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How the Cannabis Industry is Saving Small Towns Across America

cannabis small towns
Written by Alexandra Hicks

In states like California, Colorado, and Washington, where cannabis cultivation is now legal, the industry is saving many small locales that are on the verge of becoming ghost towns.

After decades of strict prohibition, cannabis now proving to be quite a commodity, rescuing these small towns from bankruptcy and multi-million dollar deficits. Abandoned buildings, dilapidated streets and parks, and overall feelings of financial despair are a thing of past for these areas that are cashing in the green rush.

One such area is the hot, dusty town of Desert Hot Springs, CA, the first city in Southern California to legalize large-scale cannabis cultivation. Situated right off the I-10 freeway near the eastern edge of Joshua Tree National Park, Desert Hot Springs has potential, but unfortunately lacks the upscale resort reputation of neighboring areas, like Palm Springs. The median household income is just over $33,000 annually, significantly less than the state average of $71,000.

Following a fiscal emergency, the city council voted to legalize medical cannabis dispensaries and cultivation. The result is a ripple effect economic benefits: construction and utility jobs, security jobs, positions for project managers (to resolve infrastructure issues for growers), a real estate boom, and of course employees directly involved in the dispensaries and cultivation. Desert Hot Springs is now home to the largest solar-powered cannabis growing and processing facility in the world.

But DHS isn’t the only California desert town expecting to see a surge of green in their barren landscapes. City Councilman John “Bug” Woodard used the cannabis industry to dig the town of Adelanto (San Bernardino County) out of their 2.6 million dollar debt. Cathedral City and the city of Coachella have also started to designate certain areas for cannabis growing. So far, these desert towns have received a total of around 100 applications for growers and dispensaries 

Further north up the West Coast is the town of Raymond, WA. A once thriving epicenter of timber mills was there, but that all changed in recent years when most of the world went digital and the timber industry came to a screeching halt. Raymond became known as an “out of the way” town with dismal employment opportunities.

The decision to legalize cannabis cultivation came fairly easily to lawmakers, and within one year Pacific County generated $5 million in revenue from the industry. Cannabis profits have well-surpassed income from any other industry in the area, including cattle ranching. According to Raymond’s job growth is expected to be at 34.17% in the next ten years.

The revitalizing effects of the green rush are far reaching, from the west coast out to colorful Colorado. The towns of Trinidad and DeBuque were all but withering away after the collapse of their local fuel and mining industries when they turned to the cannabis industry to fill the financial void. In all, the state of Colorado ended the year quite nicely with nearly $996 million in revenue from recreational cannabis sales. A good portion of that money is intended to go towards schools and citywide renovations

Challenges Faced

One thing everyone can agree on is that the revenue and benefits coming from the cannabis industry are bountiful. But that doesn’t mean there aren’t some challenges on the horizon. With the recent legalization of the industry in some states, two of the main obstacles to overcome are tax related issues and problems with infrastructure.

Like with all large-scale business, there is the potential for greed and corruption to permeate, This often comes in the form of frequently increasing taxes. Many growers and dispensary owners are already dealing with high taxes and minimal tax breaks compared to other businesses.

Thanks to Section 280E of the tax code, businesses that are involved in some way with prohibited controlled substances are not entitled to the same tax breaks as other businesses. Some growers and dispensary owners have been subjected to tax rates of up to 70 percent. That’s more than double the standard rate of 30 percent that other businesses pay.

Another immediate issue is the need for infrastructure. Luckily, that’s something that will most likely be resolved must faster than corporate greed. However, building large-scale structures with all the resources needed to grow cannabis is no easy task. They would need to take many things into consideration including climate control, conserving water, and conserving energy. This can be an especially daunting task in the harsh desert landscape of California, but it’s not exactly cheap to have a climate controlled environment in places where it gets cold either, like Washington and Colorado.

Not only that, but getting utilities to some of these places could be a challenge in and of itself. These are small towns with small electrical grids, definitely not large enough to handle the energy demands of multiple, large-scale grow operations.

According to Robert Laffoon-Villegas, spokesman for Southern California Edison, said: “the utility expects that some growers’ power needs could be so large that it would be like adding a small city to the system.” To be able to provide the necessary power will most likely require more energy facilities to be built.

There will always be challenges to overcome, that’s true to be said about anything in life. But the cannabis industry has so much potential and room to develop. Plus, numbers don’t lie, cannabis means money! And there are a lot of small towns throughout the United States that could benefit greatly from the financial surplus that the cannabis industry could provide for them.

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1 Comment

  • Desert Hot Springs was the first in all of California to legalize large-scale cannabis cultivation, not just in Southern California.

About the author

Alexandra Hicks

Managing editor at Cannadelics and U.S based journalist, helping spread the word about the many benefits of using cannabis and psychedelics.