If Westminster is facing a COVID-19 bred financial crisis, City Councilors said they’re not sure that allowing cannabis sales is the right answer.
Westminster staff brought proposals to the council’s Aug. 17 study session that would have asked voters if Westminster should allow retail cannabis sales — complete with a ballot question and polling data. That could give the city additional revenue to help alleviate the financial hit that could expand to $32 million, due to COVID-19 and local business closures.
But councilors said the city would have to find some other way, noting that the proposal seemed rushed.
“I remember when we were looking at allowing chickens and bees, that took ages for our city to have the capacity to look at best practices in other communities and come up with a proposal,” Councilor Anita Seitz said.
Larry Dorr, Westminster’s Chief Financial Officer, said he expects to give the city an updated review of Westminster’s financial situation at the Aug. 24 meeting. Back in April, Dorr estimated that reduced sales tax and other revenues during the COVID-19 closings could amount to a $30 million reduction to Westminster’s General Fund. Westminster does have $32 million in reserves it can tap into, plus another $25 million in a fund future capital projects that can be postponed.
“It’s a range of estimated based on multiple variables going into potential forecasts that are changing all the time,” Dorr said.
Westminster staff researched two potential issues for November’s ballot, increasing the city’s sales taxes and allowing cannabis sales and then taxing them. The city brought in firm New Bridge Strategy to poll likely Westminster voters to see how the popular the new revenues would be.
Lori Weigel, principal for the research firm, said they contacted 400 likely-Westminster voters between Aug. 6 and 12 by telephone, both mobile phones and landlines.
The poll found those voters narrowly supported and increased sales tax, but not by enough to overcome undecided voters and potential shifts in opinions.
“This is not at the level where we would say ‘Great, go for it, guys. People are ready for a sales tax increase,’“ Weigel said.
Voters were much more supportive of a tax on cannabis — 57 percent said they supported that, compared to 24 percent who were opposed an 19 percent who were unsure — even though less than a third knew that cannabis sales are not allowed in Westminster. When informed that sales are not currently allowed, 61 percent said they’d support changing that to allow cannabis sales.
“We know that voters are somewhat confused about whether or not marijuana is sold in the city,” Weigel said. “That said, there is a fairly solid majority that supports sales.”
Dorr said councilors needed to decide if they wanted to pursue a ballot question before the Aug. 24 deadline.
“I realize that this is a very tight timeline and is not ideal,” Dorr said. “In fact, it creates a very difficult situation and difficult choices for sure. On one hand, we want to better understand the financial gap we are facing and lost revenue. On the other hand, there is this short window of time where we can let the Westminster voters have a say in how this loss might be mitigated.”
Councilors at the meeting were uniformly against making the change now.
“I think we have a lot more work to do internally before we put one of these ballot questions out,” Councilor David DeMott said.
Councilor Lindsey Smith noted that staff had argued against asking Westminster voters if they’d support creating City Council wards or voting districts, saying it would be an unnecessary expense during COVID.
“If we can get the wards and districts on the ballot, I am more than happy to say yes to this,” Smith said. “It does not make sense to one and not the other. So, this is great information but it’s something I’d be willing to put on the ballot in 2021.”
Councilor Seitz had questions about regulating cannabis sales and how the city would decide where the shops would be allowed. City Attorney Dave Frankel said those could be settled after voters approved if voters approved the sales, but she said she’d like answer them first.
“It’s not really the ballot measure for me but the expense of doing it well and researching how we would divvy up our community to make it fair to all the areas,” she said. “If you are going to make a massive change to our charter, we want to do it well and hire the appropriate people and experts to do it.”