TUT Paying Off, With An Anomaly – May 10, 2011

Tuesday, May 10, 2011

Kevin L. Hoover

Eye Editor

CITY HALL – The City of Arcata’s 3/4 cent Transactions & Use Tax (TUT) brought in more than $429,000 in the fourth quarter of 2010. For the year, the TUT, also known as Measure G for the ballot measure which voters approved, garnered some $1,647,511 to be used for Public Works street repairs and Arcata Police for beefed-up staffing.

At last week’s meeting of the TUT Oversight Committee, Deputy Public Works Director Morgan Kessler presented a memo outlining the department’s TUT-funded projects for the year. With $400,000 in carry-over funds and $1 million in anticipated TUT revenue, there are two main paving projects planned for summer, 2011.

The 2011 Pavement Management Project will see several streets restored, including G and H between 11th and Ninth; 11th between F and G; 10th between G & H; I between Seventh & 10th; Eighth, Ninth and 10th between I and J; J between Eighth and Ninth; 16th between F and L; 17th between Alliance Road and Q; Janes between Zehndner and Bay School; and parts of the Bayside  Cutoff.

The other major road project will include resurfacing of Old Arcata Road and Buttermilk Lane.

Some $75,000 will be spent on matching funds for a grant which will provide more traffic calming, sidewalks and bike lanes.

The Arcata Police Department didn’t submit a report. Its well-publicized staffing increases have incuded downtown and Valley West officers, plus park rangers and a full complement of sworn officers.

Funny figures

Since Arcata already gets one percent of the nine percent of retail sales tax charged in town, the 3/4 cent TUT tax should consitiute roughly 75 percent of the total 1.75 cent sales tax take.

Some variations are understandable. In the Autos and Transportation category, for example, TUT revenues are some 215.2 percent of the other one percent share of sales tax, because Arcata has no auto dealerships. The TUT tax is levied against Arcata residents who purchase cars elsewhere, hiking the TUT portion of the proceeds well beyond the one percent collected within Arcata on smaller auto-related purchases such as parts.

But in one key category, food and drugs, the TUT comes in low at 63.4 percent. Finance Director Janet Luzzi  has a theory about that.

“I think it has to do with the [cannabis] dispensaries,” Luzzi said. “I have frustrations, because I don’t think they all are reporting properly.”

Luzzi has asked the City’s tax consultant, Hinderliter de Llamas and Associates, for an explanation of the anomaly.


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3 Responses to “TUT Paying Off, With An Anomaly – May 10, 2011”

  1. ““I think it has to do with the [cannabis] dispensaries,” Luzzi said. “I have frustrations, because I don’t think they all are reporting properly.””

    I would argue that the revenue at the clinics is down because the quality of their product is sub par. Ever since the city council removed the ability of the clinics to get medicine from smaller producers (Patients with extra cannabis, the quality of the cannabis has gone steadily down hill. Why would anyone buy cannabis at one of the local clinics for $280.00 an ounce when the going ” street” price is only $150.00 an ounce for much higher quality.

    The feds have indicated that they will not tolerate centralized production of medical cannabis, as occurs at HPRC, HMS, and THC.

    “The Department of Justice previously indicated that it would not focus its limited resources on doctors and their sick patients who prescribe and use marijuana if such use was permitted by state law,” Gov. Chafee correctly pointed out. “This position was interpreted by some states as giving them latitude to authorize medical marijuana cultivation and distribution programs.”

    “Friday’s letter makes it clear DOJ will now pursue certain commercial cultivation and distribution of medical marijuana, even if such cultivation and distribution is permitted by state law,” Chafee said (emphasis added).

    “Compassion centers, their owners, landlords, financiers and other operations’ ‘facilitators’ are identified as potential targets of federal law enforcement activities,” Gov. Chafee said.

    “Facilitators”, according to the feds include anyone in local government that license the mass cultivation of cannabis by “dispensaries.”

    It might be time to change the “centralized” production model that was favored by the city council, but never liked by the general population of patients.


  2. http://www.tokeofthetown.com/2011/04/new_tactic_us_attorneys_threaten_medical_marijuana.php#more

    “U.S. Attorneys Mike Ormsby (Eastern Washington) and Jenny Durkan (Western Washington) noted U.S. Attorney Haag’s earlier threats in Northern California, and went on to threaten that state employees who license the dispensaries might be arrested. ”

    “​And now, the U.S. Attorney for Colorado, John Walsh, has horned in on the legislative process in that state, warning lawmakers that pending legislation adjusting state rules for medical marijuana would conflict with federal law and “could lead to federal prosecutions,” reports Felisa Cardona at The Denver Post.”


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