BUSINESS

For more Business News visit QueenCreekTribune.com

QueenCreekTribune.com | @QCTribune @QCTribune

Marijuana sales steadily increasing in Arizona

BY RYAN KNAPPENBERGER

Cronkite News

Sales of marijuana in Arizona soared to $1.6 billion in 2021, just one year after recreational pot was legalized in the state, making Arizona second only to California for retail sales that year, according to an industry research group.

But while retail sales of cannabis are strong, the crop is far from being added to the traditional “5 C’s” of Arizona’s economy, experts say, as production still trails far behind other states.

They say cannabis could become a strong part of the state’s economy in the next few years, but the industry will first have to overcome barriers to growth nationwide that include limited trade and restrictions on financing for a crop that is still illegal on the federal level.

“We don’t see SWAT teams busting in the doors of dispensaries,” said Aaron Smith, CEO of the National Cannabis Industry Association. “But we do have problems with not being able to take tax deductions like a normal industry, or being able to have interstate commerce, which really creates a barrier to entry for a lot of folks.”

Marijuana sales brought in $221.3 million in taxes in 2021, according to the Arizona Department of Revenue, and sales in 2022 were on pace to eclipse that number, with $196.4 million in taxes in Arizona has seen a decline in the marijuana market share involving flower and an increase in the popularity of vape pens and pre-rolls,according to the latest available market data.

(headset.com)

the first nine months of the year. That’s an average of just under $22 million in excise taxes a month for 2022.

Cultivation and production of cannabis as a crop, however, are not about to rival the 5 C’s: cattle, cotton, copper, citrus and climate. Alexis Villacis Aveiga, an assistant professor at the Morrison School of Agribusiness at Arizona State University, said the state would need to see a much larger expansion of agricultural production.

But Arizona’s climate makes it difficult to grow cannabis.

“For example, we have 35,000 square feet of indoors cannabis and hemp,” Aveiga said. “In California there are over 4 million square feet, Colorado has over 2 million and Kentucky has around 200,000.”

Dave DeWalt, the Arizona statistician for the U.S. Department of Agriculture, said in an email that the state had about 129,000 acres of cotton in production in 2021, worth about $156 million, and that cattle brought in $754 million that year. There were 10,031 acres of citrus in the state in 2017, the most recent year for which USDA has data available.

Acreage for cannabis production was not readily available, but the Arizona Department of Agriculture measures the production of hemp – a type of cannabis plant that contains 0.3% or less of tetrahydrocannabinol, or THC, the psychoactive com-

ponent of the plant that gives users a high. Hemp cannot be used to get high, but can be used to create things like rope, paper, paint, beer, medicine and more. The department said Arizona had 155.5 acres of industrial hemp growing in fields at the end of 2021, and 11,558 square feet planted indoors. Aveiga said current state regulations make hemp less attractive as a crop, since farmers can only sell their harvest if it is below the 0.3% limit for THC. Otherwise, it counts as marijuana, which requires a separate license to grow and sell. Smith, of the NCIA, said it’s not just farmers: Businesses trying to sell medical and recreational marijuana face legal hurdles that other businesses don’t. He said regulations for cannabis make it difficult for small businesses to deduct expenses and find banks to work with. That means some operators cannot take credit cards for purchases and in some cases cannot place cash in checking accounts. Despite all the current hurdles, Smith said Arizona has been a pioneering purple state in terms of cannabis regulation and has shown just how popular legalization can be. “Cannabis is used across demographics, boomers and millennials and Gen Z, people over 21 are using responsibly and we’re glad to see that,” Smith said. “Arizona law is by and large working well.” 

U-Haul gets initial OK for Queen Creek storage site

TRIBUNE NEWS STAFF

The Queen Creek Planning and Zoning Commission has given initial approval for a parcel of land at the just east of Ocotillo and Crismon roads, adjacent to the Union Pacific Railroad tracks, for 1,073-unit U-Haul storage and rental facility.

The land is already zoned for such an operation, but had to go through the public hearing process because of what the company wants to do on that corner, which goes beyond a typical storage facility.

“They were required to obtain a conditional use permit because they were proposing the outdoor storage of their vehicles,” said erik swanson, planning manager for the town of Queen Creek.

Although the commission is not involved in doing any sort of needs analysis for this or any other site in town, Swanson said, there seems a clear need for this type of facility.

“With the town’s explosion in population, U-Haul obviously thinks there is a need for it,” Swanson said, “but it’s not something where we go out and say ‘hey, there is a real need for this let’s go try to cater to these users.’”

Swanson said from a planning and land use standpoint, which is his expertise, this corner makes sense given what is around it.

“I think it’s a beneficial use given the proximity to all the residential around it, it seems to make sense,” Swanson said. “There’s also outdoor storage out there already to the East and so it kind of fits in with the surrounding context.”

The land use permit will go before Town Council in the new year for consideration and possible approval.

U-Haul was founded in Washington State in 1945 and is now headquartered here in the Valley. Its latest numbers show that the company employs 19,500 people, and in 2020 generated revenue of more than $54-billion.

While it sells boxes and other moving supplies and rents storage units to the public, it is perhaps best known for its familiar orange and white trucks and trailers with the black U-Haul logo emblazoned on the side. 