New Haven nets $357K from pot, 'nip' liquor bottle sales

New Haven city government picked up extra cash for cleaner streets and other state-allowed public service programs as local sales rack up for legal pot and mini-liquor-bottle ​"nips."

According to city spokesperson Lenny Speiller and city Budget Director Michael Gormany, New Haven has received a total of $51,148.80 so far this year in tax revenue raised from the sale of legal adult-use cannabis. He said the city has also received a little over $306,000 so far this fiscal year in municipally collected surcharges related to the local sales of "nip" liquor mini-bottles.

The local pot cash comes thanks to the mandatory 3% municipal sales tax included in the 2021 state law that legalized recreational cannabis across Connecticut.

Only one dispensary — Affinity Health & Wellness at 1315 Whalley Ave. — has opened its doors in New Haven so far to sell legal adult-use recreational weed. That medical marijuana dispensary started selling recreational pot in January. Another retailer has its eyes set on, and is in the process of winning local and state approvals for, a new dispensary at the old home of Long Wharf Theatre on Sargent Drive.

Speiller said that the $51,000-plus that New Haven has received so far covers cannabis sales that took place in the city in January and February. Because Affinity is the only retailer currently open in town, all of that money comes from sales during those two months at that one venue.

How might this public money be spent?

The city does not have any specific plans yet as to how this cannabis-derived cash will be used, Speiller said. He pointed out that state law limits the public expenditures of such monies to six general categories.

"According to the public act," he wrote, ​"the funds can be used to (A) make improvements to the streetscapes and other neighborhood developments in and around each community in which a cannabis retailer, hybrid retailer or micro-cultivator is located, (B) fund education programs or youth employment and training programs in such municipality, (C) fund services for individuals released from the custody of the Commissioner of Correction, probation or parole and residing in such municipality, (D) fund mental health or addiction services, (E) fund youth service bureaus established pursuant to section 10 – 19m of the general statutes and to municipal juvenile review boards, or (F) fund efforts to promote civic engagement in communities in such municipality."

East Rock Alder Anna Festa asked about this very same new pot of public funds during Monday's latest meeting of the Board of Alders Finance Committee, which took place in-person in the Aldermanic Chamber on the second floor of City Hall.

City Budget Director Michael Gormany told the alders that money from marijuana sales has indeed started coming in. ​

"I am the contact for the Department of Revenue Services," Gormany said. ​"They give us a monthly report" on local cannabis sales, ​"then I work with Affinity to bill them for the sales [tax revenue] that is due to the municipality." That money then ​"goes into an account for use based on guidelines" detailed in the relevant state law.

Festa also asked on Monday night about how much money the city has brought in thanks to ​"nip" liquor bottle sales and how that money will be used.

In an email comment provided to the Independent on Tuesday, Speiller and Gormany said that ​"the total year to date revenue received is a little over $306,000" thanks to local ​"nip" sales.

That money comes thanks to a 5-cent surcharge that the state levies on each "nip" sale. Wholesalers must remit those surcharges to the municipalities where the "nips" were sold every six months.

Asked how this ​"nip"-derived city cash will be used, Speiller wrote: ​"Per Deputy Chief Administrative Officer Rebecca Bombero, the funds will be used for increasing recycling education and enhancing our street sweeping and litter removal operations."

This story was first published May 10, 2023 by the New Haven Independent.

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