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Cannabis tax may help Santa Barbara County handle COVID-19 sales and bed tax losses

Cannabis may help Santa Barbara County budget
Biltmore hotel
John Palminteri
The Four Seasons Biltmore Hotel is shut down during the coronavirus crisis and bed taxes overall will be dropping according to a county report. (Photo: John Palminteri)
Economic graph
Hospitality and leisure jobs are expected to be the hardest hit during the coronavirus crisis.

SANTA BARBARA COUNTY, Calif. - With its budget projects expected to be reworked in the next two months, Santa Barbara County says it may be able to hold off some of the harsh impacts of Covid-19 economic downturn with cannabis tax funds.

The county says for now no one really knows how the economy will be hit in exact dollars, or when it will start climbing back.

That assessment is grim, but getting some timeline going will be a critical path for decision makers to use to figure out solutions.

Economic analysts say the economy could be coming back sooner than fall, which was one recent prediction but not fully recovered until 2022.

A budget hearing before the Santa Barbara County Board of Supervisors went through the projections prior to Covid-19 and some of the expected issues ahead.

County Executive Officer Mona Miyasato called the current situation, "economic paralysis."

As for a timeline for the economy to return, she said, "the truth is no one really knows. There are many unknowns related to it and a wide range of potential outcomes"

The report showed the cannabis industry remains strong and it will provide vital taxes, other counties may not have access to. Santa Barbara has one of the largest number of cannabis businesses in the state. It's mainly in the Carpinteria Valley, near Buellton and Los Alamos.

First District Supervisor Das Williams who has a district with many licensed cannabis growers said, "if staff is proposing to use marijuana tax revenue to try to maintain our budgets, I support that goal. I just think it should be in this case across the general fund and not leave out somebody." He specifically mentioned libraries.

Fifth District Supervisor Steve Lavagnino said, "obviously we are in a crazy year, and we need to do something different. I really support cannabis tax because we aren't sure how long it will last."

Department heads are expected to look at areas where cuts, or hiring freezes could take place if the situation calls for it. No sweeping announcements have been made, and service levels are in the same range as pre-Covid-19. The message is already going around, however, to prepared for mid-year service level reductions.

More than one county  leader is using the phrase "uncertain future."

The county is also planning to use "strategic reserves and contingency" funding to ease the impact of the economic challenges.

Along the way there will be requests for state and federal assistance, but officials say, there will be a pool of funds many if not all California counties will apply in to.

Article Topic Follows: Local Politics

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John Palminteri

John Palminteri is senior reporter for KEYT News Channel 3-12. To learn more about John, click here.


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