Colorado Pot Taxes: Not a Good Deal for Schools

Recent headlines proclaimed that Colorado raked in $44 million in tax revenues on recreational pot in 2014.

Amendment 64 promised voters there would be an excise tax on wholesale sales of retail marijuana, and the first $40 million raised each year by this tax would go towards public school construction.

But the 2014 revenues from that excise tax only amounted to just over $13 million.1 That’s not much school construction; it’s probably not even one whole school building.

Even among people in the marijuana industry there’s confusion, or obfuscation, about how much money from pot sales is going to schools in Colorado. The marketing director for a marijuana-infused product quoted here claimed that $40 million of 2014’s marijuana tax revenues went to “education.”

Nope – none went to education, but $13 million (not $40 million) will eventually go to school construction.

In exchange for a few school remodels a year, Coloradans have gotten:

  1. Marijuana tourists.
  2. More public pot consumption.
  3. Less enforcement of laws about public consumption of marijuana.
  4. More pot advertisement and promotion.
  5. More kids hospitalized due to consumption of marijuana edibles.
  6. Less understanding that pot is harmful to teens’ brains.
  7. More users among our state’s population.
  8. More citizens on the medical marijuana registry than prior to legalization of recreational marijuana.
  9. More pot on middle and high school campuses.

Not such a good deal for schools.

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1. Take a look at the State Department of Revenue’s numbers. Look at the Year-to-Date numbers for May and December 2014 and add them to get the total for calendar year 2014. The total of that excise tax is $13,341,000.

“The industry should not take a knee-jerk stance against regulation.”

Part of a comment on the last post, about novice users, was this: “The industry should not take a knee-jerk stance against regulation.”

The problem is that Colorado’s marijuana industry does reflexively object to, and actively fight, restrictions and changes to the way they’ve been doing things in the medical marijuana arena. When it comes to regulations, the marijuana industry ignores the fact that most retail (recreational) users are novice users and/or are from out of state. (Most regular recreational pot users in Colorado have medical cards.)

Colorado’s retail marijuana code currently requires that no more than 100 mg of active THC be in each individually-wrapped package of retail edibles (no more than ten 10mg servings of active THC can be in one individually-wrapped package). This limit was difficult to get to, because the industry fought it.

There are no limits on THC amounts per package of medical edible. So the industry objected to initial attempts to limit the amounts of THC per retail package to 10 mg. 100 mg was a compromise that the industry was not terribly happy with. They’d have to change their packaging! That costs money! (Along with trying to increase user numbers, this reaction is a natural part of capitalism.) So they fought, but eventually compromised at 100 mg, 10 times the amount proposed by non-industry groups involved in writing the legislation.

The proposed new lower limit of 10 mg makes much more sense, and it looks as if that will go forward and become law. It’s sad that sensible limits can only be achieved after tragedy. (Of course, a piling-up of tragedies is how we ended up with seatbelts being required by law to be provided in all cars.)

Capitalism doesn’t work for all the people in a country unless there are regulations to protect consumers, who don’t have the special knowledge that the people in the industry have. Unlike people in the marijuana industry, and experienced users, novice users have no knowledge of what might happen if they eat an entire pot cookie. Maureen Dowd ate one-quarter of her pot chocolate bar. There was no labeling on the candy to suggest that would be too much.

Businesses, especially when they have investors to answer to, do not do things that cut into their profits unless required to by law – even when public safety is an issue. So the industry fights changes and restrictions. Industry always has.

Colorado’s marijuana industry absolutely owes more to its novice-user consumers, even though that might cut into their profits. They owe consumers clear labeling, they owe consumers sensible THC amounts per package, they owe consumers some respect. Novice users in this industry should not be ridiculed for mistakes made due to lack of understanding, due to lack of explanation, especially when it’s the industry itself who pushes users in the direction of edibles.

Budtenders often recommend edibles instead of flower products to novice users, especially those who don’t smoke tobacco. There were no widespread stories like Maureen Dowd’s in the early days of 2014, when Colorado’s retail marijuana shops first opened, but, because of flower product inventory concerns in January, many retail pot shops pushed edibles pretty hard to consumers. With inventory concerns, employees of the store were not eager to share their knowledge that smoking is the easiest way to consume pot without overconsuming.

Again, more users, new users, are all part of the marijuana industry’s plan. It’s time for the marijuana industry and its fans to stop ridiculing the people who call for more safety measures to protect people such as the new users that this industry will soon come to rely on in order to remain profitable.

Legalization = Commercialization = Novice Users

Pot legalization means pot commercialization. Pot commercialization means advertising to, and drawing in, novice users.

More users, new users, are all part of the marijuana industry’s plan. Full legalization, such as Colorado’s, doesn’t work without commercialization. Commercialization doesn’t work without bringing in new users to keep investors’ and owners’ profits up.

Novice users mean lots and lots of experiences like Maureen Dowd’s and some experiences like Levy Thamba’s.

The marijuana industry and its fans keep blaming the victims – saying they should have known, they shouldn’t have eaten the whole cookie, they should have quizzed the budtender who sold them the edibles on how long, how much… A novice user has no idea what questions to ask.

Quit blaming the victims. Novice users are part of legalization of pot. The recreational marijuana industry needs to admit that they accept and embrace that, and do things that safely accommodate novice users, such as, I don’t know, print serving sizes on all packages? Put only one serving of pot in each individually packaged edible? Put only one serving of pot in only one serving of food, and individually package that?

The Colorado marijuana industry needs to stop whining about the regulations that are being imposed on them in an attempt to keep the public safer, and admit their own culpability in new users’ bad (or fatal) experiences with pot.

And the rest of the country needs to understand that legalization absolutely does mean an increased number of users. Voters, ask yourselves if you’re ok with that. (Legalization of medical marijuana is just the first step to full legalization of marijuana for recreational use. Before you vote yes on medical marijuana, ask yourself if you’re ok with going all the way on this.)

 

 

 

Froma Harrop is Way Off Base on Marijuana Legalization

Froma Harrop’s recent column suggests that legalizing marijuana is a good way to reduce heroin addiction. Her main point is this: “Bringing heroin addicts in for treatment deprives the cartels of their best high-volume customers. Legalizing pot puts them out of their most lucrative business. Using tax revenues from the legal sale of marijuana to pay for treatment completes the virtuous circle.”

Her main point makes some sense, but there are some huge problems with her overall logic.

Ms. Harrop claims “Because drug cartels garner 60 percent of their revenue from the marijuana trade, legalizing pot would smash up their business model.”

The problem with this logic is that these cartels are diversified businesses. Their business models don’t just crumble when pot gets legalized. They continue to diversify, and focus on their other areas, such as human trafficking, human smuggling, weapons trade, and trade in other drugs. How could they not? They won’t just go away. Just like all of us earning a living, cartel people have employees to keep, families to feed, bills to pay. They just move their focus from marijuana to something else. In fact, they often move on from growing and trafficking in marijuana to growing for and trafficking in heroin. This Washington Post article suggests that legalization and decriminalization of marijuana in the U.S. could be the cause of more easily available heroin across the U.S., and has actually led to today’s heroin epidemic.

Ms. Harrop writes “Why the heroin epidemic now? Much of the surge in heroin use stems from the recent crackdown on prescribed painkillers.” Partly true. But mostly, an increase in heroin addiction stems from an increase in doctors’ prescribing narcotic painkillers. Doctors prescribe too much of too many drugs to too many people. Many people become addicted, and look for something cheaper than the prescription drugs and find it in heroin. The prescription drugs used to be easier to find on the street than they are now. And heroin wasn’t so plentiful on the street before widespread legalization and decriminalization of marijuana in this country.

When it comes time to make laws and policies, the marijuana industry might not want to promote legalization by saying that the tax revenues from sales of pot would go to treat opioid addiction. That’s not a great selling point.

When trying to promote a legalized recreational drug industry in our country, it’s so much easier to sell voters and legislators on tax revenues for schools than to remind them of the drug addiction problems plaguing our country.

 

Hard to Tell Marijuana Edibles Apart from Candy

Some marijuana-infused food products look, and taste, an awful lot like familiar candy and other sweets, especially when they’re out of the package.

A number of children have already been admitted to Children’s Hospital Critical Care Unit in 2014 because they ate marijuana-infused edibles that looked, and tasted, like regular sweets, and became severely depressed and ill with “an altered mental status.”

http://denver.cbslocal.com/2014/04/10/pot-or-not-can-you-tell-which-is-the-marijuana-edible/

A couple bills heard today in the Colorado House might help keep kids safer: http://denver.cbslocal.com/2014/04/10/hash-oil-edible-pot-before-colorado-lawmakers/

 

Colorado Still Has Unlicensed Medical Marijuana Dispensaries Selling Pot

Despite Colorado laws passed in 2010 requiring medical marijuana businesses to be licensed, Colorado still has some unlicensed medical marijuana dispensaries that are open and selling marijuana.

Businesses that were already open before the laws were passed had to apply for licenses, and were allowed to continue to operate while their applications for licenses were being reviewed. Nearly 4 years later, some applications for licenses are still being reviewed by the State.

Two of these unlicensed medical marijuana dispensaries were recently shut down by the State for violations of the laws regulating operations of medical marijuana businesses. Alleged violations include growing more plants than allowed by law, not having the number of security cameras required by law, and not tracking plants to make sure that the plants grown in the grow operations go only to the stores, which is required by law. (The grow operations haven’t been shut down, just the stores.)

As reported in today’s Denver Post, the owner of the stores is suing the State, claiming that his stores shouldn’t have been shut down, because included in the list of alleged violations was a reference to a criminal case against the owner, related to his marijuana business. He is suing because he said that State regulators told him that they wouldn’t shut down his business as a result of this criminal case unless there was a criminal conviction.

The State has enough on him to shut his stores down without these criminal charges. (The charges are that he was “using his marijuana businesses to run an investment scam and to illegally distribute pot,” according to the Denver Post.) His dispensaries are in violation of State laws with or without these criminal charges.

This story is a good illustration of the mess Colorado has created for itself. Why do we still have unlicensed medical marijuana dispensaries selling pot? And why do some of these business owners think they can get away with anything?

 

 

 

Problems With Marijuana Legalization

A wonderfully comprehensive piece about problems with legalization of marijuana by David Frum was published online today in “Commentary.”

Some highlights from the piece:

“Advocates of legalization carried the vote with a substantial campaign budget, a few million dollars, and a brilliant slogan: “Drug dealers don’t ask for ID.” The implied promise: Marijuana legalization would be joined to tough enforcement to keep marijuana away from minors.”

“With so many medical-marijuana card-holders walking about, it was simply inevitable that some would re-sell their marijuana to underage users. A 2013 study of Colorado teens in drug treatment found that 74 percent had shared somebody else’s medical marijuana.” (entire article here)

“the best customers for the marijuana industry are not adults at all. The majority of people who try marijuana quit by age 30. Adults in their twenties are significantly less likely than high school students to smoke; 14 percent of twentysomethings say they smoke marijuana, while 22.7 percent of 12th-graders smoke at least once a month, and 6.5 percent say they smoke every day.”

“the trend presents marijuana sellers with a marketing problem. Yet there is promising news from the emerging marijuana industry’s point of view: People who start smoking in their teens are significantly more likely to become dependent than people who start smoking later: about 1 in 6, as opposed to 1 in 10. Start them young; keep them longer. Very rationally, then, the marijuana industry is rolling out products designed to appeal to the youngest consumers: cannabis-infused soda, cannabis-infused chocolate taffy, cannabis-infused jujubes.” (entire article here)

“The promise that legalization will actually protect teenagers from marijuana is false. So, too, are the other promises of the legalizers. It is false to claim that marijuana legalization will break drug cartels. Those cartels will continue to traffic in harder and more lucrative drugs, such as heroin, cocaine, and methamphetamine. Criminal cartels may well stay in the marijuana business, too, marketing directly to underage users. Public policy is about trade-offs, and marijuana users need to face up to the trade-off they are urging on American society. Legal marijuana use means more marijuana use, and more marijuana use means above all more teen marijuana use.”

“Some older adults have a hard time crediting the dangers of marijuana use because they imagine the marijuana on sale today is the same low-grade stuff they smoked in college. The marijuana sold in the 1980s averaged between 3 and 4 percent THC, the psychoactive ingredient. Today’s selectively bred marijuana averages over 12 percent THC, with some strains reaching 30 percent.” (entire article here)

“Our brains are wired for addictions.” 

“Lucrative industries have arisen to exploit these weaknesses in ways highly harmful to their customers. And the bold irony is that when their practices are challenged, they’ll invoke the very principles of individual choice and self-mastery that their industry is based on negating and defeating. So it was with tobacco. So it is with casino gambling. So it will be with marijuana.”

Please read the entire piece by David Frum.

Vote against legalization of recreational marijuana in your state. You don’t want what we have here in Colorado.

If you don’t want legalization of recreational marijuana, vote against legalization of medical marijuana in your state. On its face, medical marijuana isn’t bad. (It’s primarily a joke, here in Colorado, but it’s not horrible.) But in the strategic plans of marijuana industry groups, medical marijuana is just one step along the way to legalization of recreational marijuana.

For legalization proponents, “regulate” is code for “legalize.” After legalization, once actual regulation starts to be implemented, the marijuana industry protests and sues and complains and lobbies… you don’t want this where you live.

 

 

 

 

Not Like a Wine Review…

Marijuana strains are reviewed on “The Cannabist,” the Denver Post’s marijuana website, reached through the Denver Post’s marijuana page. http://www.denverpost.com/marijuana

In each review, the high obtained from consuming the pot is described. Here’s a review from last month: http://www.thecannabist.co/2013/12/30/marijuana-review-triple-diesel/1450/

“It starts as a warmth in my chest, and by the fourth drag it’s radiated through my arms and down my legs. There is a little bit of dry-mouth happening, but it’s moderate and stays consistent throughout the duration of the experience. Any anxiety I was feeling is a thing of the past, and my usual lower back tension is gone. Huge.

“This is where I would recommend stopping if you have things to accomplish, responsibilities to attend to or a real life to live on this particular day.

“But I continue. Real life be damned.”

Newspapers and their websites that review beer, wine, and liquor don’t describe the feelings that people get when they consume, or over-consume alcohol.

Taste is the focus of reviews of alcohol products.

The main content in marijuana strain reviews is the high the consumer feels. And this is described in a supposed news outlet, accessible to anyone online, without even having to click a box that says you’re at least 21 years of age (or a medical marijuana patient). I’m not sure what the Denver Post is thinking.

 

Another Way Marijuana Is NOT Being Regulated Like Alcohol

In the State of Colorado, a person can own no more than one liquor store. There is no such restriction on owners of retail marijuana stores.

Amendment 64 declared that “marijuana should be regulated in a manner similar to alcohol.” But when it comes to retail marijuana stores, this isn’t what Colorado is getting.

There are several chains of Colorado medical marijuana stores already (several stores owned by one entity), and, in Denver, each of those individual stores can convert to a retail marijuana store. In fact, two Denver stores in one chain are all ready to open in a few days, on January 1. Here’s a Denver Post article listing the stores that open next week.

Liquor store owners have complained about this restriction for years, but the Colorado Liquor Code remains unchanged: “It is unlawful for any owner, part owner, shareholder, or person interested directly or indirectly in a retail liquor store to conduct, own either in whole or in part, or be directly or indirectly interested in any other business licensed pursuant to this article…” (Colorado Liquor Code 12-47-407. Retail liquor store license, Paragraph 4.)

Here’s a letter describing another way in which liquor stores are being regulated more strictly than retail marijuana stores.

The Colorado Retail Marijuana Code just hands over the right to chain-store ownership to this brand-new industry, an industry which remains federally illegal, and has not yet had the time to prove itself to be able to follow State regulations.

 

What Does Amendment 64 Say?

Amendment 64, the amendment to the Colorado Constitution that legalizes marijuana, has some language in it that some people don’t seem to realize they voted for.

“Notwithstanding any other provision of law, the following acts are not unlawful and shall not be an offense under Colorado law… Consumption of marijuana, provided that nothing in this section shall permit consumption that is conducted openly and publicly or in a manner that endangers others.”

This language gives the Colorado state legislature, and municipal governments in Colorado, the right to prohibit open and public consumption of marijuana, and still be complying with the Constitution. It gives governments the right to regulate consumption of marijuana.

The Amendment also gives municipalities the right, under the Constitution, to “prohibit the operation of … retail marijuana stores through the enactment of an ordinance…” This gives governments the right to regulate the operations of marijuana businesses in their jurisdictions. Some have decided to prohibit retail marijuana businesses altogether.

Marijuana boosters called Denver Councilwoman Robb’s proposal to prohibit marijuana use on front lawns “unconstitutional.” They called Denver Councilwoman Ortega’s proposal to prohibit marijuana use on front lawns within 1,000 feet of schools “an attack on Amendment 64.” They mentioned “property rights” and “constitutional rights” as their reasons for demanding public marijuana use. 

All property rights and all constitutional rights have limits; regulations apply to most of our rights. There are plenty of legal things that are not allowed in view of the public, even on private residential property. People are not allowed to urinate or to have sex on their front lawns. These activities are legal, and we are allowed to do them in private, but regulations prohibit us from doing these perfectly legal things within view of others.

Amendment 64 would not have passed without allowing the prohibition of public marijuana consumption, and without allowing the local control that municipalities have. Municipalities are well within their rights to exert that control. Denver City Council has let itself be bullied by the marijuana industry, into allowing things that some voters never imagined. Front lawn pot smoking is not what many Denverites thought they were voting for.

Here’s a link to Amendment 64:  http://www.leg.state.co.us/LCS/Initiative%20Referendum/1112initrefr.nsf/c63bddd6b9678de787257799006bd391/cfa3bae60c8b4949872579c7006fa7ee/$FILE/Amendment%2064%20-%20Use%20&%20Regulation%20of%20Marijuana.pdf