MOLINE, Ill. — As Moline's second cannabis dispensary, Revolution Dispensary, opened its doors on Friday, the city announced it had missed out on hundreds of thousands of dollars in tax revenue from cannabis sales.
"It's the kind of situation my family would characterize as just a damn shame," Moline Mayor Sangeetha Rayapati said.
The City of Moline held a press conference to announce that a significant oversight had occurred, one that would cost the city somewhere in the range of $300,000 to $500,000.
"This error was discovered recently when staff sought the distribution of revenue from the last several months from the State of Illinois," Rayapati said.
Rayapati was not in office in 2020 when the Moline City Council passed a dispensary tax ordinance but failed to file it with the state. The city would've started collecting a 3% tax on cannabis sales when the first dispensary opened in July.
"There was a period of chaos at the City of Moline in 2020. You cannot have interims and missing directors because it leads to chaos and oversight," Rayapati said. "Due to state deadlines, we'll not be able to collect cannabis tax revenue from the state until July 2024, effectively delaying the expansion of our revenue streams by approximately one year.
The ordinance has now been filed, but not without a massive pot of revenue lost.
Rayapati said the money was going to be used for economic opportunities for folks in need but the lost revenue will not affect the city's everyday budget.
"Due to conservative budgeting and following a philosophy of use of the cannabis tax as opportunity revenue, in other words, used to expand services rather than pay for essential services, this error will not significantly impact our 2024 budget," Rayapati said.
The City of Moline is currently looking into whether or not the state can backpay the lost revenue.
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