The State of California’s revenue stream has diminished dramatically under the pall of the COVID-19 pandemic. This has taken the state from a projected surplus to a startling budget deficit and cutbacks. California has lost 1.4 million jobs since February 2020, and by November fully one quarter of those displaced workers gave up on seeking new employment.
So how does California recover? The first step should be employment for displaced workers, and amidst the closures of businesses across the state, the cannabis industry was deemed essential and remained open. Not only did this industry remain open, it has experienced exponential growth. In fact, the revenue stream for taxes on legal cannabis has soared more than 70% over the prior year. Of critical importance to all California citizens, during the first three financial quarters that have fallen during the COVID crisis, California received $734.1 million in cannabis tax revenue bringing the calendar year total for 2020 to $940 million. Unbeknownst to most, this state revenue is distributed amongst social programs to support childcare for low-income families, grants to educational institutions, grants to counties for unmet needs, cleaning of streams and riverbeds, support for healthcare, and to law enforcement to fight illegal, unlicensed, and therefore unregulated, cannabis operations. All told, California state officials distributed more than one billion dollars in cannabis taxes last year.
At the County level, benefits vary by county, but for Lake County, the poorest county in the state, cannabis revenue to date for fiscal year 20-21 has exceeded expectations by $2.3 million dollars. It may not seem like much, but for Lake County, the total–year to date– cannabis revenue of $7.5 million dollars represents an impressive 11% of the county’s total General Fund budget. Specifically, allocation of these funds will go to law enforcement, economic development, youth education programs, workforce retention and development, Planning/Code Enforcement/Water Resources Departments, and Cann Grants. Cann Grants are internal grants county departments can apply for, and some of the current Cann Grant recipients are the Lake County libraries for increased staffing to provide additional community access, Public Services for a Lake County Recreation Center feasibility study, the Sheriff’s Department for a dedicated Sergeant to focus on issues resulting from illegals cannabis operations, and Environmental Health to mitigate the negative effects of illegal cannabis grows on Lake County waterways.
But what about those jobs? Lake County’s unemployment rate was 9.0% at the end of December 2020 which was up from 5.1% in December 2019. This means approximately 5,900 people in Lake County need employment. At Pro Farms, we now have over 135 full-time, year-round positions making us a new, major employer in the county. To operate our farm and processing facility, we rely on the goods and services of other businesses, and almost daily, we source those goods and services locally supporting the on-going employment and income of others in our community. We are just one of the growing numbers of legal cannabis businesses operating in Lake County, and there are hundreds more legal cannabis businesses currently navigating the licensing process that will enable them to commence operations which will bring even more jobs and positive economic impact to Lake County.
Nelson Mandela once said, “Poverty is not an accident. Like slavery and apartheid, it is man-made and can be removed by the actions of human beings.” It’s time to take action in Lake County. Prohibition has ended and the legal cannabis industry has proven it’s creating good paying jobs, generating significant tax revenue for the County, supporting a multitude of local businesses, and donating money and fresh produce to good local causes. Let’s allow legal cannabis businesses to be successful in our county which immediately helps our economy rebound and ultimately flourish.
—Wil Crummer is CEO of Pro Farms in Lakeport.
