Farmersville Holds Public Hearings on Potential Sales Tax Increase, Marijuana

At the July 17 Farmersville Public Hearing there were fewer individuals speaking on the subject matter than there were council members present.

Farmersville is seeking public comment regarding the possibilities of putting an additional ½ cent sales tax measure and a marijuana cultivation initiative on the ballot in November.

A July 14 public hearing netted about the same result.

During the June budget discussions, a number of possibilities for additional revenue were discussed, said Mayor Paul Boyer. The two with the most potential were the sales tax measure and a regulatory taxation on the cultivation of marijuana.

“The council did not want to purse a dispensary,” he said.

Additional funds are needed to help with police and fire services, as well as street and infrastructure maintenance, and parks and recreation, he said.

Local resident and school board member Alice Lopez spoke first during the comment period.

She stated that she understood the need for the ½ cent sales taxation and was all for it, “to keep services as they are, or increase services.”

While she made no direct comment regarding the possibility of a cultivation business, she said she definitely opposed the opening of a dispensary within city limits.

That would be “bringing on more than our services can handle,” she said. “I truly believe we will have more problems if we allow marijuana to be sold.”

Ricardo Lopez said he completely disagreed. He feels that a medical marijuana dispensary would be an asset, he said, and there are a lot of people who need it. It could create a lot of revenue, using Oregon as an example, he said.

James Mark agreed with Ricardo Lopez. Mark, who grew up in Farmersville but lives in Visalia, cited how much the state of Nevada made in its first day of legal sales.

“I believe it takes drug dealers off the streets,” he said.

Mark said he has had a card for 10 years, for his stomach issues.

“I believe it can help this city a lot,” he said, “it just depends on how big you want to make it.”

Caesar Esphonceda agrees with the other gentlemen, he said. He suffers from pain in his leg, where he has a rod, and uses medical marijuana.

Esphonceda thinks it is a good way to get people off the streets and working. He’d also like to see a dispensary, where people can go and be relaxed without being judged. He promoted eatables as helping with pain versus the use of narcotics, which are also bought on the street.

The public hearing was not closed, but again continued to the next council meeting on July 24.

Council Members Speak to the Issues

Councilman Greg Gomez thanked those who spoke and were in attendance.

“I would be open to retail sales, if that’s what the citizens wanted,” he said. “It has to be up to them.”

Boyer added, in order for the city to balance the budget into the future, there has to be more revenue. Council considered other taxes, but set its sights on looking at a sales tax. There is already a ½ cent sales tax in place and this would be another ½ cent bringing it up to one cent sales tax over the base. This is similar to what just passed in Lindsay and what Woodlake is also considering, he said.

Boyer also stressed the fact that sales tax would not just affect local residents, but people passing through who buy or utilize services.

“On the marijuana side of things,” he said, “we have not made a decision, and we are not in full agreement of this either. But, I think we are looking at dispensaries as something we want to shy away from – there will probably be some other ones in the county.

“We will not benefit from those Prop. 64 funds. But that’s something we will have to live with.”

Proposition 64 is the California Marijuana Legalization Initiative, which passed in November, 2016. With it came legalization for individuals, age 21 or older, to use and grow a limited amount of marijuana for personal use, starting immediately after approval. The sale and taxation of recreational marijuana will go into effect on January 1, 2018. The measure created two new taxes – one to be levied on cultivation and the other on retail price.

Following the meeting, some council members made further comment.

In an interview, Mayor Pro Tem Matt Sisk said he favors the increase in sales tax.

“I think we [council members] are all in agreement on that,” he said. “We still need opinions on cannabis,” he said, “it’s up to the citizens.”

“We’re bleeding revenue,” Councilman Gomez said. “I work in Visalia and my money is spent there. Eighty percent of Farmersville’s working class works out of town and I’m sure they spend money out of town, as well.

“There’s not enough tax to get by,” he said. “We might as well capitalize on the emerging industry – if we don’t, they’re just going to go somewhere else.”

Police Chief Says

“As the mayor said, it really comes down to what the community desires,” said Farmersville Police Chief Mario Krstic. “It is legal. So, if the community says that they feel we should go ahead and allow commercial cultivation – as long as the proper rules and ordinances are put into place to have control and make sure it is done as safely as we possibly can – safely for the community and safely for the people cultivating, we will. If you look to Colorado, Oregon, Washington and now, Nevada – they have had issues.”

Potential problems include the fact that marijuana is a cash-only business, Krstic said, and large numbers of cash are stored and transported. Because marijuana is not legal in the US, but only in individual states, banks cannot deal with marijuana businesses, they are federally regulated.

And, the fact that businesses are also storing a commodity that people want, is another issue. There is the potential for theft, he said.

But, perhaps the larger given issue for the PD, will be the permitting process and monitoring, keeping track of staff.

The Mayor’s Opinion

Mayor Boyer said that the sales tax is pretty much in agreement by all of council.

“But, If you look at the shortfall this year – it’s not up to the $330,000 [potential added income from sales tax] – if you look at our fire chief and the second highest paid firefighter we have, that’s on a two-year grant that is going to run out in 2018, and I’ve got to say we have seen a dramatic improvement in the fire department since they’ve been here. We’ve had a lot of young people getting a lot of training and the responses, especially for medical emergencies, is good. And, I really want to keep our fire department the way it is. And, that’s still depending on over 20 volunteers.

“So, you look at that and OK, a sales tax would help us catch up for a while [estimating another $330,000], but, if you look at heath insurance is going up, workman’s comp is going up, and a number of things we can’t control – we’re just going to be leveled off for a while. We’ll start dipping again.”

The finance director said we could probably go for another five years, he said, “but, we don’t want to wait until the last minute.”

The city is providing a “bare minimum” of services, he said. “It would be good for our city and I think the residents would like it, if we could do more.”

Farmersville has very little sales tax revenue when compared to other local cities, he said.

Boyer said that he is for the potential marijuana cultivation initiative.

He’s not for the dispensary side of it – but he has mixed feelings.

“I compare it to – we’re building a brewery here in town and generating a tax revenue, but we don’t want to have any liquor stores selling the beer here,” he said, with a chuckle.

A dispensary is just something that he’s not sure he wants in town. He’s not interested in seeing a smoke shop either.

“There would be strict rules with the cultivation, and I know they can do extractions [medicinal],” he said. “And, if someone does that and wants to set up shop in town, we’ll be ready for it.”

For commercial cultivation under Prop. 64, the city could charge up to $25 per square foot per year, or 10% of the gross profits.

“On one acre of land,” Boyer said, “you could end up with a 20,000 square foot greenhouse. So, if you multiply that it gets you up to a half million dollars – it’s quite a bit.

“I just feel that when we’re in the financial bind we’re in – to not at least put that out to the voters, and ask them, ‘do you want to do this,’ I think we would not be doing our jobs on council.

“By the way, as I understand it the ballot for Proposition 64 in Farmersville barely passed, by maybe a percentage point – so I think that shows we are not considering something that is totally out of whack with what the community is wanting.”

The public hearing continues Monday, July 24, at which time council will most likely vote to place either or both measures on the November ballot, or not.

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