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Marijuana taxes alone can’t fix school funding

Posted: 7:04 PM, Apr 26, 2018
Updated: 2018-04-26 21:04:54-04

Amid the statewide debate over teacher pay, many News 5 viewers have asked where all of the marijuana tax money is going. Perhaps a better question is how much money Colorado spends on its schools.

That’s because the $8.95 billion in K-12 spending each year put the $211 million collected in marijuana taxes into perspective.

Even if all of the marijuana tax revenue was committed to schools, it would mean a difference in per-pupil spending of about $243. But marijuana taxes get spread across state government.

The Marijuana Industry Group is a trade association for Colorado’s cannabis industry. They get asked about where the tax money goes so often that they commissioned a 5-minute animated video to explain how the state spends that money.

"The video obviously is a lot more enticing than having to read a 7-8 page document," said MIG spokeswoman Stacy Rosemore.

For the most part, marijuana taxes are split between schools and the rest of state government. In Fiscal Year 2016-2017, a total of $102 million went schools ($40 million to school construction, $32 million to the School Permanent Fund, and $30 million to the Public School Fund for rural districts.)

The language of Amendment 64 specifically taxes marijuana businesses to generate that $40 million in school construction every year.

Meanwhile, sales and excise taxes paid by marijuana customers go into what’s called the Marijuana Cash Fund which is controlled by the state legislature. In FY 2016-2017, that fund received $118 million. The current budget list 64 areas where that money is spent across more than a dozen state departments.

"They’re also going to public education and safety, affordable housing, law enforcement," Rosemore said. "It really is all across the board."

She said there’s a broad misunderstanding that marijuana taxes can pay for just about any school need.

"$211 million does look like a lot of money but when you look at the entire State of Colorado budget, it’s really just a drop in the bucket."

The $40 million in school construction funds are administered through the Building Excellent Schools Today (BEST) program which also collects revenue through conservation easements. In 2017, the BEST program awarded $70 million in grants to school districts around the state.

The demand for those building improvement grants is so high nearly half of all the districts who applied went away empty handed.

Nearly a decade ago, the Colorado Department of Education conducted a State Facility Assessment which estimated the total capital improvement need for all 178 school districts to be roughly $13.9 billion.