Love it or hate it, the marijuana industry is exploding, and states where it has been legalized are reaping the financial rewards. If California residents vote to legalize pot in November, it could usher in a new Gold Rush.
No state is a better example of this than Colorado. In January 2014 alone, marijuana earned the state $3.5 million in tax revenue. From January through May of that year, marijuana created 10,000 new jobs.
In 2015, marijuana earned Colorado nearly $70 million in taxes, which allowed Pueblo County – where nearly 15% of the population lived below poverty level in 2007 – to set up scholarships for high school seniors looking to go to college.
Pot money has even been credited with saving the Colorado town of Trinidad from financial ruin.
Marijuana in California
Medical marijuana was legalized in California 20 years ago, and the state has the largest medical marijuana market in the United States. It is estimated that if recreational pot is legalized there, it would generate $1 billion in additional taxes per year.
If voters approve a measure that qualified on June 28 to legalize and tax marijuana, California would become the 5th state – not to mention the largest – to permit marijuana for recreational use. In addition to Colorado, recreational pot is legal in Washington, Oregon, and Alaska, as well as in the District of Columbia.
In 2010, a similar ballot initiative failed, but recent polls show the current initiative has a great deal of support.
If recreational marijuana is legalized in California, adults aged 21 and older would be allowed to possess up to 1 ounce of marijuana and to cultivate up to 6 plants. The initiative would also set rules for commercial cultivation, manufacture, tracking, and licensed sales. Additionally, it would create regulations to keep marijuana out of the hands of children, as well as penalties for impaired driving. [1]
Residents in Nevada, Maine, and 6 other states will also vote on recreational or medical marijuana ballot initiatives in 2016. But California – which has a population of 40 million – is the world’s 6th largest economy. That means that if marijuana is legalized there, it could propel the trend elsewhere.
Leslie Bocskor, of the Nevada-based private equity firm Electrum Partners, told Reuters:
“I don’t believe there will be any precedent in the United States that can compare to it except for maybe the Gold Rush.”
The Golden State could use a Gold Rush.
California’s medical marijuana sales were forecast to be flat in 2016, and to trend down over the next 5 years, due to stiffening oversight and more stringent regulations of the industry. Tax revenue to the state from medical marijuana was also expected to slump, from $109 million in 2015 to about $59 million by 2020.
Sources:
[1] Breitbart