Menominee will get boost through cannabis taxes

MENOMINEE — Menominee will receive $295,000 in state tax money by virtue of having five cannabis dispensaries open in 2023.

The Michigan Treasury Department announced last week that about $290 million is coming from state taxes on adult-use marijuana products. Out of that Marijuana Regulation Fund total, $101 million each is going to the School Aid Fund for K-12 education and to the Michigan Transportation Fund.

That leaves about $87 million to be distributed among local municipalities, which receive approximately $59,000 for each dispensary within its limits. For Menominee, that’s five dispensaries at $59,000 each for a total of roughly $295,000.

Menominee Mayor Casey Hoffman welcomed the badly needed funds, but he warned about being reliant on the funds in the future.

“Wisconsin is dragging their heels on legalizing, that only seeks to benefit Menominee in the short term,” he said. “We need to expand our tax base or when the marijuana dollars disappear we will be in serious trouble. This is a Band Aid on a broken leg.”

Exactly when those marijuana dollars disappear hinge on when and if Wisconsin legalizes cannabis.

“It’s important to note that our current financial situation is temporary,” Hoffman continued. “When the state of Wisconsin inevitably legalizes marijuana, the amount of dispensaries in the city of Menominee will be reduced precipitously, perhaps in half by greater.”

Wisconsin Democrats, including Gov. Tony Evers, are miles apart on getting highly restrictive medical marijuana legislation passed, much less recreational weed.

The state tax money certainly is needed in Menominee. Hoffman said over the last five years, the city’s average shortfall is about $250,000.

“This money goes a long way toward establishing business as usual in the city of Menominee,” he said.

A call to City Manager Brett Botbyl was not immediately returned, but he told Bay Cities Radio that the city’s budget deficit last year was greater than $500,000. “A lot of public perception and maybe a misnomer is that the city would have received millions of dollars, but as you can see, $295,000 while it is a good amount, it certainly is not going to save the city in any regards,” he told the radio station. He said the cannabis companies are making millions of dollars.

Hoffman said the state tax dollars can be used at the city’s discretion for legitimate government purposes. One of those areas is the Spies Public Library, something near to Hoffman’s heart as his mother, Cheryl, was the long-time library director.

“My mother spent a generation protecting the Spies Public Library and establishing a pipeline of donors to protect that library after her retirement,” he said. “The library is more than a place of learning for me; it is a home and a sanctuary for my family. It is an institution that we feel that we need to protect. This money will go a long way in ensuring the Spies Public Library stays in Menominee for a long while.”

Hoffman said in 2023, the Spies Public Library was the first department in the city’s history to have its general budget (of $250,000) reduced to zero dollars because of revenue shortfalls. The city eventually found $50,000 for the library with the remaining $200,000 coming from the library donation accounts.

The mayor said the Klar and Hunter families each bequeathed money to the library. He said those accounts each have a balance of more than $1 million.

“Those were given to the city for charitable purposes,” Hoffman said. “They have been misused to keep the lights on, to pay the heating bill, to pay the electrical bill and otherwise pay for operations.”

He said the money was specifically to be used for the library and parks and recreation departments.

“It’s time to use these funds in the way they were intended or the city of Menominee will never get another major bequest again,” he said.

Hoffman said he voted against bringing marijuana to the city, but he has had a change of heart.

“I have been convinced that we need the revenue in the short term if we are to run a successful city,” he said. “The medicine may be harsh, but the patient requires it to survive.”