Manzanita voters will decide whether to prohibit marijuana sales and processing businesses within the city limits (Measure 29-138) in the Nov. 8 general election.
And with that, they’ll also decide the future of Oregon Coast Cannabis (OCC), the livelihoods of the pot dispensary’s 17 employees and whether the city will benefit from funds generated by the state’s hefty sin tax on recreational marijuana sales, according to OCC co-owner Andrew J. Buck.
“While we would try to keep Oregon Coast Cannabis alive in some form even if the measure passes, the fact is we would have to lay off virtually our entire staff,” said Buck, who has been operating the business with his partner, Hannah Hayes, since Labor Day Weekend of 2015. “That is more than a dozen jobs held by people we care about and the families they support. I don’t think we can emphasize enough how devastating this would be for them and us… and our city would lose out on significant tax revenue.”
In November of 2014, Oregon voters approved Measure 91 which regulates, taxes and legalizes recreational marijuana use for adults 21 and older.
Manzanita is within the Pine Grove voting precinct for state elections. For city elections Manzanita voters can be separated out, but the ballots are combined with other Pine Grove precinct ballots for tallying any county or statewide elections, according to election rules.
Manzanita City Hall records show the vote on Measure 91 in the Pine Grove precinct was 637 voting yes, to 361 voting no. In that same election, 367 Manzanita voters turned in ballots. The Tillamook County Clerk’s Office stated there is no way to go back and determine what the Measure 91 vote was within the City of Manzanita.
In 2015, the state Legislature voted to allow local governments to prohibit the sale and processing of marijuana within city limits via voter approval. The Manzanita City Council adopted an ordinance last August to put such a vote to the people in November.
“Some persons see no harm in allowing marijuana facilities within the city,” Manzanita City Manager Jerry Taylor wrote in a memo to the council. “Others would argue that it is not right to allow stores selling a product that is still considered illegal by the federal government. There are good arguments on both sides of this issue. But the bottom line is that this is an issue that calls for resolution by a city vote.”
City councilors agreed.
“The council decided it wasn’t fair for the council to make the decision of approving retail sales within city limits and the Legislature determined it could be put on the ballot for the people to decide,” said Councilmember Michael Scott, who is also running unopposed for mayor. “They did that in Cannon Beach and a referendum of the people put in on the ballot anyway.”
Annie Naranjo-Rivera, a Manzanita city council candidate, said it shouldn’t be on the ballot regardless.
“I think the voters have already decided when they approved Measure 91,” she said. “I think this is a waste of time.”
If Measure 29-138 passes, state law would still allow continued operation of medical marijuana processors and dispensaries already registered that have successfully completed a local land use application process.
OCC falls into this category and would be permitted to stay open as a medical marijuana facility only, beginning Jan. 1, 2017. However, with recreational sales to tourists being a bulk of its business, it would be a major financial hardship for the dispensary located at 868 Laneda Ave. on Highway 101.
“We would definitely operate medically as long as we could,” said Hayes. “But that would definitely entail some cutbacks on employees. For longevity, operating as just a medical dispensary would be exceedingly difficult.”
Sin tax surplus
If the ban is approved, OCC and its employees wouldn’t be the only causality, according to state officials.
Economists estimate Oregon will take in about $43 million in tax revenue from recreational cannabis sales this year. Medical marijuana is not taxed.
The current 25 percent recreational sales tax will be replaced next year with a permanent 17 percent rate set by the Legislature. Cities and counties can adopt ordinances that add up to three percent more.
Tax disbursements back to the communities will depend on the number of Oregon Liquor Control Commission dispensaries licensed for recreational use within a municipality. Public entities slated to benefit from those funds include:
• Common School Fund – 40 percent
• Mental health, alcoholism, and drug services – 20 percent
• Oregon State Police – 15 percent
• Cities for local law enforcement – 10 percent
• Counties for local law enforcement – 10 percent
• Oregon Health Authority – 5 percent
Buck estimated OCC has paid $140,000 to the state in recreational sales tax since the beginning of the year. Cities choosing to prohibit licensed facilities won’t receive any marijuana tax funds – including Manzanita if voters approve Measure 29-138.
Moreover, Buck said the city would be missing out on an industry with a long and prosperous future ahead.
“We strongly believe that cannabis is Oregon’s next great craft industry, just like wine and craft beer before it.” he explained. “To us, that means sourcing our products from artisan producers and it means supporting local economic opportunity throughout our supply chain.”
OCC staffers said in addition to the hurdles they’ve faced developing the operation, they’ve been working hard to dispel myths surrounding cannabis use, promote its legitimate benefits as a legitimate business and educate the public about the impact Measure 19-138 would have.
So far, they say community and customer support has been overwhelmingly positive.
“This is a really incredible community and that is something we all want to be a part of and we want to positively impact the community,” said Molly Hayes, OCC inventory manager. “It’s been a little scary but we’ve been talking to a lot of people and we know we that we have support. We need to make sure that everyone knows that we need them to vote no on this ban.”
Scott added he didn’t think the ban would be approved.
“They have been up there for a year and a half and have been good corporate neighbors with no trouble that I’m aware of,” he said. “My gut reaction is that it probably won’t pass.”