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Central Coast cannabis industry in crisis

June 21, 2023

By KAREN VELIE

Amid plummeting tax revenues in the cannabis industry, San Luis Obispo and Santa Barbara counties have taken different routes with one electing to lower taxes and ease regulations and the other voting for stricter enforcement.

On Tuesday, the SLO County Board of Supervisors voted to lower the cannabis tax and to look into reducing fees for cannabis businesses, allowing retail shops in the county and increasing delivery hours.

Currently, SLO County charges an 8% tax on gross receipts. On Tuesday, the board discussed whether or not to move forward with an already approved 2% rate increase set for July 1.

Supervisor Debbie Arnold argued that county residents should not subsidize the cannabis industry. While Supervisor Bruce Gibson agreed that county taxpayers should not fund the pot industry, he said he would consider reducing the tax rate.

Supervisor Dawn Ortiz-Legg wanted to freeze the tax in order to allow the industry to prosper. She also wanted to expand the delivery hours from 9 p.m. to 10 p.m. and to allow retail stores.

The board then voted 4-1 to stop the 2% cannabis tax increase set for July 1, with Arnold dissenting.

SLO County’s Legal Counsel Rita Neal told the board they would need to have county staff come back with further proposed changes to the cannabis ordinance. The board then voted to bring back a proposed 6% cannabis tax, an extension of delivery hours, permitting pot shops in the county and lowering fees.

While Santa Barbara County projected $16 million in cannabis tax revenues for the 2022-23 fiscal year, it now anticipates it will collect less then $6 million.

Amid a massive over production of cannabis in the state, prices for legal cannabis have fallen about 50% in six years. Meanwhile, pot users can find black market cannabis at 30% to 60% the price.

On June 6, the Santa Barbara County Board of Supervisors voted to move forward with strict penalties for those growers failing to pay their tax payments on time. After missing even one payment, the board voted the county could revoke permits.

To date, Santa Barbara County has approved all requests to renew cannabis business licenses. On June 27, Santa Barbara County supervisors are scheduled to vote on amending the county’s 2018 cannabis ordinance.


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What you’re seeing is the result of stupid and greedy politicians. California voted to legalize cannabis; I doubt anyone was expecting the level of greed and corruption that surfaced when local governments got involved. The best way to make businesses fail and to create a thriving black market is to tax and control all aspects of the industry. Grapes seem to be taking over SLO county; why not treat cannabis the same way as grapes?


14

I’m sure all the government entities that went ahead and created budgets and spent the money on the projected income have now reduced budgets and cut those items that now don’t have the fund to maintain and now won’t be spent until the actual tax revenue is received, yeah right.


8

In Santa Barbara County, one of the corrupt county supervisors, Steve Lavignino, took money from the marijuana industry as he was tasked with writing the regulations for their industry. Lavignino corruptly gave them huge loopholes in how they report the weight/value of their crops, and it has cost taxpayers millions of dollars.


He is so poorly thought of after the scandal broke, that he is not even going to try to get reelected, he says he is retiring.


Elections have consequences, and voters enabled Lavignino’s corruption.


21

“Steve Lavignino, took money from the marijuana industry”


For these allegations, you have proof? I find it very hard to believe that Lavagnino, a former staunch Republican who has become an independent, is on the take. VERY hard to believe.


I know he has been badgered by a Carpinteria citizens group who never contributed anything to the conversation until one morning they woke up and realized their little seashore town reeked of ganja. Of course, their knee jerk reaction was to blame the County Supervisors, who consistently asked for their input along the way but got none. Lavagnino and Das Williams were given a difficult task to write the rules for cannabis. They may not have realized every factor or gotten every t crossed, but they did get things up and running. It’s a new industry. There will be hiccups.


To these allegations, Lavagnino said, “I’m not interested in rehashing the same tired accusations. My focus is on tackling this county’s many needs — addressing homelessness, improving our mental health delivery system and responding to our recent flooding issues, all of which require the additional revenue cannabis generates.”


I’ll await chapter and verse about how Lavagnino is corrupt and “took money.” I’ll lay you 100-1 you have no such evidence. Quit spreading lies.


-16

No amount of trolling can cover for corrupt Steve Lavignino.


Despite your denials, the CFPP chronicles a $16,000 donation from the marijuana growers to SB County Supervisor Steve Lavignino AT THE VERY TIME WHEN CANNABIS LAND-USE CHANGES WERE BEING DECIDED. The donation occurred the week Lavignino and Supervisor Das Williams were selected in 2017 to write the draft ordinances which would affect the marijuana industry. Required legal reporting reveals the money Lavignino took represented about 12% of all the contributions Lavignino received.


What the marijuana industry got for its investment in Lavignino? After receiving the highly dubious campaign cash from the marijuana growers, Lavignino proceeded to create a series of highly unusual ordinances which would favor the industry and provide loopholes in the figuration of taxes on their marijuana growing, and it has cost taxpayers millions of dollars in uncollected revenue, and saved the marijuana moguls untold amounts of money.


The unethical and reckless behavior by Steve Lavignino has earned he and Supervisor Das Williams(who co-authored the ordinances) the monitor “The Doobie Brothers”, and the stench from their behavior continues to undermine the fortunes of both men in the Santa Barbara political scene.


The information above is easily available with a google search, and the CFPP commission chronicles mandatory campaign disclosures.


Steve Lavignino is a corrupt politician.


Now you know the rest of the story.


5

Campaign contributions from a legitimate donor who went through all of the proper hoops to make sure it was a legal donation. Nothing “highly dubious” about it. That Mr. Lavagnino somehow bent the rules or favored one area of the county over another is what is “highly dubious.” Lavagnino has said his decisions on marijuana cultivation were totally independent of any contribution to his campaign. I will take him on his word. I mean, why would Lavagnino ruin his reputation for a measly $16,000?


In 2016, the billionaire Mercer family donated $20 million to the Trump campaign. In 2017 they benefited several million dollars from the largest tax cut in history as Trump signed a bill which lowered the Mercers’ and other Trump corporate donors’ tax rates from 35% to 21%. In your world, Trump must also be a “corrupt politician” since his decision ultimately benefited the Mercers.


-7

Deflection is not a viable response!


If you did your research, as I encouraged, you would see that many citizens took exception to Steve Lavignino’s corrupt actions. He literally began taking money from the marijuana industry the very week he was charged with making decisions which would affect their bottom line. That you cannot connect the dots leads me is incredulous, and I would remind you that denial is not just a river in Egypt.


After taking the money, Steve Lavignino cast aside the work that many other California counties did in creating a proven method to accurately measure the value of the marijuana crops grown on acreage, and he developed his own dubious formula, which he now admits does not work, and advantages the growers to the tune of millions of dollars per year. The audacity of Mr. Lavignino’s corruption is breathtaking, and he even has the audacity to now support tax increases for SB County residents. Shameful!


Lastly, your shameless ‘pivot’ to discussing another politician is just an attempt to change the narrative as you lose the argument. I can respect people whose opinions differ from mine, but have no respect for people like yourself who try to defend the indefensible, and also attempt to deflect from the issues being discussed.


Politicians like Steve Lavignino are the reason so many of our young people have grown disillusioned with politics, and it will be healthy to see him removed from the body politic. Lavignino may have unethically accepted the legal campaign contributions, but he is leaving office soon, and I would anticipate that he will get more pay-to-play cash from the marijuana moguls once he is outside the public eye.


Corruption sucks, and so does Steve Lavignino.


1

I can’t respect someone who levels totally unfounded allegations of corruption (those contributions were TOTALLY within the law) against a man who has won four elections. Obviously the majority of voters do not see Mr. Lavagnino as corrupt. He has done many very positive things for the Santa Maria Valley and comes from an outstanding family that has given back much more to the community than they have taken.


I’m still waiting for some kind of evidence that Lavagnino was on the take for the marijuana industry. All you’ve offered is that he took a campaign donation from a local industry. If you don’t like industries being able to contribute to politicians then oppose Citizens United.


In my opinion, your libelous accusations are “Shameful.” Your type of libel against a well meaning politician is precisely why “our young people have grown disillusioned with politics.”


-3

Enough.

Also: mjd “Please address the Policies, events and arguments, not the person.”


-2

The Government was against it but then saw the possible cash cow so they put high fees on the sellers/growers where it wasn’t worth the trouble so back to the black market sellers Government cash cow gone


26

What crisis? The city of Lompoc has netted $3.4 million in tax revenue from legalized weed in just two years—went to recreation facilities for kids and law enforcement, including more money for addiction counseling.


Can you imagine what the Santa Maria/Orcutt area would bring in if they allowed the demon weed? I’m sorry, but, yes, business’s succeed and business’s fail. Cannabis is the same as any other. I just don’t get that it’s a crisis. How is it a crisis if a business fails and plenty of small growers are not seeing the revenue they expected. It happens in the restaurant industry every day.


Small businesses will fail. The fittest will remain. It’s the American way. It’s called capitalism.


-8

Really? I think we were promised to get so much tax money we could pave the streets with gold.

“Missed it by that much” – Maxwell Smart


50

Yes, I also recall that the taxes received, would be used to enhance all our cities and neighborhoods, make life better, and dogs and cats would live together in harmony…..until the buzz wore off.


“Juuuuuust a bit outside” – Bob Uecker


25

Wonder how much of the tax revenue went to build the sweet (sarcasm) bike lanes going in everywhere that never get used?


25