 2022-23 2023-24 2024-25 2025-26 5 -YEAR TOTAL
State Gen. Fd. $0 $0 $0 $0 $0 $0
Agy. Self-Gen. INCREASE INCREASE INCREASE INCREASE INCREASE
Ded./Other $0 $0 $0 $0 $0 $0
Federal Funds $0 $0 $0 $0 $0 $0
Local Funds INCREASE INCREASE INCREASE INCREASE INCREASE
Annual Total
EXPENDITURE EXPLANATION
The Office of Alcohol and Tobacco Control (ATC) within the LA Department of Revenue will be required to issue certain
permits related to cannabis business licenses and cannabis personal cultivation permits. Proposed law provides that permit
collections exceeding the costs of enforcement (not addressed in this measure) and regulation shall be distributed to certain
local entities and the state in the same proportion as distributions of tax collections for that Fiscal Year. Total expenditures
are speculative and unknown.
REVENUE EXPLANATION
Proposed law will increase revenue collections by an indeterminable amount in the Office of Alcohol and Tobacco Control
(ATC) within the LA Department of Revenue as a result of issuing cannabis personal cultivation permits. Also, if the amount
of fees collected under the proposed law exceed the cost of enforcement and regulation in ATC in a fiscal year, the excess
fees shall be distributed proportionally to certain municipalities, sheriffs, and parishes.
The proposed law authorizes ATC to levy an annual fee for a personal cultivation permit of $100. The LFO cannot determine
the number of personal cultivation permits will be issued under this measure or anticipate the amount of revenue collected
by the Office of Public Health.
The proposed law provides for civil penalties of up to $50,000 per violation per day assessed by the Commissioner of ATC
after an adjudicatory hearing. The number of individuals that may be assessed penalties is speculative and indeterminable.
The LFO presumes the potential revenue will accrue to the SGF due to the required ruling by the Commissioner, but this
point is unclear as civil penalties generally accrue to local governing authorities.
Proposed law is a companion bill to HB 699 (substitute for HB 524) that decriminalizes marijuana and regulates its
recreational purposes.
Senate Dual Referral Rules House
13.5.1 >= $100,000 Annual Fiscal Cost {S & H} 6.8(F)(1) >= $100,000 SGF Fiscal Cost {H & S}
Alan M. Boxberger
13.5.2 >= $500,000 Annual Tax or Fee 6.8(G) >= $500,000 Tax or Fee Increase
Change {S & H} Staff Director
or a Net Fee Decrease {S}