Marijuana tax dollars boost local economies, but they likely won’t solve every budget shortfall.
An expert who helped write Denver’s marijuana regulations says cannabis taxes account for three percent of that city’s general fund — about $43 million.
“That’s a ton of money, but it’s not what I would call game-changing amounts of money,” said Dan Rowland, a consultant who used to work at Denver’s Office of Marijuana Policy.
“It does not repair any one city or state’s fiscal issues. It doesn’t allow you to start redoing parks and redoing all of your roads and bridges. But it does fund the cost of regulation and it does fund very carefully selected special projects.”
Rowland joined a handful of cannabis experts in Chula Vista to talk about the economic benefits of legalization during a forum hosted by the South Bay Economic Development Corp. Representatives from Chula Vista, Imperial Beach and National City attended the forum to learn more about the impact of regulating a legal marijuana market.
For Chula Vista, the forum was a preview of regulations its City Council voted on Feb. 27. The ordinance called for 12 dispensaries or delivery services and had no limits on cultivation, manufacturing or distribution sites. City staff spent months traveling to Colorado and gathering public input.
“What we found out from some of the others that went before us is that some of them jumped in a little too quickly and didn’t think of all of the impacts,” said Chula Vista’s Deputy City Manager Kelley Bacon. “So we’ve really tried to learn from other places.”
Imperial Beach City Manager Andy Hall attended the forum to hear from people who have already gone through the process. The city, after months of research and gathering community input, started to write a draft of its ordinance last week.
Hall was particularly receptive to Rowland’s view that marijuana tax revenues are not an economic savior but another tool to help fund city programs.
“This isn’t going to be the panacea that solves all of the community’s problems,” he said. “It’s just another piece of the economic engine.”
Imperial Beach’s proposed regulations, which are subject to change as the City Council continues to deliberate, currently don’t allow cultivation and limit dispensaries to one along state Route 75.
National City, which has been most resistant to recreational marijuana, was at the forum to listen. Mayor Ron Morrison said they are in “the information-gathering campaign,” and criticized the economic forum for not being balanced.
“I want to see what the benefits will be, but I also want to see what the downsides will be,” he said.
Still, the mayor’s presence surprised members of the marijuana community particularly because the city has not embraced marijuana in the past.
“I was surprised to see the mayor there, as well,” said Dallin Young, executive director of the Association of Cannabis Professionals. “We hadn’t seen much of an appetite in National City, so we hadn’t pressed it there, plus they weren’t the most favorable.”
The Association of Cannabis Professionals has been lobbying cities in San Diego County to write marijuana regulations. They’ve also written regulations themselves through initiative ballots. The group filed successful initiatives in La Mesa and Lemon Grove.
On Feb. 6, the association ruffled feathers in Imperial Beach by introducing a ballot initiative just before the City Council was scheduled to have a public discussion of its own ordinance.
Councilman Ed Spriggs called the move “puzzling and disturbing” in an Op-Ed to the local website digimperialbeach.com. The City Council thought the association would hold off on an initiative if the city made a good-faith effort to write its own ordinance.
Young countered that the city’s ordinance of one dispensary along state Route 75 is too limited. The initiative, which was rejected by the city clerk because of wording issues, called for manufacturing, cultivation, and marijuana lounges on the state route and Seacoast Drive.
Ballot initiatives have sprung up throughout California, said David McPherson, a former police officer, tax administrator, and compliance auditor who now helps cities draft their own policies.
“It’s kind of spot checking all over the place and it’s the smaller cities that have limited resources to prevent that,” McPherson said.
The problem with ballot initiatives is they don’t always consider everything that the cities consider, such as land use or environmental issues. There is also concern that they are biased in favor of industry groups, he added.