Founded in 1887, the town of Grover is a small, sleepy beach region within San Luis Obispo County. With a population of a little over 13,000 people, Grover Beach is a member of the 5 Cities Metropolitan Area which is actually comprised of 3 cities including Arroyo Grande, Grover Beach, and Pismo Beach (Oceano and Shell Beach are a part of Pismo).
Along with an Amtrak station, hotels, restaurants, the Monarch Grove Winery, and beautiful sandy beaches nestled against the Pacific Ocean, Grover Beach is the only city in SLO County that is talking about developing an ordinance to grow, manufacture and sell medical marijuana.
Currently there are no storefront dispensaries in Grover Beach, but Grover is the only city in SLO County in the ordinance process. In 2016, the State of California passed a law to require all cities to establish ordinances regarding marijuana sale and consumption, so now Grover is working to get something in place. There is definitely a lot of interest in opening MMJ dispensaries as more than 50 business owners have inquired about when they can get their permits.
Although the local control of marijuana use is based on state laws, in July 2016 Grover’s City Council made it a priority to discuss cannabis use and distribution to include cultivation, nurseries, manufacturing, laboratory testing, dispensaries, and other activities. Grover is the only city in SLO County that is focusing on integrating cannabis into its town on all fronts, not just implementing a dispensary or nursery based on a particular town’s agricultural, economic, or manufacturing capabilities.
However, since Grover Beach is starting from scratch in regards to cannabis use, they are focusing on getting ordinances in place for medical marijuana first and then will revisit or update the ordinance to address the recreational side.
“Grover is unique because it is the only city council (in SLO County) considering the full gamut of recreational marijuana use,” says City of Grover Beach Community Development Director Bruce Buckingham.
Expected Revenue for Bringing in Grover Beach Cannabis
A big reason to pass the ordinance is with how cannabis tax dollars will benefit the local economy. By passing Measure L-16 in last November’s election, the city has the potential to bring in between $1-$2 million of tax revenue. Here are the proposed tax rates for the various cannabis uses:
- 5% tax on gross receipts of commercial medical marijuana sales
- 10% tax on gross receipts of commercial non-medical marijuana sales (if the City adopted laws allowing marijuana recreational use)
- $25 per sq. ft. of land per 5,000 sq. ft. lot tax on cultivation centers and nurseries, with a $10 per sq. ft. fee for the remaining acreage.
In 2014, California medical marijuana tax programs generated an estimated $59-$109 million in revenues based on an 8.4% sales tax. Colorado was second in line bringing in $6 million in revenues with a 2.9% sales tax on cannabis sales.
Legalizing recreational marijuana in Colorado was a game-changer for them as the state’s Department of Revenue reported that it received around $70 million in marijuana taxes in 2015- almost double the amount brought in from alcohol sales tax. Every day the rec marijuana tax in Colorado continues to generate millions of dollars from sales that are reinvested back into the state.