California Uses Cannabis Tax Revenue to Grant $35.5 Million to Community Organizations

The California Governor’s Office of Business and Economic Development (also referred to as GO-Biz) announced on June 1 that it would be granting $35.5 million worth of cannabis tax revenue to community efforts.

The funds come from the California Community Reinvestment Grant program, which will be directed to organizations that help with job placement, mental health treatment, substance use disorder treatment, system navigation services, legal services to address barriers to reentry, and linkages to medical care.

“We’re proud to announce 78 grants totaling $35.5M in awards through the California Community Reinvestment Grants (CalCRG) program. These grants will help serve communities across CA that have been disproportionately impacted by the War on Drugs,” the organization wrote on Twitter.

In a press release, GO-Biz shared the need to use cannabis tax funds for specific communities that are in need of aid. “Harsh federal and state drug policies enacted during that period led to the mass incarceration of people of color, decreased access to social services, loss of educational attainment due to diminished federal financial aid eligibility, prohibitions on the use of public housing and other public assistance, and the separation of families,” the release states.

Furthermore, GO-Biz Director and Senior Adviser to Gov. Gavin Newsom Dee Dee Myers shared a statement regarding the continued success of the program. “Now in its fourth year, the California Community Reinvestments Grants program continues to be an important tool for communities that still face systemic restrictions and barriers to opportunity and equity,” said Myers. “This latest round of awards will support the economic justice and well-being of communities across our state that have been disproportionately impacted by the War on Drugs.”

A total of 78 organizations were chosen across California, located in the counties of Alameda, San Francisco, Los Angeles, Riverside, San Bernardino, San Diego, and more.

Among the recipients receiving the highest amount of $900,000 includes JobTrain, GRID Alternatives Greater Los Angeles, Inc., Community Partners as a fiscal sponsor of Los Angeles Regional Reentry Partnership, and Recovery Café San Jose. Most others, such as the Legal Aid Foundation of Los Angeles, Inland Valley Drug and Alcohol Recovery Services, Kitchens for Good, Inc., will be receiving $450,000.

In 2021, the program sent out 58 grants for a total of $29.1 million and in 2020, $30 million was earmarked for a variety of cities and counties.

Since California legalized adult-use cannabis in 2018, the state has collected $3.76 billion in total tax revenue, according to a press release posted on May 26 by the California Department of Tax and Fee Administration. This includes $1.91 billion from cannabis excise taxes, $467.75 million from cultivation taxes and $1.38 billion from sales taxes.

Recently, Gov. Newsom’s budget proposal set aside $150 million to reduce cannabis taxes. He said in a press statement that the temporary reduction will help aid small cannabis business owners, and also curb illegal sales. “This is [the] beginning of a process from my humble perspective, in terms of my thinking,” Newsom said. “This will be a multi-year process to get that black market, get it on the retreat—not the ascendancy—and to get the retail and responsible adult-use market on steady ground.”

Earlier this year, California announced that it would be granting nearly $100 million to local governments and jurisdictions that would help bolster their cannabis programs, and make them more efficient. The Department of Cannabis Control Director Nicole Elliot explained that this grant money would help communities with specific needs. “Significant funding is being directed to process improvements and environmental assessments, both of which will help the state and local governments achieve short- and long-term goals,” Elliot said. The most highest amount was awarded to the city of Los Angeles for $22,312,360, Humboldt County with $18,635,137, and Mendocino County with $17,586,406.62.