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Extracted from Consolidated Report
This investigation was originally published as part of a larger consolidated report containing multiple investigations. View the consolidated PDF for the complete document.
Monterey County Grand Jury
• 2021-2022
Monterey County’s Cannabis Industry Up In Smoke
⚠️ Translation Notice: This content has been automatically translated. The original English text is the official version. Translation may contain errors.
⚠️ Este contenido ha sido traducido automáticamente. El texto original en inglés es la versión oficial. La traducción puede contener errores.
Findings 12 findings
F1
Page 82
The estimated price for finished cannabis product dropped from $1,600 per pound in 2020, to under $500 per pound in 2021, due to a glut in the state cannabis supply.
F2
Page 82
The major source of cannabis revenue in Monterey County comes from assessed square footage of cultivation.
F3
Page 82
Growers paid around $19 million in assessed taxes in 2021. An additional $1.4 million in taxes were collected from other cannabis businesses, including dispensaries processors, quality assurance testing, delivery, transportation, and disposal.
F4
Page 82
In the past five years, just under $70 million has been collected in Cannabis tax revenues.
F5
Page 82
Even with the glut of cannabis on the open market, Monterey County is still actively processing a nine-fold increase of provisional licenses over the active/complete licenses.
F6
Page 82
County FTEs (staff) have increased from 6 to 28 in fiscal 2021-22 involving multiple agencies that regulate, inspect legal cannabis, and enforce the eradication of illegal cannabis in the County.
F7
Page 82
The County Cannabis Program is the county regulatory infrastructure with a budget of $6.3 million, a third of the cannabis tax revenue in 2021.
F8
Page 82
Consumers also pay state Sales Tax, state Excise Tax, and county or city sales taxes which results in a four-fold increase in price compared to unlicensed/illegal cannabis.
F9
Page 82
Allocation of the Cannabis Tax/Assignment Fund (CTF) is difficult to track. The increase of property values due to requirements of the Cannabis Program has not been available to the public. 66
F10
Page 83
To help the passage of AUMA, the Board of Supervisors stated the new industry would bring new economic development and jobs to counter losses from NAFTA twenty-two years prior.
F11
Page 83
Monterey County did not hire an Economic Development Manager and staff until November 2021, five years after the Cannabis Program was established. The number of new jobs remains unknown.
F12
Page 83
Many inspections do not operate in a consistent manner nor with a standardized check list.
Recommendations 6
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R1Page 83Require the Monterey County Cannabis Program to provide a comprehensive annual report detailing all CTF revenues, allocations, and reserves. This report should include detailed information including budget and distributions to community service agencies. The Cannabis Program must publish its annual report on their website. Implementation
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R2Page 83Revise Monterey County Cannabis Program webpage to include easy-to-follow directions for accessing revenues and expenditures. Implementation
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R3Page 83Monterey County to monitor and report on improved property value and tax re- assessment due to Cannabis Compliance Regulations. Implementation
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R4Page 83Direct the Economic Development Manager to complete a study on new jobs created by the cannabis industry and its impact on the local economy. Implementation
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R5Page 83Include in the Cannabis Program annual report, an accounting of all FTEs funded by the CTF. Implementation
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R6Page 83Cannabis Program adopt a consistent process for inspection and check list. Implementation