Inside the city saved by weed: 'Bankrupt' Californian town booms after turning cannabis into £735m-a-year industry (6 Pics)

Potshop Green Pearl owner Nicole Salisbury sells the drug in Coachella

With just 400 dollars in the city’s coffers, Desert Hot Springs was out of luck, out of bucks and had pretty much gone to pot.

But now, thanks to cannabis , it has turned over a new leaf.

Industrial-scale weed production has converted this cashless, desperate place into a boom town enjoying a green equivalent of the 1850s gold rush.

Taxes paid by drug growers are set to bring in £11 million annually in what could become a £735 million-a-year industry.

Thousands of jobs are being created, land values have rocketed from £5,000 an acre to £140,000 and there will even be a DRIVE-THRU dispensary.

And that puts a whole new meaning on hash browns.

Reporter Greg Woodfield in Coachella, California

This city of 28,000 people in ­California’s Coachella Valley – famed for its music festival – was on the brink of collapse in 2014.

In desperation, councillors voted to embrace weed production.

The tight-knit community – a spa destination which attracted the likes of Marilyn Monroe – threw open its doors to marijuana growers.

It set aside 1,500 acres of desert scrub and businessmen besieged Mayor Scott Matas with plans.

Five dope firms are up and running, another 15 are on the way and a total of 60 have been given permission to grow weed.

Green Pearl cannabis dispensary in Desert Hot Springs

A “cannabis park” the size of 100 Tesco superstores is also under construction. Master cultivators will earn up to £180,000 a year for producing special strains.

The original plan was to allow growers to process medicinal ­marijuana, which has been legal in California since 1996.

But after the state legalised it as a recreational drug on January 1, there was no holding back the floodgates.

Mayor Matas explained: “We reached a crisis in 2014. There was just $400 in the bank.

“So we cut wages, we axed staff. We had no choice, it was a bad time. That did put us back on our feet financially but with serious consequences.

“We looked at various options and decided to open the door to cannabis.

“I was opposed at the beginning. But when I started discussing the medical side of it with people in the industry, many of them elderly sensible businessmen who had been helped in their pain relief by marijuana, I changed my mind.

“The people I talked to wore suits, they weren’t hippies. They had business plans that could help put us back on our feet. So we started to see cannabis not as a bad thing, but as a positive for the city.

“However, we weren’t prepared for the reaction after we announced our decision to be the first in California to welcome industrial-scale cultivation. It went crazy.

“I’d have all sorts of people turn up. That’s when the hippies and surfer dudes did come, but the majority were business people with a plan.

“We were swamped. We will double our budget to $30million (£22million) a year thanks to cannabis if these businesses succeed.”

Estate agent Paula Turner – who like Mayor Matas had to be converted to the idea – said: “Just like the Napa Valley is famous for wine and Silicon Valley for the tech industry, Coachella is going to be Cannabis Valley.

“In the financial crash, land values slumped 90 per cent. A lot of people were in serious trouble. They bought high and their investment had shrunk to almost nothing. Before cannabis came along the cheapest land could be bought for $7,000 an acre. That soared to $200,000 once the city announced it was open to the marijuana business. It has been wild.”

She admitted she had faced criticism for her role in the boom but defended medicinal use of cannabis, adding: “My husband was furious, my friends confused. But I came out of the closet and I’m very pleased with my decision. However, I still don’t believe in recreational marijuana.”

Jason Elsasser is head of the Coachella Valley Cannabis Alliance Network, which co-ordinates business inquiries. He said: “This is a potentially a $1billion annual business. That includes predicted earnings by the growers, taxes, knock-on benefits, thousands more jobs, money filtering into the local economy, you name it. It is huge and is already having a big impact. There is nowhere else like it.”

Former banker Greta Carter runs the Highroad consultancy, helping people start a cannabis business.

From her office on the main strip, she said: “I have about $40million of investors’ money in this city. In what is raw desert often used as a dump site, there will be beautiful new streets, infrastructure, sidewalks and utilities. That will be the investors in cannabis paying for that.”

Swing out of the strip mall and head a mile along Two Bunch Palms Trail and you come across Canndescent – the first local company to produce marijuana.

It expects to be selling £38million of weed by next year, producing blends designed “to create five emotional states” – calm, cruise, connect, create and charge.

Security is tight. Workers must account for all the cannabis they handle and an armed guard and 58 security cameras cover every inch.

But Canndescent will be dwarfed by Coachillin’, the cannabis industrial park which will cover 160 acres dedicated to growing, education and research.

It will employ 1,500 and will sell some products from a 20,000 sq ft drive-thru dispensary. Creator Kenny Dickersons believes Coachillin’ will eventually turn over $1billion a year on its own.

Amid the success, local police chief Dale Mondary fears criminals will attempt raids on factories, hijack loads leaving the city and intercept cash on its way in to Desert Hot Springs.

Banks insured by the US government are banned from handling money from cannabis businesses because any marijuana use is illegal under national law – despite a number of states accepting it.

Which makes this largely a cash business.

Chief Mondary warned: “We are only 120 miles from one of the largest illegal producers and users of marijuana, Los Angeles.

“We are cutting into the illegal practices and a multi-billion dollar industry that is close to us.

“Those people handle their disputes with bloodshed.”