Memorandum
Date: September 14, 2021
To: The Honorable Lake County Board of Supervisors
From: Cannabis Tax Ad Hoc Committee
Subject: Review of and Recommendation for Cannabis Tax Usage & Expenditure Policies & Procedures
Executive Summary:
Your Board previously directed the Cannabis Tax Ad Hoc Committee (Committee) to meet and review the Cannabis Tax Usage & Expenditure Policies & Procedures (Policy). The committee has reviewed the current funding allocations and has set forth the following recommendations in the form of a revised Cannabis Tax Policy that is attached for your consideration. The substantive funding changes are highlighted below:
1) Board of Supervisors Discretionary Fund - The prior allocation of 7.5% would be adjusted to a $500,000 fixed allocation. The $500,000 allocation would be split evenly across the 5 districts. This resulting $100,000 would be available to each Supervisor to spend wherever the greatest need exists within their district. The spending does not need to meet the criteria defined in any of the discussed categories.
An additional $500,000 would be allocated in in FY 2021-2022, as these funds were not disbursed in the prior year.
2) Cannabis Revenue Stabilization Fund - The prior allocation of 15%, up to a maximum of $2 million, has been adjusted to reflect the allocation that would be necessary to achieve a balance equal to at least one year of expected ongoing expense. This provides for smoothing of potential revenue shortfalls and allows the aforementioned services to be fully funded without the need for cuts to services. These funds will also be available to satisfy remaining obligations from CannGrants awarded in the prior fiscal year that have not yet been completed.
Allocations to the Stabilization Fund would cease so long as a balance, at a minimum, approximating ongoing expenses is achieved.
3) Capital Improvement & Deferred Maintenance Fund - As per your Board's direction during recommended budget hearings...
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