Marijuana Pays For Schools In Colorado — Kind Of — But How Will It Help Maine?
Voters in Maine and a handful of other states are deciding whether to legalize recreational marijuana this November. One thing that could swing the vote is the possibility of millions of dollars in tax revenue from retail marijuana sales. Colorado was the first state in the country to roll out a tax scheme for legal marijuana in 2013, after recreational marijuana was legalized in 2012. So how are voters in Colorado spending the cash, and what should Maine voters expect?
Maine, like a lot of other states, could always use more revenue, so the possibility of millions from legalizing marijuana is enticing. But many voters there are unsure how that money will be spent. Erin McGee Ferrell spoke to us in downtown Portland. McGee is a foster parent and says she doesn't get reimbursed much. She says that area is one state program that could use more funding.
"I know there's a lot of problems in terms of needing more money for health issues and people who are addicted to opioids. I mean, there's such a lack of money for children, and health issues," she says.
The mayor of Portland, Ethan Strimling, shares voters' concern. Specifically, he wants to know, how is the money from marijuana going to be dedicated to individual communities?
"All we have at the local level is property taxes," Strimling says. "It would be great if some of the revenue that's generated from this legalization could stay in the community where it's having the most impact."
In other words, to fund substance abuse programs to offset any of negative impact of legalization.
In Colorado, it's a mixed bag with regard to where the money from pot is spent.
The state has a slew of local and state taxes on retail marijuana. Almost everybody through the entire supply chain is paying into the system, including growers, testing laboratories and retail shops. To some extent, pot is paying for schools in Colorado, with much of the state tax revenue going toward school maintenance and construction - paying for things like new roofs and HVAC systems in rural school districts.
But Chris Stiffler, an analyst with the Colorado Fiscal Institute, a nonpartisan think tank, cautions against getting too excited about marijuana tax revenue.
"We like to talk about it as if you were walking home today and you found a $20 bill on the ground," Stiffler explains. "You wouldn't go home and buy a new car or new house. But you would maybe go out for a Chipotle burrito with guacamole and a margarita, right?"
He says when voters in Colorado were considering legal marijuana, some of them thought that this was going to be a huge amount of money for education.
"They want to know why they're not getting new schools, more teachers, why they're not getting better roads because they were promised so many marijuana dollars were going to fix and pay for the things that really drive their communities," Stiffler says.
The revenue is basically a drop in the bucket for the state budget. But for local communities, which can levy their own taxes on the marijuana industry, it appears that marijuana tax money can actually make more of a difference.
Take Edgewater, Colorado, a small town of 5,300 people in the Denver metro area. The city has five retail marijuana shops and they're projected to bring in more than $1 million in marijuana tax revenue this fiscal year. To put that in perspective, their annual budget is $6 million, so that's one so that's one sixth that's coming from marijuana.
Mayor of Edgewater, Kris Teegardin says,"Tax sales have been able to speed up major infrastructure improvements otherwise we that would have to take a very incremental approach to."
One of those improvements is road paving. Teegardin even jokes that maybe they should be paving the road in green to show people how their marijuana tax dollars are being spent. They're also putting money toward a brand new civic center and a police station. Other cities in Colorado are funding homelessness programs and mental health centers. But Teegardin is not banking on this money coming in forever.
"This is something that we know could go away in the blink of an eye," he says. "Or, it could have a downturn when other states legalize it or other municipalities decide to join, so we are really looking at a murky forecast for sales in the next three to four years."
With that in mind, tax analysts say the possibility of more revenue from pot shouldn't be the sole reason to support marijuana legalization because it may not be enough to solve big budgetary problems that states face.
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