Legalizing marijuana could bring in $2 billion for Washington
SEATTLE (AP) - The state's latest financial analysis says legalizing and taxing marijuana could bring Washington as much as nearly $2 billion over the next five years — or as little as nothing.
The Office of Financial Management released its fiscal impact statement for Initiative 502 on Friday, and the results track closely with its earlier analysis, released in March.
I-502, which will be on the November ballot, would legalize pot under state law and allow its sale at state-licensed stores, with tax proceeds dedicated to education, health care and substance abuse prevention. Oregon and Colorado voters will also decide on marijuana legalization measures this fall.
Marijuana would remain illegal under federal law, however, and it isn't clear how the federal government would respond if any of the states voted to legalize it. The Justice Department could prosecute employees of state-licensed pot shops, sue in federal court to block the laws from taking effect, or simply seize the tax revenue from the states as proceeds of transactions that are illegal under federal law.
Because the federal response remains unclear, Washington's analysts said they could not determine the ultimate effect of I-502 on the state's finances. However, they said, assuming a fully functioning marijuana market develops — and that it entirely replaces the existing illicit market — state revenue from pot sales could be more than $1.9 billion over the next five years. The state typically spends $30 billion per two-year budget cycle.
I-502 would create a system of state-licensed growers, processors and stores, and impose a 25 percent tax at each stage. People 21 and older could buy up to an ounce of dried marijuana, one pound of marijuana-infused product in solid form, such as brownies, or 72 ounces of marijuana-infused liquids.
The analysis anticipates 100 state-licensed growers supplying 328 marijuana stores that would sell more than 187,000 pounds to at least 363,000 customers. Those numbers are based on federal drug-use surveys.
Consumers would pay $12 per gram — the price currently charged by many medical marijuana dispensaries — plus the 25 percent marijuana tax, 10 percent state sales tax, and any local sales tax, the analysts assumed.
The document noted that Washington would likely lose some federal money to fight drugs, such as a marijuana eradication grant from the Drug Enforcement Administration.
However, the analysis did not take into account any possible savings from no longer arresting, prosecuting and jailing people for having small amounts of marijuana, and Alison Holcomb, campaign manager for I-502, said she found that disappointing.
About 10,000 people in Washington are charged with misdemeanor marijuana possession each year.
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Johnson can be reached at https://twitter.com/GeneAPseattle
Copyright 2012 The Associated Press.
i am reading how much less it hurts to smoke matijauna than cigs is red dirt less dirty thant black dirt   less just say for comparison  duhhhÂ
is this like the medical card that when one in the family is allowed the whole family and friends indulge  . ok less see how many more duis and deaths occurÂ
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 @2nd Baseman  @TayaD I can't believe that in most of these countries alcohol is legal but pot (which actually has some medical benefits unlike booze) is illegal. Wow... Do the producers of alcoholic beverages have anything to do with this? Does foreign policy have anything to do with this? Crazy...
What!?!? My Guinness has no medical benifits!?!? Say it ain't so! ;-(
Oh, well, who cares. No one can stop me now!
Did this just occur to them? Of course it will still be illegal to grow it on your own.
So you legalize it and then the government authorizes 328 stores to sell it. Why buy it when you can grow it like a "weed"? So then the government will sick the police on folks that grow their own. We will have traded the drug cartels for the government.
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Another prediction: when it becomes legal you will have a huge number of new smokers trying it out. revenues will be huge and the problems that go along with it too. Give the people what they want.
by my calculations it should be a 15 trillion dollar industry
Legalize it! We are still one of the only counties where it is illegal. Think of all the time and money it takes to fight it. PLUS it would help end the illegal drug wars being waged over it!Â
I thought smoking anything was bad for your health. How is this different than smoking tobacco products?
 @jpk Use a vaporizer for all things smokeable.  No smoke, just vapor.  Works very well.
I suggest the vapor ends up in the same lungs as the smoke! Inhaling burning anything cannot be good for the health!
@Gravity Works! .......same affect as smoking?
 @Rob C  @Gravity Yes, the same.
 @jpk Cigs are much more carcinogenic than marijuana. Much, much.
And the state could hire the cartels to collect the money and invest it for them in offshore banks!
It's the illegal dealers and the pharmaceutical companies who want to keep this silly prohibition in place.
I don't think people understand how much money, time, and effort there is to growing it. A large percentage, if legalized, would pay more to keep it legit. Believe it or not there are more hard working people than you know who indulges from time to time. Why not tax it and make some money off of it?Â
legalizing it- the smartest thing Ive heard all year
 @LostSoul I'm hoping that it will free up law enforcement to concentrate on more pressing matters.
It's all smoke, no mirrors.
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Once it's legalized people will grow their own and sell it on the black market. Instead of going after folks for selling an illegal drug the government will go after folks for tax evasion.
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Eastern Washington is excellent for growing pot and anyone who wants it will just start some in their backyard.
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Now securing it is another issue all together. At $12 per gram that is 1/5 the price of gold and criminals will just be reaching over a fence and stealing the buds. Whoever grows it for the state will have to have some serious security measures.
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Employers will be getting rid of a lot of workers for a dirty UA. Almost all industrial and construction employers have a no drug policy including prescription drugs OTC meds that alter mental status.
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No one has really thought this through to the obvious conclusion and any way it happens it will be a can of worms.
 @RalphCramden  I don't really think that this will happen.  Marijuana will be so ubiquitous after legalization that the black market value will plummet.
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You don't see people operating their own moonshine stills anymore, do you? Â Perhaps people brew their own beer, but it's not exactly a high theft target.
 @UtterReality If is avoids paying taxes then it is black market.
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Cigarettes are brought onto New York to avoid the high taxes. Moonshine was both for prohibition and to avoid the taxes (moonshiners were afraid of the "revenuers" more that other agents).
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The black market for jobs is alive and well. Folks are working "under the table" to avoid paying taxes which is the black market.
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Moonshining is alive and well and you can buy all the stuff online to make your own hooch. It is still illegal under federal law but once again it is a law that is rarely enforced.
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As for making beer that is a distinct difference between the fermentation process for beer and distillation which is used to make hard liquor.
 @whirledworld Very true. So we will be in even more danger than we are now.
 @RalphCramden The police barely even touch on the number of drunk drivers out there at any given time.
 @UtterReality Moonshine is done more for hobby these days but in the south there are still a lot of moonshiners who sell for profit.
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The taxes on marijuana will he high. That you can count on. It will be as high as cigarettes.
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For this reason there will be a thriving black market. As long as people can grow there own, which is very easy to do, there will be those who won't be paying taxes.
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On another note, there will be lots of folks who can't get jobs because they won't be able to pass the pre-employment drug screen. Also employment applications will ask about drugs. They already ask about nicotine use and many refuse to hire if they use nicotine in any form.
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Police will go from arresting those using marijuana to those using marijuana and driving so not much will change as far as police enforcement of marijuana.
 @RalphCramden I personally have only seen moonshine a couple of times.  I can't imagine that people bother to make it for profit motive. Â
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Care to guess on a street price after legalization? Â There's approximately one half gram of marijuana in a cigarette. Â From what I just read, MJ goes for 6-8 Euros per gram in Amsterdam. Â However, your estimate of $12/gram ($6 a joint) isn't too far off...but that's obviously going to be full retail purchase price at a coffee shop.
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Sure there will be a black market trade for marijuana like cigarettes, but I can't imagine it being nearly as bad as it is now.
@ RalphCramden ~ Although I am still in favor of legalizing MJ, I have to agree that this particular way of doing it could easily create more negative issues than positive ones.    I think we're going to have problems with this unless and until it is legalized on a national basis; that is, with the Federal laws amended.
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I can just hear the uproar if Washington State voters passed I-502, and then the Feds just seized all the tax money because it was the result of "proceeds of transactions that are illegal under federal law"...
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This is one of those things that needs to be fixed at the federal level, and THEN at the state level...and regardless of what we-the-People want, I seriously doubt that the policitians in DC will do it until they figure out a way that will make it profitable (more money and/or more power) for them...
 @margay1 The feds won't do a thing different until the states show them it's inevitable.
 @margay1 There are so many laws that conflict with state law and all of them need to be worked out because it puts all of us at risk at some point.
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Oreogn law allows me to carry a concealed gun. If I am out in the backcountry and come across a ranger station and stop in to get some information and have my gun I am now in violation of federal law and the punishment is pretty severe.
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If I sell medical marijuana in Oregon it is legal but the feds could bust in my door at anytime and charge me with selling restricted drug and could end up doing 20 years.
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This whole federal versus state law thing is a real mess.
 @whirledworld There is a business tax that I pay, along with everyone else, who shops in Portland or Multnomah county. It is about 3.75% total on every purchase. While it isn't added on to the product at the till it is factored in to the overall operation because all the businesses have to pay it based on their income.
 @RalphCramden What's wrong with shopping in Portland? You don't pay sales tax here.
 @margay1 Well said.
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You are correct about downsizing. The good news is that finances will force government to downsize and that is okay with me.
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I do everything in my power to pay as little tax as I can on everything. I even shop online as much as I can so that I am not supporting Portland and when I do have to shop locally I go to other areas outside of Portland and Multnomah.Â
@RaplhCramden ~ I could not agree more!  This is only one of the problems we have, as residents/citzens of individual states, by having such an over-grown federal gov't that has gotten totally out of control..!   Somehow, I just cannot imagine that our founding fathers ever intended our federal gov't to get as large and/or as controlling as it has become...
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The worst of it is, it's always MUCH harder to downsize something than it is to keep it under control, and at a manageable size, right from the start... and I think this is where we, as citizens/voters, have failed... because it's been so easy just to let the Feds pay for / deal with whatever the issue is, that we've "let the genie out of the bottle"... and now we can't figure out how to get it back IN the bottle!
Keep it illegal legalizing it will just drive up the price,you want more revenue, tax churches
 @Ghetto Baby Can't like this one, even though I'm for taxing the churches. Legalizing pot makes sense to me. At least we should stop enforcing the laws except in cases where another crime is happening.
I would like to see it legaized but am voting against it because I don't want all the money to go to schoolteachers and doctors. They have enough. It's time to spend money on the basics, roads, parks, police and firefighters, areas that benefit all of us.
 @hankhandsome Interesting that people find roads, that encourage oil consumption and pollution, more of a basic need than educating their children.
 @Nobody I couldn't like that comment enough. It always baffles me that people don't want to fund education or think they have enough funding. The only conclusion I can come to is those people are uneducated and are afraid that young people will take their jobs in a few years. Simple cowardice.
 @hankhandsome You have to understand that more revenue going into one area often frees it up to flow into others.  This is more of an issue of our elected officials managing money properly.
 @hankhandsome How does not paying teachers and doctors benefit us? You don't recognize the benefit of educating our nation's youth or quality healthcare services?
A state full of pot addicts who dont want to work. Â Great.
And that is different from your state currently full of welfare addicts who don't want to work how?
 @wondering No, no...I think you mean drunks.
$2 billion and a generation of pot addled Washington youth. A good trade.
 @TimBurr the youth already some pot so that won't change but the $2 billion? Oh, that *will* make some good change possible.
I guess we could pass a law so they can sell it at Costco. The low prices combined with the 50% tax ought to price most addicts out of the market.
 @al_02 There's no such thing as a pot addict.  There sure are a hell of a lot of alcoholics though.
 @UtterReality  @al_02 I strongly disagree that there's no such thing as a pot addict.Â
 @UtterReality According to Leslie L. Iverson, a professor of pharmacology at the University of Cambridge; "between 10 to 30% of regular users will develop dependency. Only about 9% will have a serious addiction." Perhaps not the classical definition - a chemical dependency with symptoms of withdrawal. More of a "mental" compulsion sort of addiction. People always want to point to alcohol being worse. While this may well be true, just because we made one mistake, does not mean it is okay to make another.
nice to see the gubments starting to think like drug kingpins. just legalize it so people can grow their own, possess it, and sell it