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Legal weed could bring in revenue

When it comes to sales tax revenues from marijuana, cities, towns and counties will benefit.

Tonasket collects about twice as much sales tax as property taxes, Mayor Patrick Plumb said, so the city could receive a bit more income if a marijuana retailer, like Green Valley Living, is able to set up shop.

However, so far the listed producers and processors are located outside of town, so Okanogan County would collect the taxes instead.

Okanogan County commissioners will hear public comments at a hearing at 6 p.m. Monday on a recommendation that could eliminate a step for new businesses to start operations. Commissioners meet in the Grainger Administration Building, 123 N. Fifth Ave., Okanogan.

Liquor Control Board spokesman Mikhail Carpenter said only the state will collect excise taxes. A 25 percent excise tax is levied at each level, from producer to retailer, and the proceeds will go into a marijuana fund established in Initiative 502, which nearly 56 percent of voters approved statewide in 2012.

In Okanogan and Ferry counties, I-502 also gained favor at about 51 percent. Douglas County, on the other hand, rejected the measure with 49 percent in favor.

Jeremy Moberg, president of the Okanogan Cannabis Association, estimated the marijuana business could bring in hundreds of jobs and generate upwards of $240 million a year. The state has estimated it could receive up to $2 billion in the first five years from sales taxes.

Some are skeptical of the proposed benefits and have actively worked to counteract state law on a local level.

Okanogan County Community Coalition Co-Director Andi Ervin has said she hasn’t seen any solid evidence that marijuana will benefit the economy.

“How many jobs? What is the expected wage? There is no real answer to these questions, because this is an experiment,” she wrote in an earlier statement to The Chronicle.

A few towns have taken measures against the new law. The coalition helped Omak and Oroville craft zoning amendments to keep out medical marijuana dispensaries and collective gardens, and Bridgeport extended a moratorium in August for another six months to fend off marijuana business applications.

Medical marijuana is not addressed in I-502, and Liquor Control Board Director Brian Smith has said there are no provisions that allow municipalities or counties to “opt out” of the new state law.

While the county’s planning department suggested new businesses in unincorporated areas be required to get a conditional use permit before establishing their crops and stores, the Planning Commission has recommended commissioners allow the businesses without a permit.

According to a memo from Planning Director Perry Huston, the commission opted to lean on the state law’s guidelines for safety and where businesses can operate.

As of Friday, Omak, Brewster and Oroville reported no one has filed for business licenses or zoning permits.

Throughout Washington, there were 635 applications for producer licenses, 461 for processor licenses and 230 for retail, as of Tuesday.

The state has limited the number of retailers each county can have. Okanogan County gets five, with one specifically allocated in Omak; Douglas County gets three, with one designated for East Wenatchee; and Ferry County can have one shop.

There is no limit on the number of processor and producer licenses the state can dole out.

From start to finish, a producer grows the marijuana and sells it wholesale to processors, which package and label products to sell wholesale to retailers.

Producers are separated into three tiers based on the square footage of the canopy to grow marijuana, Tier 1 being the smallest. Okanogan County so far has the fourth-largest number of applicants statewide for Tier 3 producers – 17 – which would mean crops between 10,000 and 30,000 square feet. The county is behind only Snohomish, Spokane and King counties.

There are six Tier 2 applicants so far in Okanogan County, and three Tier 1. Tier 2 allows for a crop between 2,000 and 10,000 square feet, and Tier 1 crops will be smaller than 2,000 square feet.

There is one Ferry County applicant. Okanogan Highlands Cannabis, 415 N. Empire Creek Road Suite A, in Malo, has filed for a Tier 1 license.

One company in Brewster, 509 Da Kine, counts among the six producer applicants in Douglas County, while the rest are located in East Wenatchee. The owner, listed on Bizapedia as John Simmons of Brewster, is seeking a Tier 2 license as well as a processing license.

Okanogan County has 16 processor license applications. Douglas County has three, one of which has a Brewster address.

There is one retailer applicant in Douglas County, in East Wenatchee. No one has filed yet in Ferry County.

Not everyone on the list will forge ahead if they’re granted a license. A&J Enterprises of Carlton, which applied for a Tier 1 producer license and a processor license, told The Chronicle they likely won’t pursue operations.

“We applied for it just to kind of get our name in the hat and kind of get that thing going,” said John Wagstaff, who owns the company with his wife Ann. The state won’t allow them to use an already-established facility, he said.


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