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Unlike the businesses forced to close during the stay-at-home order, the state government deemed cannabis cultivation essential, giving Santa Barbara County an unaffected revenue stream as it faces losses in sales tax and transient occupancy tax.

According to a staff report for the Board of Supervisors’ May 19 meeting, Santa Barbara County collected $1.9 million in cannabis tax revenue during the third quarter of the current fiscal year. It's a 43 percent increase in the cannabis tax revenue over the same quarter last fiscal year. The county received an additional approximately $800,000 too late for it to be added to the quarter, but that money will be counted in the fourth quarter.

Andrew Rice, a spokesperson for the North County Farmers Guild—a group of cannabis farmers—attributes the increase to a number of new projects that the county approved, which, in turn, increased overall crop production. Rice said, similar to wine, the county is developing a reputation as a source of premium cannabis that commands a higher price compared to other regions.

Excluding the roughly $800,000 that’ll be added to the last quarter, the county has received $6.7 million in cannabis tax revenue so far this fiscal year. That’s the same amount the county received during the 2018-19 fiscal year, according to the staff report.

This extra revenue will come in handy, as supervisors indicated during an April budget workshop that they plan to use excess cannabis revenue to bridge gaps in sales and transient occupancy tax (TOT). During the workshop, county staff estimated the county will lose $3 million during the current fiscal year, but that it’s unclear what the loss will be for the next year, which starts in July.

“I think it’s an important part of a three-legged stool that we have now with sales tax, TOT tax, and now the cannabis revenue,” 5th District Supervisor Steve Lavagnino said during the workshop.

In addition to going over these tax receipts during the May 19 meeting, county staff will discuss more details of the quarterly cannabis tax receipt report, including compliance efforts and enforcement actions taken during the quarter.

The board meeting starts at 9 a.m. on May 19 and can be livestreamed on the county’s YouTube page. In-person participation is prohibited due to COVID-19, but residents can submit written comments prior to or call in during the meeting. ∆