Wisconsin residents purchased more than $121 million worth of marijuana from legal retailers in neighboring Illinois in 2022, contributing about $36 million in tax revenue to the state, according to a legislative analysis requested by a top Wisconsin senator.
Senate Minority Leader Melissa Agard (D), who has sponsored legalization legislation in past sessions, asked the non-partisan Legislative Fiscal Bureau (LFB) to study just how much money was flowing from Wisconsin to Illinois in the form of out-of-state cannabis purchases.
LFB released its findings last week, estimating $121.2 million in marijuana sales from Wisconsin residents last year.
To come up with that figure, analysts looked at data from the Illinois Department of Financial and Professional Regulation (IDFPR), which disaggregates monthly in-state and out-of-state cannabis sales and also provides county-by-county breakdowns.
LFB said that its estimates are based on the assumption that all out-of-state marijuana purchases in counties directly bordering Wisconsin came from Wisconsinites.
Wisconsin’s out-dated marijuana laws are costing us so much more than $36 million – lives are being disrupted – but this is so upsetting to see Wisconsinites hard-earned tax dollars go to Illinois because WI GOP refuses to listen to the will of the people. https://t.co/TkqUEeOH8F
— Senator Melissa Agard 🌻 (@SenatorAgard) March 17, 2023
However, it pointed out that the actual numbers could be higher or lower based on a variety of factors, including the likely possibility that portions of out-of-state sales in the border counties came from people in other nearby states like Iowa or that Wisconsin residents could have paid for cannabis in Illinois counties that don’t directly border their state, such as Cook County where Chicago is located.
Further, the analysis doesn’t account for potential sales in other adult-use states near Wisconsin like Michigan.
Despite that margin of error, however, the report gives a basic idea of the amount of revenue that Wisconsin is losing out on as the GOP-controlled legislature continues to resist enacting legislation to create a regulated marijuana market in the state.
“It should upset every Wisconsinite that our hard earned tax dollars are going across the border to Illinois,” Agard said in a press release. “This is revenue that could be going toward Wisconsin’s public schools, transportation infrastructure, and public safety. Instead, Illinois is reaping the benefits of Republican obstructionism and their prohibitionist stance on marijuana legalization.”
“We are an island of prohibition and the people of our state are hurting because of it,” she said. “As seen in our neighboring states, legalizing marijuana for responsible adult usage will generate significant revenue for our mainstreets, safely regulate the existing illicit market, reinvest in our agriculture and farming heritage, support entrepreneurship, and address the massive and egregious racial disparities from marijuana prohibition.”
A separate report published last month by Wisconsin Policy Forum found that 50 percent of adults 21 and older in the state live within 75 minutes of an out-of-state cannabis retailer, such as in Illinois or Michigan. That percentage stands to increase if legislative efforts to legalize marijuana in neighboring Minnesota are successful this session.
Meanwhile, Gov. Tony Evers (D) released his biennial budget request last month, and it again included language to legalize medical and recreational marijuana in the state.
— Senator Melissa Agard 🌻 (@SenatorAgard) March 17, 2023
The governor had previously signaled that he planned to put the adult-use measure in his request, despite a top GOP lawmaker warning that taking that step could compromise negotiations on more modest medical cannabis legislation.
Agard said that “if Republicans choose to remove it from the budget, I will once again introduce my bill to achieve this goal,” adding that it’s “high time we get this done for the betterment of our state and the people living here.”
“The fundamental aspect of our job as legislators is to listen to the people we represent. The people of Wisconsin have been asking the legislature to take up common sense measures that will push our state forward,” the minority leader said. “We know that legalizing cannabis for responsible adult use is wildly popular among Wisconsinites, including the majority of Republicans.”
Wisconsin residents sent $36 million in tax revenue and $121 million in total sales to Illinois last year because Republicans in our state refuse to legalize marijuana.
It’s past time we joined our neighbors in legalizing cannabis. pic.twitter.com/VCtgSSfIpj
— Senator Chris Larson (@SenChrisLarson) March 17, 2023
As part of the governor’s budget request, his office estimated that the state would generate $44.4 million in “segregated tax revenue” from legal cannabis, as well as a $10.2 million increase in state general fund tax revenue, in fiscal year 2025 if the reform is enacted.
The governor also included adult-use and medical marijuana legalization in his 2021 budget, as well as decriminalization and medical cannabis in his 2019 proposal, but the conservative legislature has consistently blocked the reform.
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While Assembly Speaker Robin Vos (R) said in January that trying to enact adult-use legalization through the budget could “poison the well” in the legislature, jeopardizing talks on medical cannabis, the leader of the Senate has expressed that he thinks the more modest policy is feasible this session.
“Our caucus is getting pretty close on medical marijuana,” Senate Majority Leader Devin LeMahieu (R) said. “A lot of our members, who are maybe at a point where they can vote for it now, they just want to make sure it’s regulated well.”
The governor said recently that he was encouraged by the Senate leader’s remarks about nearing consensus on medical marijuana, and he’s prepared to sign such legislation as long as it’s not “flawed” by including too many restrictions.
Evers didn’t bring up his legalization proposal in his budget speech this year, but he did stress in his inaugural address last month that the state needs to have a “meaningful conversation about treating marijuana much like we do alcohol.”
Some Wisconsin lawmakers have filed bills to legalize cannabis for adult use—and former Assembly Majority Leader Jim Steineke (R) has said legalization is “likely” to happen at some point—but the legislature has so far failed to pass even more modest proposals like decriminalization or the legalization of medical cannabis.
Ahead of the November election, Evers met with college students and urged supporters to get engaged and vote, in part to ensure that the state advances marijuana legalization.
If Democrats had won enough seats, it could have also set them up to pass a resolution that the governor introduced to allow citizens to put initiatives on the ballot. Advocates expressed hope that the move could open the door to finally letting voters decide on marijuana legalization, but it’s unlikely that GOP lawmakers will go along with it.
Meanwhile, voters across the state have been making their voices heard on cannabis reform over the past several election cycles. Most recently, voters in three counties and five municipalities across the state approved non-binding advisory questions on their local ballots in support of legalization.
The local votes are largely meant to serve a messaging purpose, providing lawmakers with a clear policy temperature-check among their constituents. But those that were approved will not change any laws by themselves.
A statewide poll released in August found that a solid 69 percent of registered voters in Wisconsin believe that cannabis should be legal. That includes 81 percent of Democrats, 75 percent of independents and 51 percent of Republicans.
Republicans filed a limited medical cannabis bill last year—and it got a hearing on the unofficial marijuana holiday 4/20, but that came too late in the legislative session for lawmakers to actually vote on the measure.
Other GOP members have filed bills to more modestly decriminalize marijuana possession in the state, but none of those proposals advanced.
As it stands, marijuana possession is punishable by a maximum $1,000 fine and up to six months in jail for a first offense. People convicted of a subsequent offense would face a felony charge punishable by a maximum $10,000 fine and up to three and a half years in prison.
The governor vetoed a GOP-led bill last year that would have significantly ramped up criminal penalties for people who use butane or similar fuels to extract marijuana.
And in the interim as lawmakers pursue reform, the governor has issued hundreds of pardons during his years in office, primarily to people convicted of non-violent marijuana or other drug offenses.