Santa Cruz County Prepares for Legal Pot

As we noted previously, Santa Cruz County could be first in line when commercial marijuana sales are legalized in just a couple of weeks. The county already has the second highest density of dispensaries per capita in the state and the city’s three existing shops say they expect to be ready and legally able to sell recreational pot by Jan. 1. The county’s 12 dispensaries also believe they’ll be approved in time.

A recent county staff report says Santa Cruz could end up growing 13 percent (1,743,000) pounds of the state’s weed after commercial cannabis becomes legal.

So all is well, right?

Not so fast. Santa Cruz’s weed industry still has reservations.

“Santa Cruz has been quite progressive, but at the same time, for all of the hundreds of brands that we carry, they might be in for a rude awakening,” says Khalil Moutawakkil, director of KindPeoples Collective. That’s because permits, taxes, and licensing fees might push people into the black market. Changes had to be implemented when Washington and Colorado legalized adult-use to prevent just that.

In the City of Santa Cruz, some modifications may already afoot.

Mayor David Terrazas says that the Council will revisit tax rates in the first quarter of 2018. It’s also allowing a couple of more dispensaries than originally planned. Applications are due tomorrow, Dec. 14.

There was an effort to lower the county’s cannabis business tax last month, but it failed to muster enough votes. It’s the state’s 15 percent excise tax that will be a problem, said District 2 County Supervisor Zach Friend, who voted against the decrease. The county tax, he argued, is reasonable and reflects the will of Santa Cruz voters.

One of the local medical marijuana businesses has since rescinded its compassion program, whereby it offered free or discounted marijuana to terminally ill patients. It’s citing increased costs ahead. Industry insiders expect to see more of that.

Read more about how the marijuana industry and officials are preparing for recreational sales in Santa Cruz here


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