States Take Cautious Approach On Estimating Pot Legalization Proceeds
With both Oregon and Washington voters considering measures this fall to legalize recreational marijuana use, an obvious question to ask is: Just how much pot are we talking about here? Of course, that's impossible to say, since it's unknown how much state regulated weed will cost, and what effect legalization will have on usage rates. Still, as part of the election process, both states produce a "financial estimate" of each ballot measure. The estimate includes anticipated expenses to government as well as new revenues should the measure pass. So these estimates should give us an early indication of how much pot will be sold, right?Not really. In Washington, the estimate was released Friday to screaming headlines: "Measure to legalize pot could bring billions to state coffer" reported the Everett Herald. "Legal Pot Could Bring in 2B" read the Seattle Post-Intelligencer. Upon further examination, the actual estimate was "as high as" $1.94 billion over five years, or around $500 million per year. Still, a half-billion dollars represents a lot of marijuana sales. But wait: the same officials estimate that "the amount of revenue generated to state and local government could be as low as zero." Presumably this wouldn't be because Washingtonians would stop smoking pot if it was legalized. Instead, the "zero" estimate allows for the possibility that recreational marijuana users will continue buying their weed in the same way they do now: from unauthorized, unlicensed dealers.In Oregon, the committee responsible for creating an estimate of the financial impact of Measure 80 didn't even go so far as to dangle a temptingly large number in front of voters. Instead, the panel--which includes Secretary of State Kate Brown and Treasurer Ted Wheeler--pegged the costs to the state (primarily administrative) at around $23 million a year and simply left the revenue impact at "indeterminate." But they did add that the revenue is "likely to cover expenditures." So they expect that Oregonians would purchase at least $23 million in legal marijuana each year.
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Aug. 13, 2012
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