City Council
MEETING DATE: 11/29/2017
TITLE:
Title
Resolution Establishing a Priority List for the Use of Cannabis Tax Revenues
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FROM:
Charlie McClendon, City Manager
RECOMMENDATION:
Recommendation
Staff recommends the City Council approve a resolution establishing priorities for the use of Cannabis tax revenues.
Body
BACKGROUND:
Council has had several discussions in recent weeks regarding the uses and priorities for anticipated and potential cannabis tax revenue. Most recently Council discussed the topic on November 8 and asked staff to prepare a resolution outlining the priorities discussed. Cathedral City voters have approved taxes on all types of cannabis businesses in Cathedral City. During Fiscal Year 16-17 the various taxes raised $449,961, a year during which only one business was open for the entire year. The adopted budget for FY 17-18 anticipates revenue of $1.25 million from cannabis business and the FY 18-19 budget anticipates revenues of $2.5 million. During those two years any excess cannabis revenues will need to be applied to projected shortages in other revenue sources anticipated due to declines in the general retail sector.
DISCUSSION:
During the discussion on November 8, 2017, Council identified some priorities for the use of cannabis tax revenues when it exceeds the amounts identified in the current biennial budget and as budgets are developed moving beyond the current biennium.
1. Financial Stability - revenues should first be applied to covering any budget imbalances so the strong financial position of the City can be maintained. This would include covering any declines in other revenue sources and maintaining necessary cash reserves according to adopted financial policies.
2. Public Safety - revenues should be used to enhance Public Safety in the community including covering the costs to keep the recently authorized Firefighter/Paramedic positions once the grant funding expires, including required pensio...
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