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Date: 9/5/2023
NORTHAMPTON — A fourth quarter financial report for fiscal year 2023 shows that Northampton reached its goals in all of its general fund categories except cannabis revenue.
“We did end the year of the General Fund revenues on track,” Northampton Finance Director Charlene Nardi said during the City Council meeting in mid-August. “We have seen a rebound in almost all of the revenues that were impacted by COVID.”
The motor vehicle excise, hotel/motels and meals sales all returned to pre-coronavirus pandemic standards, according to the financial document provided by the city.
Specifically, the city received $970,975 in hotel tax revenue in FY23, a stark increase from $690,750 from the previous year. Northampton also received $779,700 in meal tax revenue, an increase from FY22’s total, which was a little over $692,000.
The city is however continuing to see a decrease in the cannabis tax revenue. According to the financial documents, the city only saw $846,153 in cannabis tax revenue after receiving $1.15 million in FY22. The revenue back in 2020 was $1.6 million.
“We are down 27% from last year,” Nardi said. “I don’t know if we’ve hit the bottom yet for our market share…my guess is no.”
Due to the tax revenue decrease, Nardi said she has dropped the revenue projection for FY24, which officially began on July 1.
In a 6-3 vote, the City Council voted to cap dispensaries at 12 in Northampton back in January. Currently, the city features 11 dispensaries, after the 12th, The Source, shuttered in December.
In Reminder Publishing’s IMPACT story on cannabis, Mayor Gina-Louise Sciarra said that — despite a cooling market — the cannabis industry has contributed to filling vacant storefronts, transformed rundown buildings, increased foot traffic, contributed signficant tax reveue for the city for various public services and has created a substantial amount of jobs.
“Northampton went from having a brief corner on the market to being a city with quality cannabis retailers worth visiting alongside the other wonderful businesses and attractions we have to offer,” Sciarra said.
The city’s cap has had no known impacts on the city so far, according to Sciarra, and there has been minor interest from potential new cannabis businesses over the past couple years.
Nardi said the cannabis tax revenue discussion will continue at the next finance committee meeting.
FY23 ended on June 30.