Colorado

Mar 11, 2014 1:36 AM by Maddie Garrett

Debate over where marijuana sales tax dollars should go

The first month of recreational marijuana sales in Colorado is off the charts, with $2.1 million generated in tax revenues from retail sales alone. In total, it's estimated that $14 million was spent on marijuana sales in January.

Numbers released by the Department of Revenue show about $3.5 million was generated in marijuana tax revenues and fees, that includes medical and recreational sales. The marijuana money includes a sales tax of nearly 13% on every ounce sold, and excise tax of 15%, plus other local fees.

While medical sales still outnumbered recreational pot sales 2-to-1, the retail pot sales are bringing in the big bucks with those hefty taxes. And some counties think that some of those tax dollars should be distributed across the state, not just in counties where recreational marijuana is allowed.

"Every dollar that was generated is a dollar that is kept out of the black market and I see that as a very positive sign for cleaning up our communities," said Pueblo County Commissioner Sal Pace.

Pace is not just talking about his community, but others nearby, like El Paso County.

"The impacts could be that they're saving money by us having adult recreational marijuana," explained Pace.

But El Paso County Commissioner Dennis Hisey doesn't see it that way, saying they are likely seeing added costs as a result of recreational marijuana sales nearby.

"The DUI's and some of the other social costs will be felt," said Hisey.

He said that's why other counties that don't allow recreational pot sales should get a portion of the special sales tax revenues.

"To offset the expenses we know we're going to have if recreational marijuana is sold anywhere around us," Hisey said.

Hisey compares the issue it to gambling rules in Colorado, where counties near gambling communities still get some of the revenues from the casinos.

"The state recognized when they approved gambling many many years ago that the impacts would be felt in places other than the gambling counties," said Hisey.

But Commissioner Pace doesn't think the marijuana business works in the same way.

"If those counties want some of the sales tax revenues then they should put in the lengthy work that we've put into regulating recreational adult marijuana," Pace said.

For now that's the way things will work.

At the state level, the first $40-million in excise tax revenue is slated for school construction, but that likely won't go far with 177 school districts in Colorado. As for the rest, that's still up in the air. The state has plans to spend it on youth drug prevention programs, public health, and a small portion to law enforcement.

 

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