After an initial discussion of allowing cannabis shops in the city, Mission Viejo City Council members ultimately rejected the idea that would’ve made it the first South Orange County city with legal cannabis sales. 

City planning commissioners recommended the move to allow the shops an increase in sales tax revenue, but council members voted 3-2 against the idea and ended discussion of the item at the May 24 meeting. Council members Trish Kelley and Brian Goodell voted in favor of having a discussion on the issue.

“[Cannabis] is an entry-level drug,” Councilmember Ed Sachs said at the meeting. “How do we as a council support the walk against drugs when we support bringing drugs into our community? That doesn’t make sense whatsoever to me.”

The planning commission had recommended the item because of the additional sales tax revenues and other fees to the city.

Elaine Lister, the director of community development for the city, said that if approved, the city would be estimated to annually generate between $250,000 and $350,000 in sales tax revenue per shop.

Mission Viejo’s 2021-2023 budget document shows that the two primary revenue sources for the city are property and sales taxes.

Sales taxes — which have been impacted by COVID-19 state restrictions limiting local businesses’ ability to operate at normal capacity — decreased by 15.1% from 2019 to 2020, in addition to a projected 7.4% decrease for 2020 to 2021. 

Because businesses began to reopen, sales taxes in the city are expected to increase by 14.7% for 2021 to 2022 and another 3.4% for 2022 to 2023, bringing the total revenue in sales tax up to approximately $17 million, according to the city’s budget document.

Lister said that a survey of Mission Viejo residents showed that 35% of residents polled supported recreational use of cannabis in the city and 54% did not. Additionally, 53% of surveyed residents supported medicinal use of cannabis, while 38% did not.

Residents in support of the shops pointed to millions of dollars in taxes that the city could gain from allowing the businesses in the city and many local residents who use cannabis for medical usage that are forced to travel to Santa Ana to get their medications.

Other speakers voiced concerns regarding Mission Viejo values and negative effects on families in the area.

Councilmember Trish Kelley also spoke against the potential increased exposure of cannabis to local youth if dispensaries are allowed on city property.

“Even though it would be illegal to sell to minors, it is going to make it more available [to kids],” Kelley said.

The discussion comes after a high-level Democratic political consultant allegedly tried bribing Irvine City Council members for favorable cannabis legislation, according to an FBI affidavit.

Melahat Rafiei — who advised OC people like Irvine Mayor Farrah Khan as well as cannabis businesses — publicly confirmed her involvement in the FBI corruption investigation into Anaheim City Hall and former Mayor Harry Sidhu.

[Read: Key Witness for FBI Anaheim Probe Disputes Feds’ Account That She Was Arrested Before Cooperating]

The affidavit from FBI agent Brian Adkins states she was arrested, but Raifei disputes that allegation and says she was detained instead.

The FBI alleges that their investigation found that Raifei had planned to solicit money from a pair of cannabis business clients to pay bribes to two Irvine City Council members in exchange for the Council Members performing acts to pass favorable laws for their cannabis company. The cannabis clients were secretly working for the FBI, according to the FBI affidavit.

Raifei disputes the bribery allegations.


Meanwhile, other discussions regarding Mission Viejo’s updated economic development strategy included raising the city’s hotel bed taxes, also known as transit occupancy taxes, although the decision will ultimately be up to the residents.

The city currently has an 8% hotel bed tax for people staying in hotels in the city. Surrounding south OC cities — including Lake Forest, Laguna Hills and Aliso Viejo — all require a 10% tax.

The council voted 4-1 to place raising the tax on a future ballot for a city vote.

Councilmember Greg Raths voted against the item because of a previous promise to never vote to increase taxes in the city, he said.

The vote also included city efforts to create a business registration to improve city communication with local businesses and a requirement for the council to review the city’s economic development element every five years.

Angelina Hicks is a Voice of OC Reporting Fellow. Contact her at or on Twitter @angelinahicks13.

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