Westland Forecasts $4 Million in Revenue from Cannabis Retail by 2029

May 3rd, 2024 Legislation & Policy Updates
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Westland, Michigan anticipates a significant boost in revenue from its retail recreational cannabis businesses, estimating an income of roughly $4 million over the next six years if all five retail licenses are issued. This projection was highlighted in Mayor Kevin Coleman's recent budget proposal and forecast.

The city is set to receive an estimated $665,000 in tax revenues from local cannabis establishments for the upcoming fiscal year, beginning in July, which will contribute to the city's $82.5 million budget. This revenue accounts for about 1% of the annual budget, and according to city officials, it is poised to have a substantial impact on various municipal needs, including staffing, public facilities, and the public safety vehicle fleet.

Finance Director Steve Smith commented on the importance of this revenue stream: "That might not seem like a lot, but on a per-year basis – next year we're looking at $665,000. That's a lot of money. If we don't have that, we'd notice. It adds up."

Currently, Westland has utilized one of its five retail cannabis licenses, with LIV Cannabis at 37655 Ford Road being the inaugural establishment. Last fiscal year, LIV Cannabis contributed $58,000 in revenue through excise tax. The city, which approved recreational cannabis businesses in 2019, is reviewing three additional proposals for retail licenses.

In Michigan, cannabis is subject to a 10% excise tax. Localities also benefit from increased property taxes on buildings that have been renovated to accommodate these businesses. Smith noted that while the additional revenue is not earmarked for specific uses, it could potentially fund significant municipal projects, such as new public safety equipment or infrastructure improvements.

Mike Elias, CEO of LIV Cannabis, emphasized the unique financial contributions of the cannabis industry, stating, "You're seeing tax revenue coming out of cannabis that no other industry has been able to provide at the speed we have. When you think about the tax potential, it's exponential."

The decision to allow recreational cannabis businesses was also driven by potential economic benefits, such as the redevelopment of underutilized properties, according to Westland Planning Director Mo Ayoub. He observed that these establishments have spurred economic development and renovations in previously blighted areas.

LIV Cannabis aims to integrate into the community by engaging in charity work and collaborating with local organizations like the Rotary Club. Jordan Felix, General Manager of LIV Cannabis, described the diverse clientele they serve: "It can be the 21-year-old who just had a birthday or the 70-year-old who's never been in a dispensary. It's a wide demographic and we're trying to be inclusive. I think the reception has been great."

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