Merkel: Local portion should increase
SPOKANE VALLEY – Councilman Al Merkel advocated for a greater share of cannabis tax revenue for Spokane Valley during the special 2025 legislative preparation session of the council meeting this Tuesday evening.
Under current law, only 5% of statewide cannabis tax revenue is distributed to cities and counties. Spokane Valley supports increasing the local portion to 20%.
“We join other communities in supporting a 20% increase in direct distribution to cities and counties,” Merkel announced. He clarified, stating, “We’re not seeking a formulaic change, but are asking for an increase in the portion that would otherwise go to the state general fund.”
“What we’re not looking for is an increase in taxation,” Merkel explained. “I think that the 40-odd% taxation that has already been provisioned is a sufficient amount, it’s just that that amount should be distributed more equitably.”
Merkel noted that while the city hosts two large cannabis producers generating over $100 million in revenue annually, it receives only a fraction of those taxes. He explained that those cannabis producers employ up to 1,000 people if both contracted and direct labor are counted.
“These businesses use our roads, are protected by our police, and contribute to our local economy,” Merkel said. “The city deserves a fairer share of the revenue.”
Briahna Murray, a state lobbyist hired by the city, confirmed the change would not increase taxes but would redirect more funds to local governments. Staff corroborated that The Association of Washington Cities and the Washington State Association of Counties are coming together to collectively ask for an increase in the amount of cannabis tax revenue that is dedicated to cities.
Mayor Pam Haley asked for clarification on the procurement of cannabis tax revenue, wondering if the taxes are collected on the actual manufacture and growth, or if they were just collected from retail outlets.
Murray answered that it is only collected from retail sales.
Deputy City Manager Erik Lamb said that the city received “something like $180,000” from the tax revenue. He noted that the city council actually capped the number of cannabis retailers in the city at three.
“Any revenue growth is based on increased sales at those two stores,” he said.
Clare is an Eastern Washington University graduate and a reporter at Free Press Publishing.
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