CA: Cannabis – Illegal In Yucca Valley, Big Business In Low Desert

Photo Credit: Nanette Gonzalez

At the start of the new year, recreational marijuana became legal in the state of California, marking a shift in the California marijuana industry and the state’s overall economy.

With the passing of Proposition 64, marijuana market data firm BDS Analytics, estimated that $1.5 billion in additional revenue could flood into California this fiscal year.

Marijuana sales are illegal in the Morongo Basin, but in the nearby Riverside County desert cities, recreational marijuana storefronts and farms are already emerging. Cannabis businesses from across the state gathered for the Coachella Valley Cannabis Alliance Network Convention this weekend.

“This convention was an opportunity to bring all the businesses and politicians together,” said Jason Elsasser, founder and president of CVCAN. “Coachella Valley is positioned as the supply hub of California and this event is catered to these businesses.”

The-two day convention was open to local cultivators, investors and anyone else interested in the growing cannabis industry. Exhibitors included dispensaries, both medical and recreational, marijuana storage companies and marijuana farms. Also featured were local lobbyists and legislators.

Lobbyist Michael Correia, who works for the National Cannabis Industry Association, spoke in one of the panels about the problems surrounding marijuana businesses and federal taxes. Since marijuana is illegal under federal law, businesses cannot claim themselves as such on their taxes, costing them massive amounts of money in business write-offs, he said.

Businesses also cannot open business bank accounts, making it difficult to keep track of how much money they bring in for their state taxes. The lack of official information can make it difficult to know whether they are reporting all of their proceeds, said Correia.

The lobbyist said legislators are ready to tackle some of those problems.

“The support is there,” Correia said. “Members of Congress are starting to get it and understand how it is hurting businesses.”

Dispensaries and related companies are drawing in business from low desert locals as well as Morongo Basin residents.

Brent Buhrman, owner of a company that rents out cultivation space, has seen an increase in his business since legalization.

“Our local farm was recently built out and completed,” said Buhrman. “The need, however, keeps growing so we’re currently here looking for tenants for our new location.”

Other vendors included Juan Eufracio with his company, Boveda. Boveda sells two-way humidity control packets specially designed to keep marijuana from drying out or growing mold.

While these businesses are sprouting up in the low desert, the Morongo Basin does not allow dispensaries, shops or deliveries.

Yucca Valley citizens will be voting June 6 on Measure L, which would allow cultivation and manufacturing businesses to open in the city’s industrial zones.

CVCAN founder Elsasser, was born and raised in Yucca Valley, is part of the committee that brought Measure L to the ballot. While the state can license marijuana companies, they also need a local license to open a business and that is stopping them from opening up within the Hi-Desert.

“These new businesses could revitalize economic development and workforce development,” Elsasser said.