Marijuana the Answer to California's Budget Woes? from Time.com

Is Marijuana the Answer to California's Budget Woes?

By TOM MCNICHOL/SAN FRANCISCO Tom Mcnichol/san Francisco 2 hrs 12 mins ago
Proponents of marijuana legalization have advanced plenty of arguments in support of their drug of choice - that marijuana is less dangerous than legal substances like cigarettes and alcohol; that pot has legitimate medical uses; that the money spent prosecuting marijuana offenses would be better used on more pressing public concerns.
While 13 states permit the limited sale of marijuana for medical use, and polls show a steady increase in the number of Americans who favor legalization, federal law still bans the cultivation, sale, or possession of marijuana. In fact, the feds still classify marijuana as a Schedule I drug, one that has no "currently accepted medical use" in the United States.
But supporters of legalization may have been handed their most convincing argument yet: the bummer economy. Advocates argue that if state or local governments could collect a tax on even a fraction of pot sales, it would help rescue cash-strapped communities. Not surprisingly, the idea is getting traction in California, home to both the nation"s largest supply of domestically grown marijuana (worth a estimated $14 billion a year) and to the country"s biggest state budget deficit (more than $26 billion).
On Monday, Gov. Arnold Schwarzenegger and the California legislative leaders a tentative budget agreement to plug the state's deficit, but it would involve making sweeping cuts in education and health services, as well as taking billions from county governments. Democratic state assemblyman Tom Ammiano has introduced legislation that would let California regulate and tax the sale of marijuana. The state's proposed $50 an ounce pot tax would bring in about $1.3 billion a year in additional revenue. Ammiano"s bill was shelved this session but he expects to introduce a revised bill early next year.
If the state legislature doesn"t act, perhaps California voters will. One group is preparing to place a statewide initiative for the November 2010 ballot that would regulate and tax the sale of marijuana for Californians 21 years of age and older. Tellingly, the group spearheading the measure calls itself TaxCannabis2010.org, stressing the revenue advantages of marijuana legalization. The group hopes to collect the required 650,000 voter signatures by January to place the measure on the November 2010 ballot.
"There"s no doubt that the ground is shifting on marijuana," says Ethan Nadelmann, executive director of the Drug Policy Alliance, which promotes alternatives to the war on drugs. "The discussion about regulating and taxing marijuana now has an air of legitimacy to it that it didn"t quite have before. And the economy has given the issue a real turbo charge."
The legalization effort is getting serious consideration from surprising quarters. In May, Gov. Arnold Schwarzenegger publicly called for a large-scale study to determine whether to legalize and tax marijuana.
"I think it"s time for a debate," the governor said at a news conference. "I think we ought to study very carefully what other countries are doing that have legalized marijuana and other drugs."
In California, medical marijuana sales are already taxed, and some communities are looking for ways to get a bigger slice of the pot pie. Residents Oakland are currently voting in a mail-in special election that includes a measure which would make the city the first in the country to establish a new tax rate for medical marijuana businesses. If the measure passes, Oakland marijuana dispensaries, which are now charged at the general tax rate of $1.20 per $1,000 in receipts, would see that rate raised to $18 per $1,000.
A Field Poll conducted in California this spring showed 56% of the state"s registered voters in support of legalizing and taxing marijuana as a way of offsetting some of the budget deficit. Several national polls have shown that more than 45% of American adults are open to legalizing pot, about double the support a decade ago.
Even the most ardent marijuana advocates aren"t expecting nationwide legalization anytime soon. Instead, any action is likely to come on the state and local level. For now, all eyes are on cash-strapped California, where high taxes could take on an entirely new meaning.
View this article on Time.com

California Assemblyman Announces Bill to Tax Marijuana

Assemblyman Tom Ammiano Introduces Bill that Would Decriminalize and Tax Marijuana for Adults
By Mechanic

California Assemblyman introduces bill to decriminalize and tax marijuana.
Assemblyman Ammiano says AB 390 will help state's economic downturn.
California State Assemblyman Tom Ammiano (D-San Francisco) has recently introduced Assembly Bill 390: The Marijuana Control, Regulation and Education Act, the first bill of its kind in the state of California that would decriminalize recreational marijuana use and set up the framework to regulate the sale and taxation of marijuana.
Under the bill, wholesalers of marijuana would pay an initial $5,000 licensing fee with a $2,500 annual renewal fee. Wholesalers are then able to sell marijuana to licensed retailers who would pay a "Marijuana Supplemental Fee" of $50 per ounce of marijuana sold to the public. This fee, officially the Marijuana Supplemental Fee Law, would be used to fund drug education and awareness programs but would not be applied to medical marijuana patients. The proposed bill would also restrict persons under 21 years of age from having "access to marijuana during receiving, processing, packing, storage, and delivery or at any other time," and restricts the consumption of marijuana on the property of wholesalers.
Financial Benefit
The announcement of the bill comes in the midst of tough economic times, both at the state and national level. Assemblyman Ammiano argues, "With the state in the midst of an historic economic crisis, the move toward regulating and taxing marijuana is simply common sense," he added, "This legislation would generate much needed revenue for the state, restrict access to only those over 21, end the environmental damage to our public lands from illicit crops, and improve public safety by redirecting law enforcement efforts to more serious crimes. California has the opportunity to be the first state in the nation to enact a smart, responsible public policy for the control and regulation of marijuana."
A study by the California State Board of Equalization estimated that taxing marijuana could generate 1.3 billion annually and a separate study conducted by California NORML estimated that the California cannabis industry to be worth between 12-18 billion dollars. A 2006 study conducted by Jon Gettman found that between 2003 and 2006, marijuana was America's #1 cash crop, marijuana production is California outpaced both vegetables and grapes, and estimated it's worth in the billions of dollars. Ammiano said, "I think the outcome would be very healthy for California and California's economy." A study by Harvard in 2005 estimated that by legalizing marijuana the federal government would save 7.7 billion dollars in prohibition enforcement and could generate taxes in between 2.4 and 6.2 billion dollars annually.
Medical Marijuana Vs. The Federal Government
In 1996, California voters approved Proposition 215, making California the first state in the United States to allow marijuana use for medical purposes. This put the state of California at odds with the Federal government's stance that marijuana is illegal to use, even for medical use, and would often make California's medical marijuana providers the subject of DEA raids. Under the 1970 Controlled Substance Act, marijuana is classified as a Schedule 1 narcotic (no medical benefit) despite numerous medical studies outlining marijuana's medical potential. Since the 1996 passing of Prop. 215, fifteen additional states have approved state medical marijuana legislation.
Proponents of the bill, including Assemblyman Ammiano, admit that one obstacle for the success of the bill is the federal ban on marijuana. However, recent polls suggest that Americans are growing more in favor of decriminalizing marijuana and even the federal government hinted that it may stop DEA raids on medical marijuana providers. Ammiano is hopeful, "We could in fact have the political will to do something, and certainly in the meantime this is a public policy call and I think it's worth the discussion."
Mixed Reactions
Marijuana activist groups like the National Organization for the Reform of Marijuana Laws (NORML), and The Marijuana Policy Project (MPP), have received the announcement of the bill with open arms, but opponents are not receiving the bill so well. In the few days since the announcement of the bill, a fierce debate has already developed. In what be a surprise to some, Gavin Newsom, the mayor of San Francisco, has spoken out against the measure. The LA Times published an editorial calling the bill an "ill advised tax scheme," on one hand but urges the government to review it's policies on marijuana because "it's the right thing to do". With advocates citing financial and practical benefits and opponents citing health concerns, only time will determine the outcome.

Sources:Assemblyman Ammiano's WebsiteAB 390 Text; Feb. 2009NORML; Feb. 2009CA NORML; Feb. 2009Marijuana Production in US, Jon Gettman, Drug Science, 2006About Jon Gettman, Drug Science, 200640% Say Marijuana Should Be Legalized, Rasmussen Reports, Feb. 2009State by State Laws(CA), NORML, 2008WAMM.org, 2002Therapeutic Effects, Medboardwatch.com, 2002US to yield marijuana jurisdiction to states, SF Chrnoicle, Feb. 2009Legal pot is not mayor's cup of tea, SF Chronicle, Feb. 2009Reefer Tax Madness, LA TImes, Feb. 2009
2009 © Associated Content, All rights reserved. Privacy Policy Terms of Use