General Plan Policy Options: Cannabis
The legalization of marijuana by California voters has created a new revenue opportunity for jurisdictions throughout the state. From January 2018 to October 2020, the California Department of Tax and Fee Administration reported that the total program revenue from cannabis sales, excise, and cultivation taxes have generated $1.8 billion dollars. Many jurisdictions are actively recruiting cannabis businesses to locate in their communities to boost tax revenues and generate local jobs. The City of Hollister has already made investments to support growth of the cannabis industry, including hiring a full-time Cannabis Affairs Manager. According to Hollister’s Cannabis Affairs Manager, Hollister currently has five fully-operational cannabis manufacturing facilities, the majority of which are located near the Hollister Municipal Airport. On the outskirts of the city (in the unincorporated County), there are also several cultivation facilities. The City’s Cannabis Affairs Manager highlighted Hollister’s geographic location as the prime driver of demand for cannabis production space in Hollister. Hollister’s proximity to the Bay Area and Central Valley and its location along major highways provide access to a large population. These operations generate additional tax revenue to support City services, at roughly 5 percent of gross sales. According to the City’s fiscal year (FY) 2020–2021 City Budget, Hollister expects to receive roughly $500,000 in cannabis-related business taxes, though some cannabis operations are not yet operational and therefore the expected annual cannabis-related revenue is likely to steadily increase as businesses continue opening. As the cannabis industry continues to evolve, the City could elect to do all, some, or none of the options below.