If Michigan voters elect to legalize marijuana in November, the state can expect to collect hundreds of millions of dollars in tax revenue over the next five years, according to a new report from the non-partisan Michigan Senate Fiscal Agency.
In fact, the new estimates are even higher than those projected by the group sponsoring the legalization ballot measure.
While that group, Regulate Marijuana Like Alcohol In Michigan (RMLAM), predicted that the state would collect about $520 million in cannabis sales and excise tax revenue in the five years after implementation, the government estimate is closer to $730 million over the same time span.
The agency’s report is “more bullish than ours,” Josh Hovey, spokesperson for RMLAM told Marijuana Moment.
“We knew from the get-go that ours was a very conservative estimate and we wanted to make sure we had something that wasn’t going to oversell the public on legalization. Because, in retrospect, whether it’s $130 million a year or more than $200 million a year, that is just secondary to ending unnecessary arrests and freeing up the court system.”
The initiative, Proposition 1, would impose a 10 percent excise tax on non-medical cannabis sales in addition to the state’s six percent sales tax. It would also eliminate a three percent tax on medical cannabis “provisioning centers,” which was accounted for in the fiscal report.
Where would all that money go?
The 10 percent excise tax revenue would be distributed for transportation infrastructure (35 percent), schools (35 percent) and local jurisdictions that permit adult-use marijuana businesses to operate in their municipalities and counties (15 percent each).
Based on the government report, that means that by the 2022-23 fiscal year, out of of $252 million in total marijuana tax revenue, about $126 million will go toward road construction and K-12 education funds on an annual basis from the excise tax alone. On top of that, schools would receive an additional $77 million a year due to marijuana commerce, allocated from the state’s six percent sales tax.
Then, of course, there’s the cost savings of simply ending marijuana arrests and related prosecutions and incarcerations, as the Michigan Senate Fiscal Agency noted. The proposition “could have a positive fiscal impact on State and local government,” according to the report.
“Fewer felony arrests and convictions could decrease resource demands on court systems, community supervision, jails, and correctional facilities. In 2016, 199 people were sentenced to prison for a marijuana-related felony conviction, and 3,620 were sentenced to jail, probation, or a combination of both.”
The chances that Michigan ends up legalizing marijuana for adult-use seem fairly strong. A September 2018 poll from The Detroit News and WDIV-TV found that 56 percent of likely Michigan voters favor fully legalizing cannabis, compared to just 38 percent who said the opposed ending prohibition.
Senate Schedules Hearing On Marijuana Business Banking Access
In one of the clearest signs of marijuana reform’s growing momentum on Capitol Hill, a Republican-controlled Senate committee has scheduled a hearing for next week that will examine cannabis businesses’ lack of access to banking services.
The formal discussion in the Senate Committee on Banking, Housing and Urban Affairs on Tuesday comes as legislation aimed at resolving the marijuana industry’s financial services problems is gaining momentum. A House cannabis banking bill that cleared that chamber’s Financial Services Committee with a bipartisan vote in March now has 206 cosponsors—nearly half the body—while companion Senate legislation has 32 out of 100 senators signed on.
(Marijuana Moment’s editor provides some content to Forbes via a temporary exclusive publishing license arrangement.)
Congressman Files Marijuana Bill After Leaving Republican Party
In one of his first legislative acts since leaving the Republican Party earlier this month amid a feud with the president, Rep. Justin Amash (I-MI) filed a bill on Monday that would let states set their own marijuana policies without federal interference.
If that sounds familiar, it’s because bipartisan legislation that would accomplish the same goal has already been filed this Congress.
But unlike the nearly identical Strengthening the Tenth Amendment Through Entrusting States (STATES) Act, Amash’s new bill excludes one provision that would require the Government Accountability Office (GAO) to study the effects of cannabis legalization on road safety and issue a report on its findings within a year of the law’s enactment.
That language states that the GAO must study “traffic crashes, fatalities, and injuries” in legal cannabis states, actions taken by those states to “address marihuana-impaired driving,” testing standards being used to detect impaired driving and federal initiatives “aiming to assist States that have legalized marihuana with traffic safety.”
Given Amash’s libertarian leanings, it stands to reason that he opposes spending government dollars to conduct the research and simply supports the broader states’ rights intent of the original legislation.
That would also put him at odds with social justice advocates who feel that the STATES Act itself doesn’t go far enough and are pushing for more comprehensive legislation that includes additional provisions addressing social equity and restorative justice for people harmed by drug law enforcement.
Members of the House Judiciary Crime, Terrorism and Homeland Security Subcommittee heard that debate play out during a historic hearing on ending federal marijuana prohibition last week.
A newly formed coalition of civil rights and drug reform organizations, including the ACLU, is also insisting on passing wide-ranging legislation to deschedule cannabis entirely that also invests in communities that have been disproportionately impacted by prohibition.
Amash is a long-standing critic of the war on drugs and earlier this year signed on as a cosponsor of a separate bill that would federally deschedule marijuana. Rep. Tulsi Gabbard (D-HI), a 2020 Democratic presidential candidate, filed that legislation, which is also silent on social equity provisions.
— Justin Amash (@justinamash) March 8, 2019
Gabbard also introduced a separate bill that would require the U.S. Department of Health and Human Services and other federal agencies to study the impacts of legalization. True to form, Amash declined to add his name to that measure as well.
Read the text of Amash’s new cannabis bill below:
Photo courtesy of Kyle Jaeger.
Berkeley City Council Considers Decriminalizing Psychedelics This Week
A resolution to decriminalize psilocybin and other psychedelics will go before a Berkeley, California City Council committee on Wednesday.
Decriminalize Nature, the group behind the measure, also led the charge to successfully get a measure decriminalizing entheogenic plants and fungi approved by the City Council in neighboring Oakland last month.
In Berkeley, the Public Safety Committee will discuss the proposal and can either decide to hold it for a future meeting or advance it to the full Council. The public is able to attend Wednesday’s special meeting and share their perspective on the resolution, but Decriminalize Nature stressed in a tweet that this “is a small meeting, so you do NOT need to attend.”
Is it time for #DecriminalizeNature #Berkeley? Agenda 4 at the public safety meeting this Wed. July 17, with the Decriminalize Nature team! This is a small meeting, so you do NOT need to attend. But if you live in Berkeley, write your City Council! https://t.co/gMSDkegMPU
— Decriminalize Nature (@DecrimNature) July 15, 2019
However, city residents are being encouraged to write to their Council members and urge them to vote in favor of the measure, which would codify that “no department, agency, board, commission, officer or employee of the city, including without limitation, Berkeley Police Department personnel, shall use any city funds or resources to assist in the enforcement of laws imposing criminal penalties for the use and possession of Entheogenic Plants by adults of at least 21 years of age.”
The resolution defines the covered substances as “plants and natural sources such as mushrooms, cacti, iboga containing plants and/or extracted combinations of plants similar to ayahuasca; and limited to those containing the following types of compounds: indoleamines, tryptamines, phenethylamines.”
Councilmembers Rigel Robinson and Cheryl Davila are sponsoring the resolution, which does not allow for commercial sales or manufacturing.
The lawmakers provided background information on the measure in a report to their colleagues and the mayor, describing the medical potential of various psychedelics as well as the success of decriminalization measures in Denver and Oakland.
“It is intended that this resolution empowers Berkeley residents to be able to grow their own entheogens, share them with their community, and choose the appropriate setting for their intentions instead of having to rely exclusively on the medical establishment, which is slow to adapt and difficult to navigate for many,” they wrote.
While efforts to eliminate criminal penalties associated with psilocybin and other psychedelics have so far centered in jurisdictions that have historically embraced marijuana legalization and broader drug reform, the conversation around decriminalizing psychedelics is spreading nationally.
Shortly after Oakland approved its measure, Decriminalize Nature received inquiries from activities in cities from across the country. The group has kept track of each city where organizers are pursuing decriminalization.
Nature lovers are organizing coast to coast (and Hawaii)! Is your city on the map? Connect to join with your local community, or if you have the motivation to propose a similar initiative in your city/town/county, let’s start growing! contact [email protected] #DNUSA pic.twitter.com/38UxLKK9RN
— Decriminalize Nature (@DecrimNature) July 2, 2019
On Monday, a conversation around changing laws governing psychedelics reared during a City Council meeting in Columbia, Missouri. One resident implored the body to take up a resolution to decriminalize the natural substances, pointing to their therapeutic benefits.
Councilmember Mike Trapp said that the student’s proposal should be considered and that a government advisory board on public health should provide input on the medical potential of psychedelics, describing it as “very promising.”