Santa Barbara’s cannabis industry generated $6.1 million in county revenues, roughly $10 million less than projected, according to a year-end financial report presented to the Board of Supervisors on Tuesday.
When all costs to county government are factored in — permitting, planning, enforcement — that’s a net gain of $1.5 million. If the costs of law enforcement are excluded — on the grounds that illegal operations are targeted for enforcement action, not the legal ones — it’s a net gain just north of $3 million. Either way, that’s a steep drop from two years ago, when cannabis generated more than $15 million in county revenues. Given that the county finished the fiscal year with a $27 million more in its coffers than budgeted, the poor performance by cannabis was easily absorbed.
Driving the drop in cannabis revenues has been a steady decline in prices due to overall overproduction. That drop, reportedly, is starting to reverse itself. Currently, there are two cannabis dispensaries operating within the county’s jurisdiction, and two to three are expected to open up sometime in the next year.
Supervisor Das Williams, who played a major role in crafting the county’s cannabis regulatory apparatus, took this Tuesday’s presentation to lambaste the illegal cannabis market. For those who choose to buy illegally cultivated cannabis, Williams stated, “We want to be pejorative of that choice,” citing the physical and moral contamination caused by mold, pesticides, drug cartels, human traffickers, and “lots of bad stuff.”
In prior quarterly reports, the supervisors routinely heard how large numbers of cultivators failed to either report or pay their taxes. In this report, there were none. Earlier this year, the supervisors passed tough new penalties that could put delinquent operators out of business.