Report: Economic Impact of Cannabis in San Diego County

Here’s the Executive Summary

The cannabis industry has gone through many series of events that has brought it to the billion dollar industry it is today. Since its move from the illicit market, to the legalization of medicinal cannabis in 1996, and continued positive shifts of perceptions of cannabis, there has been exponential growth in the industry.

The Office of Business Research and Analysis (OBRA) has analyzed the general impact of the cannabis industry in San Diego County. Throughout this research, OBRA sought to find how adult-use and medicinal cannabis sales increases in revenue and influences the community regarding finances, police enforcement, cannabis license types, public health, and social equity.

The cannabis industry yields a considerable amount of revenue to municipalities from cannabis city taxes. Data from public records requests from the cities of San Diego, La Mesa, and Vista illustrate the amount of money by quarter that each city has brought in since their legalization of medicinal cannabis and or adult-use cannabis.

In 2019, medicinal cannabis taxation brought in over $1M to the city of Vista. In 2019, adult-use cannabis taxation yielded over $12M to the city of San Diego and $183K to the city of La Mesa. As additional dispensaries are added, revenue numbers are expected to grow exponentially. Cannabis business license holders in San Diego County completed a survey created by OBRA that was used to analyze the industry’s demographics of those who hold cannabis licenses in the San Diego County region.

The survey results indicated that 68% of cannabis business license holders were White, 14% Hispanic, 7% African-American, 3% Middle Eastern, 4% American-Indian, and 4% Asian. Additionally, 87% of cannabis business license holder participants were male and 13% were female.

Based on these results, racial diversity within this industry remains an issue. It is advised for jurisdictions in the County to look into other cities that have successfully implemented social equity programs to increase diversity in potential cannabis license holders.

Establishing a social equity program in San Diego County could result in more racial diversity and equity within cannabis license holders. As more new entrants emerge, the cannabis industry will continue to increase in size as long as regulations allow for it. This will result in more revenue brought in by cannabis taxation.

FULL REPORT

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