Vancouver to receive $790,000 in pot excise taxes

It's the highest amount of any city in Washington

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The presence of recreational marijuana stores in Vancouver and Battle Ground is finally paying off for the two cities, which received their first cut of marijuana excise tax revenue from the state this week.

Vancouver will receive a total $790,500 for the state’s 2016 year fiscal year, which runs July 1, 2015, through June 30, 2016. That’s the highest amount of any city in Washington, according to statistics from the Association of Washington Cities.

Vancouver, which has six retail marijuana shops, received its first quarterly payment of $197,600 Wednesday. Battle Ground, which will get $35,600 total for 2016, received its first quarterly installment of $8,900. It has one retail marijuana shop.

Two of Vancouver’s pot shops — Main Street Marijuana and New Vansterdam — consistently post the highest sales figures in all of Washington.

On Thursday, Vancouver City Manager Eric Holmes said he was surprised at how much money Vancouver was getting in marijuana tax revenue. He noted that the long-term reliability of the revenue amount was uncertain, given that Oregon legalized sales of recreational marijuana Thursday, which could draw out-of-state customers away from Vancouver’s pot shops.

Clark County, Woodland, La Center, Ridgefield, Washougal and Camas aren’t getting any of the revenue because those jurisdictions have enacted moratoriums banning shops that sell recreational marijuana. However, that could change in Camas; this month, its city council will consider its city planning commission’s recommendation to allow the establishment of retail marijuana sales in certain zoning districts. The state had earlier approved six retail marijuana shops in unincorporated Clark County.

In June, the Legislature changed the state’s recreational marijuana law, Initiative 502, to provide for local revenue sharing. Under House Bill 2136, the state will distribute the marijuana excise tax revenue every quarter based on the prior fiscal year’s total actual retail sales within the jurisdiction. There aren’t any restrictions on how the money may be used.

According to the state Liquor and Cannabis Board, the total marijuana sales (sale price plus tax) from July 1, 2014, through June 30, 2015, tallied almost $260 million. Of the $6 million in marijuana excise taxes Washington state will distribute this fiscal year, cities will receive 40 percent, and the counties will receive 60 percent.

Because Clark County doesn’t allow recreational pot shops, Vancouver and Battle Ground received the county’s share of tax revenue, which would have totaled $496,000 for the 2016 fiscal year, according to Brian Smith, spokesman for the state Liquor and Cannabis Board.

Vancouver’s marijuana revenue of $790,500 amounts to a little more than a half 1 percent of its $137.7 million general fund budget for 2015, according to Lloyd Tyler, the city’s chief financial officer.

Holmes said even though there hasn’t been a spike in crime related to Vancouver’s retail pot shops, he expects city staff will recommend the money go toward public safety. The city council will amend its budget in January or February to reflect the new revenue and decide where to spend it, he said.

“I think there is a natural nexus in revenues from the sale of that product and funding our public safety,” he said.

Asked whether that meant citizens could support the police department by purchasing marijuana, Holmes replied, “people can support their community in many ways by shopping local — not just for marijuana. … It helps support critical local services.”

Battle Ground’s $35,600 amounts to 0.3 percent of its $11.8 million general fund budget for 2015.

“For small cities, any additional source of revenue is always welcome, but does it really assist with the long-term financial viability of any city? Not so sure,” said Maggie Smith, Battle Ground’s finance director. “Like any revenue, it depends on the sustainability.”

Amy M.E. Fischer: 360-735-4508; amy.fischer@columbian.com; twitter.com/amymefischer