Farmersville lowers cannabis tax to 5% of gross receipts and $7 per square foot for cultivators

By Crystal Havner
Special to the Sun-Gazette

FARMERSVILLE – Commercial cannabis has been a quandary for local governments thus far in Tulare County. While Woodlake has welcomed the first commercial cannabis shop in the Valley over a month ago what that means for City coffers is currently unclear. But what Farmersville knows is nobody is breaking down their door to locate along Highway 198 or anywhere else in the city. 

As of last Monday, June 11, the City Council held a public hearing over the tax rate for commercial cannabis related business in the city. The rate was set at 8.75% of gross receipts for retail sales and $12 per square foot for cultivators. But with no prospective businesses the Council voted to reduce their tax rate. 

The City of Woodlake currently chargers 5% on gross receipts and $6 per square foot for cultivators. Farmersville’s council considered lowering the rate to $7 a square foot and 2.5% gross receipts in response.

Mayor Paul Boyer was concerned about getting in a price war with neighboring cities.

“I don’t want to be like the two gas stations downtown,” said Boyer. “We can’t keep lowering prices until we are not making any money.”

Council member Greg Gomez responded, “Right now we don’t even have any pumps. We have to have something before there can be a price war. Right now, we are not getting anything. Our rates are way too high. People will go to Fresno or Woodlake to get it and the tax money will stay there.”

City resident Alice Lopez asked the council to consider the community when they made their decision.

“You have to ask yourself how this is going to effect the city,” said Lopez. “Money isn’t everything. You keep telling me this is going to be profitable, but how is it going to affect our health and welfare?”

Juan Hernandez from Central Valley Alternative addressed the council.

“I feel like 2.5% is a fair rate,” he said. “It is not a violent drug. Alcohol is more of a public hazard.”

City manager Jennifer Gomez explained that the city needed to remain competitive.

“There is no water, sewer or electric out there,” she said. “All that will have to be put in by the developers.”

The Council passed a measure to make the tax rate 5% of gross receipts and $7 per square foot for cultivators, only after failing to pass a measure for 2.5% of gross receipts and $7 per square foot.

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