On April 1, 2022, the state of New Mexico began recreational cannabis sales.
The Cannabis Control Division reports that between April 1 and the end of February 2023, New Mexico had $268.3 million in recreational sales in the first 11 months of legalization.
While Albuquerque has the highest amount of adult-use sales with $86.3 million, Rio Rancho checks in at No. 7 with $8.3 million in adult-use sales. Rio Rancho is the only city in the top 10 with more medical sales ($8.6 million) than recreational use sales.
The combined medical and adult use sales of just over $17 million place Rio Rancho sixth in New Mexico. The CCD lists six dispensaries in Rio Rancho city limits.
Questions sent to Rio Rancho Mayor Gregg Hull were answered by Deputy City Manager Peter Wells. Hull declined to comment because the impact of legalized recreational use of marijuana is still so new to the City of Vision.
“Since April 2022 through February 2023, municipal government has received from the State approximately $280,000 in associated tax revenue from recreational sales,” Wells wrote in an email. “To put that number into perspective, the current City Fiscal Year Budget has approximately $93.3 million in projected revenues for the General Fund.
“The cannabis revenue source goes into the City’s General Fund, which accounts for general government operations spanning police, fire/EMS, road maintenance, parks and recreation, libraries, etc.”
The Cannabis Regulation Act, which went into effect in June 2021, legalized adult-use cannabis in New Mexico.
The CRA established an excise tax of 12% of sales until July 1, 2025, which gradually rises to 18% beginning July 1, 2030. The rate is the same throughout the state. However, businesses must report by location so that localities can receive their share of the tax. About 30% of taxes collected will be shared back to the municipality or county where it was collected. Adult-use sales are taxed by both gross receipts and cannabis excise taxes while there is no cannabis sales tax for medical marijuana.
“The City does not have a full fiscal year (July 1 to June 30) of actual revenue,” Wells wrote. “Future fiscal year revenues could increase year-over-year as the current State law is scheduled to increase the excise tax applied to sales each year between 2025 to 2030.”
While medical sales are higher than recreational sales in Rio Rancho, the past five months may be an indicator that will soon change.
Adult-use sales have topped medical sales every month since October. Adult-use sales have been over $700,000 each of the past 11 months with a high of slightly more than $826,000 in December and a low of $715,000 in June. Monthly sales topped $800,000 for the second time in February.