A budding cannabis industry transforms Woodlake

The city of Woodlake transforms parks and recreation with $895,527.82 in tax revenue from city cannabis taxes

WOODLAKE – Woodlake’s influx of cannabis dispensaries and cultivation sites transforms the city through tax revenue.

You won’t find any traffic lights in the small town of Woodlake, but you will find 11 cannabis dispensaries and cultivation sites, with five currently under construction and reviewed in Woodlake’s last city council meeting. The extra funds from tax revenue have transformed the city’s parks and recreation, allowing four city parks to be renovated and the purchase of police vehicles.

As more cultivation sites and dispensaries made their way into Woodlake, a historic spike in cannabis tax revenue jumped from roughly $50,000 in 2017 to $895,527.82 in 2021. In 2018, just a year after the first dispensary moved to Woodlake, the cannabis tax revenue spiked to $229,000. Cannabis taxes account for 10% of the city’s general fund. The cannabis market is starting to level out, and even with new cultivation sites, Lara predicts that future tax revenue will be similar to this year.

“Predicting future cannabis tax revenue isn’t easy,” Lara said. “It’s a moving target as the city makes sure it stays competitive and more municipalities allowing cannabis business. For the foreseeable future we expect to stay between $800,000 to $900,000 a year.”

Though the city has a population of roughly 7,700 people, its cannabis industry began blooming just one year after recreational marijuana use was legalized in California in 2016. The extra funds coming from tax revenue transformed Woodlake’s parks and recreation, public safety, streets and roads and recreational trails.

Woodlake City Manager Ramon Lara attributes a lot of the draw for cannabis dispensaries to Woodlake is how easy the approval process is, as well as the city’s indoor cultivation tax being among the lowest in surrounding counties and cities. 

“We only charge it on the flowering part of [the] business,” Lara said. “Some places may say they are cheaper, but they’ll charge you on your entire facility.”

The city’s indoor cannabis cultivation tax sits at $6 per square feet. Salinas, located in Monterey County, and Cathedral City, in Riverside County, have some of the highest rates, which are $15 per square foot, just above Farmersville at $12.

There has been a request from cannabis cultivator 7 Points to lower the cultivation tax, especially in light of the state eliminating harvested cultivation taxes on July 1. However, Lara said Woodlake residents voted on the percentage of cultivation taxes and where the revenue would be spent. This leaves the decision to change the tax up to the residents of Woodlake, not just the council. Additionally, Lara said the city has to keep up with competition from neighboring cities.

“We need to stay competitive every year to evaluate our fees and taxes, and we make sure we’re very competitive,” Lara said. “So while I understand [7 Points] concerns, the endgame is that we are very competitive to any other city in the state.”

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