To its fans, marijuana has long been the solution to many problems, and for three states with pot legalization measures currently on the ballot to be decided this November, the hope is that the herb will solve several financial issues in government.
Combined with the savings that will come from stopping most pot-related law enforcement, advocates in Washington State, Oregon and Colorado are hoping that the taxes collected on the pot’s sale and distribution will make up some of the shortfalls from reduced federal aid and declining tax revenues.
Those fighting for pot legalization in Colorado refer to these economic upsides of legalization explicitly via an ad jingle that goes “Jobs for our people. Money for schools. Who could ask for more?” But even the most dedicated supporters of the effort concede that it is hard to predict exactly how much money the states are likely to take in if the legalization initiative passes.
Although supporters predict a substantial windfall, they are unwilling to commit to an exact number. Those who oppose it, especially the skeptics from the state government, counter that anything gained via taxes and reduced criminal justice costs could be swallowed up by the price of maintaining a new regulatory regime aimed at tracking marijuana sellers and growers.
Although income is being used as the main selling points in the legalization efforts in all three states, how it will be spent varies substantially:
- Colorado’s campaign touts money for school construction. Ads promote the measure with the tag line, “Strict Regulation. Fund Education.” State analysts project somewhere between $5 million and $22 million a year. An economist whose study was funded by a pro-pot group projects a $60 million boost by 2017.
- Washington’s campaign promises to devote more than half of marijuana taxes to substance-abuse prevention, research, education and health care. Washington state analysts have produced the most generous estimate of how much tax revenue legal pot could produce, at nearly $2 billion over five years.
- Oregon’s measure, known as the Cannabis Tax Act, would devote 90 percent of recreational marijuana profits to the state’s general fund. Oregon’s fiscal analysts haven’t even guessed at the total revenue, citing the many uncertainties inherent in a new marijuana market. They have projected prison savings between $1.4 million and $2.4 million a year if marijuana use was legal without a doctor’s recommendation.
One of the groups driving the Colorado campaign, the Campaign to Regulate Marijuana Like Alcohol, says that it makes no sense for states to allow illegal bodies like drug cartels and drug dealers to benefit from the healthy market for the drug. Instead, the government should legalize the drug and handle it the same way it handles other “sin” products like liquor and tobacco.
Those looking for exact numbers, however, will have some time to wait. Since the efforts in the states to legalize pot without major restrictions are first in the nation – other states have legalized pot for medical purposes only – what will actually happen if the initiatives pass “is anyone’s guess.”