Once again, legal pot has generated eye-popping tax revenue.
This time the windfall is for Nevada. Voters there approved legal cannabis in November of 2016, and the first recreational stores opened in the summer of 2017.
Sales since have been immense. Already a major tourist destination thanks to Las Vegas, Nevada drew in even more visitors in 2017/2018 thanks to its legal cannabis market.
Now a full year after recreational shops started welcoming customers, Nevada’s pot sales are expected to surpass $500 million in the first year of legalization. That’s a full 25% more than initial financial forecasts had predicted.
Of that money, around $70 million is tax revenue. Further benefitting the state, about $25 million of that figure must go towards Nevada’s school system.
The financial results were immediately immense. During the first six months that cannabis was legal in Nevada, the $195 million in sales generated were even higher than the opening half-year for Washington ($67 million) and Colorado ($114 million) after those two trendsetting states kicked off recreational cannabis.
But in terms of social and public safety impacts, concerns remain. Like all states, Nevada continues to struggle with how exactly to enforce effective cannabis DUI laws.
Some school officials have come forward with complaints that cannabis use among minors has skyrocketed since recreational shops have opened. Part of the problem, they believe, is that adults are disseminating the drugs among minors after legally purchasing the products.
Anti-pot activist Jim Hartman, chairman of Nevadans for Responsible Drug Policy, told the Associated Press, “it only makes sense to me if you legitimize [cannabis] and make it more accessible, you are going to get more youth use.”
But what about all that extra money going towards Nevada schools? “They are celebrating the sale of marijuana products,” Hartman told the AP. “It isn’t as though SAT scores are increasing.”
Does the benefit outweigh the cost? Are extra tax dollars worth an increase in cannabis usage among minors? These are questions that all states will have to consider as they consider legalizing cannabis, or enforce pot markets already open and running.
And when you consider the high cost of an education budget — or the hundreds of millions of dollars necessary to construct a new school — how much is $25 million really going to help? Obviously every dollar is valuable when funding education, but the pro-school effects of legal cannabis may also be somewhat overblown.
Another common criticism of Nevada’s recreational cannabis industry is that it has negatively affected existing medicinal patients. Reportedly, dispensaries now carry fewer high-potency products, since those are illegal for recreational purchase. But patients with painful ailments require these stronger drugs for analgesic purposes. Now it’s actually harder for them to get what they need, thanks to broader legalization.
Part of the problem here is that recreational sales bring in far more money for the state than medicinal. While politicians may not want to admit it, their attention naturally goes towards the larger dollar signs. Medicinal concerns may have taken a backseat to recreational.
That too is an issue that regulators must consider as they continue to shape the future of legal cannabis in America.
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Author: Kyle Swartz