City collects big bucks from marijuana retail shops

The city’s four marijuana dispensaries continue to be a cash cow. The four outlets paid over $200,000 last year in taxes and fees, according to the state.

By Charles Sercombe
Hamtramck’s marijuana dispensaries continue to be a money pot for the city.
According to the Michigan Department of Treasury, the four recreational retail shops contributed $207,364 to the city’s coffers from taxes and fees in 2022.
In all, over $59 million was distributed by the state to 224 cities and counties. That breaks down to $51,800 that each retail outlet paid, according to the state.
On top of that, $69.4 million was sent to the School Aid Fund for K-12 education and another $69.4 million to the Michigan Transportation Fund.
More than $1.8 billion in marijuana sales was reported last year, although there was no revenue breakdown for Hamtramck’s dispensaries individually.
While the taxes and fees Hamtramck collects are impressive, other nearby cities received even more, in some cases considerably so:
Hazel Park issued eight licenses and collected over $414,000.
Ferndale has five licenses, and it earned over $259,000.
Ann Arbor has 27 licenses, and it earned over $1.4 million.
Bay City has 13 licenses, and it earned over $674,000.
Hamtramck’s revenue is not earmarked for anything specific, but rather is put into the general budget.
Despite the revenue produced by the dispensaries, there are some in town who would like to close them down, or not allow the licenses to be transferred to new owners if any plan to sell their business.
They claim the dispensaries lead to more crime, although daily police incident reports do not bear this out.
While the marijuana revenue stream looks impressive, the city’s parking meters are doing even better.
According to City Manager Max Garbarino, the city’s share of meter revenue from August 2021 to December 2022 was over $488,000. That sum represents both money from the meters and tickets issued for meter violations.
The parking meter company received a similar amount in a deal with the city that splits revenue 50-50.
There are some expenses the city has to pay out of its share.
Garbarino said that he expects revenue to increase in the coming years.
“We’re not losing from the system, but we’re not doing as good as we thought,” he said.
There has been criticism over the meters. A number of business owners say the meters have led to a loss of customers. Also, people have complained about getting tickets even though they paid for parking.
If some critics had it their way, the meters would be removed. However, the city has a contract with the company that installed the meters.
Breaking that contract, Garbarino said, “would be devastating” financially to the city.
He said that if the meters are removed, the city would be obligated to pay the company lost revenue for the remainder of its contract.
Posted March 10, 2023