A few weeks ago, we wrote about how the Legislature is considering increasing the share of cannabis revenues directed to cities and counties by $7.8 million. Now, under an adopted amendment, local governments would receive a percentage of overall cannabis tax revenues instead of a lump sum.

SB 5796 outlines a major overhaul of the state cannabis revenue account. Under the original bill, cities were set to share $27.8 million per year with counties—an increase from $20 million per year under current law. Now, with an adopted floor amendment, cities and counties will share 4.71% of state cannabis tax revenues once a list of other financial obligations are met. This formula is a welcome change for local governments.

Under this new formula, cities and counties would share around $23.5 million in FY20 and $27.9 million in FY21. As noted previously, cities are only eligible to receive funds if they do not prohibit the siting of any state-licensed cannabis producer, processor, or retailer. Based on the formula, cities receive a greater share if they have licensed marijuana retailers physically located within their jurisdiction.

Another change adopted in the amendment removes funding for the Community Reinvestment Account. This account would have provided tens of millions of dollars to communities disproportionately impacted by the War on Drugs. However, indications are that the Legislature may still fund this account via the supplemental budget.

Dates to remember

SB 5796 is scheduled for a public hearing in the House Appropriations Committee on February 22 at 3:30 pm.