Salinas is generating big cannabis tax revenue. The question now is how to spend it.

Tax revenue from cannabis sales in Salinas has almost quintupled from 2017 to 2020, and now some city councilmembers, urged by members of the public, are asking that part of the revenue be directed toward community and drug prevention programs.

During a City Council meeting on March 2, Councilmember Tony Barrera said the community needed more services for children, the elderly and low-income residents. “We have financial resources that we can allocate to establish these programs and we are not just doing it,” Barrera said.

When the city established its cannabis business tax program in 2016, the revenue wasn’t assigned to any specific purpose. City Manager Steve Carrigan suggested putting it into the general fund – allocations from the general fund can be used widely, including to repair and improve recreational areas.

In addition, Carrigan says, it’s better if specific programs or projects aren’t attached to specific revenue, such as the cannabis taxes, because if the revenue drops it can impact services. “Let’s put it in the budget,” Carrigan says. That way, “it stays in the budget and it’s not tied to the revenue.”

In 2020, cannabis tax revenue in Salinas generated over $1.8 million that went into the general fund. It also generated $166,199 in monitoring and enforcement fees.

City Council’s cannabis subcommittee – comprising councilmembers Carla González, Steve McShane and Orlando Osornio – will discuss enhancing or adding new community programs to the list of cannabis-related expenditures. Then, the issue will go to the finance subcommittee for pre-approval before going to the full council for approval.

That process is expected to take at least a month before it is discussed at a council meeting.