Grover Beach has paved the way for the marijuana industry in San Luis Obispo County.
The first storefront dispensary opened back in May and a second store opened in July. A marijuana manufacturing business is also up and running.
805 Beach Breaks was the first shop to open its doors in Grover Beach. When it comes to the tax revenue it’s generated so far, all that money goes back into the community and it could benefit all of us.
“Our average transaction is about $99 per customer and so we’re looking about 25 to almost 30 percent in tax rate with the city, the state,” said Daniel Fried, General Manager of 805 Beach Breaks.
The city requires businesses like 805 Beach Breaks to pay a 5 percent gross receipts tax. Manufacturers pay 3 percent.
“I’m giving kudos to the City of Grover Beach for doing a 5 percent tax rate versus the maximum of 10 percent on the goods and drive more sales,” Fried said.
“In the first quarter we generated $120,000 and that was with three businesses,” said Grover Beach City Manager Matt Bronson.
The city was able to add this cash from July 1 to September 30 into its general fund.
“We are pleased that we’re beginning to generate tax revenues that will come right back to the community and help support key services,” Bronson said.
He says the money can be used for streets, street lights, sidewalks, parks, police and fire, or other community needs.
“Customers do need some education on why the price of the goods go up at the end of their transaction and for us, it’s really about being able to quote that it’s going back to the community,” Fried said.
And even more cash will be coming in for the fiscal year from July 1 to June 30 of next year.
“We estimated approximately $700,000 would be generated in cannabis tax revenues and we believe we are on track for meeting that projection in this year’s budget,” Bronson added.
This number includes two more retailers expected to set up shop early next year among more manufacturers and some cultivators.
During a meeting in February, the city council will decide what specific projects the tax revenue will go toward.
In California, tax revenue from the cannabis industry totaled over $74 million from April 1 through June 30, according to the California Department of Tax and Fee Administration.