Sales tax revenue from the proposed first adult-use cannabis dispensary in Washington may give residents property tax relief.

The possibility was brought up this week during a Washington City Council discussion about a special-use request for the dispensary, which would be built on a nearly one-acre vacant site at the intersection of Centennial Drive and McClugage Road.

City Manager Jeff Fiegenschuh supported the property tax relief idea and explained how it would be done.

“Any sales tax derived from the facility [would] be dedicated to some property tax relief program; it won’t go into the general fund,” he said, adding that if the dispensary is approved, a policy would be created so council members can determine where the sales tax dollars will go.

Alderperson Bobby Martin III suggested also using dispensary sales tax revenue to fund the construction of sidewalks that would make it safer for children to walk to school; bicycle and scooter safety education for youths; and Drug Abuse Resistance Education [DARE] programs at elementary schools.

Washington has a 9% city sales tax, and an additional 3% sales tax can be applied to dispensary products.

The discussion about property tax relief took place during the council’s first reading of a special-use request for the dispensary by Key Cannabis. A decision is expected May 18.

Alderperson Paula Johnson said she’s heard from several residents who fear a “domino effect” of more dispensaries coming to town if this one is approved.

“That’s not going to happen,” she said. “There can only be one dispensary in the city.”

Despite some reports implying that Washington could have six dispensaries, the city code allows only one of the six types of adult-use cannabis businesses, including dispensaries, subject to the council’s approval of a special use.

Martin asked Key Cannabis several follow-up questions after a company representative spoke to the council last month.

Among the answers Martin received is Key Cannabis sells the same products at its dispensaries whether they’re licensed as a medical or recreational business; odor isn’t an issue at their dispensaries because products are packaged; and customers with a medical marijuana card would receive a state sales tax break at the Washington store even though it would have a recreational license.

Five Washington residents spoke against the dispensary at this week’s council meeting, reiterating concerns previously raised about the negative impact it could have on Washington’s reputation as a family-friendly community, the proposed location of the dispensary, and that it could normalize the use of cannabis.

The dispensary meets all of the city’s zoning requirements.

At its April meeting, the city’s Planning and Zoning Commission unanimously recommended council approval of the special use with several additional conditions.

Eight conditions added recently by council members will be part of the special use application that council will consider May 18.