Craig City Council seeks more facts upon which to base marijuana sales tax decision |

Craig City Council seeks more facts upon which to base marijuana sales tax decision

Ordinance as written would have taxed sales at 2% to fund museum, library

Ellen Fike
For the Craig Press
The City of Craig's Council Chambers.
Craig Press File

After much discussion, including at previous Council meetings, the Craig City Council decided to seek more information before deciding whether to approve an additional sales tax for retail marijuana.

The council twice voted down — first in an amended form, then in its original state — the first reading of an ordinance that would have implemented a 2% sales tax on marijuana sales in the city.

The body agreed to table the discussion until after it could further examine its current increase from marijuana sales.

Should the ordinance eventually fail, it would mean that the Museum of Northwest Colorado and the Craig library would have to make do without additional funding from the taxes.

As written, the ordinance would have directed funds gained through the tax toward the museum and library.

That original ordinance was motioned and seconded but failed, even after an amended ordinance that would have taken advantage of the full 4% increase, which the Council has been given privilege for by voters, also failed.

“I say we collect the money that the community already gave us permission to collect while we can and complete as many projects [as possible],” Councilman Chris Nichols said. “What do you want your community to look like? Somebody has to pay for services. They don’t just show up out of thin air and sustain themselves.”

Earlier this year, City Manager Peter Brixius told the council that the state and local taxes being generated from the three dispensaries in town would soon total over $220,000 a year, exceeding the city’s targets.

A 1 percentage point increase in the sales tax would generate an estimated $40,000 per year, with the full 4 percentage points bringing in as much as $160,000 per year.

However, some council members argued at various meetings, including Tuesday’s, that the taxes would squeeze not only visitors to Craig, but its residents, which were estimated to make up about half of the local dispensaries’ business.

There were also concerns about how long the tax would be implemented and what the council and city would have to do in five years’ time, when the tax would likely have to be increased again.

Previously, Councilman Paul James, who manages one of the dispensaries in town noted that the state will also continue to increase taxes on marijuana when it needs money, affecting local customers even more. James was a vocal opponent of the ordinance in Tuesday’s meeting, and offered a motion to table indefinitely the conversation, though that, too, was ultimately voted down.

The Council will learn more about the under-projected increase and its available funding sources in a workshop before the June 22 Council meeting.

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