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The local cannabis market fell slightly this quarter, but data presented to the Las Cruces City Council this week suggested that local sales of cannabis remain high two years after the market opened in 2022.
That information was among a cluster of data points given to the city council on Oct. 28 during a quarterly presentation on the city’s economic outlook.
“We expect economic growth to continue,” said city economist Monica Torres,“but at a more moderate pace as compared to recent years.”
Torres said that the decline in cannabis sales from July 1 to Aug. 31 stemmed from a decline in medical cannabis sales. Data from the state Taxation and Revenue Department showed that medical sales, which comprise about 30 percent of all sales, fell by about 15 percent.
However, the same data showed that the decline was a minor departure from past quarters.
Since 2022, cannabis has been available for purchase by adults for non-medical use through a state-regulated framework, from licensed dispensaries, with customers charged a special excise tax. Medical cannabis sales are tax-free, yet enrollment in the state’s medical cannabis program has declined since the adult-use marketplace opened.
Torres reported that Las Cruces had collected about $211,000 from the cannabis excise tax. The city has not yet decided on a use for this revenue.
While the cannabis market contracted, Torres said that gross receipts taxes increased by about 1.8 percent (about $500,000), continuing a trend of growing GRT following a dip in 2020, the first year of the COVID-19 pandemic which saw severe restrictions on most businesses and social gatherings.
GRT is a critical source of revenue for nearly all municipalities, and Las Cruces is no exception. An increase in local GRT is on the ballot before the city’s voters on Nov. 5.
In the community, unemployment is about 5.3 percent, an increase from last year's 4.3 percent. Home listings, meanwhile, increased by about 1 percent to about $353,000. The city also saw 148 new businesses register during the quarter, city staff reported.
