Colorado Marijuana Revenue Surpasses $1 Billion
Jun 17, 2019
The campaign in support of Amendment 64 promised Colorado voters that legalizing and taxing marijuana for adult use would generate substantial tax revenue for the state, including tens of millions of dollars each year for school construction projects.
That promise has been fulfilled, according to a report released this week by Vicente Sederberg with support from our partners at VS Strategies.
“Amendment 64 has clearly fulfilled its promise of raising significant new revenue for school construction projects,” said VS founding partner Brian Vicente, a lead co-author of Amendment 64 who also chaired the committee in support of Prop. AA, the legislatively referred measure that implemented taxes on adult-use cannabis.
“We were never under the illusion that legalization would be a fiscal panacea, but we knew it would have a substantial and positive impact. Funds are being used on everything from building schools to hiring school health professionals and paying for bullying prevention programs.”
The analysis of state data found the Colorado Department of Revenue has collected more than $1 billion in cannabis-related taxes and fees in the first 64 months since regulated adult sales started taking place in Colorado. Of those funds, more than $283 million have been directed to K-12 schools, with the bulk of it benefitting public school construction projects. It is also worth noting that this $1 billion figure does not include the hundreds of millions of dollars in local tax and fee revenue that has been collected by local governments.
Gov. Jared Polis highlighted the marijuana revenue milestone in a press release:
“Today’s report continues to show that Colorado’s cannabis industry is thriving, but we can’t rest on our laurels. We can and we must do better in the face of increased national competition. We want Colorado to be the best state for investment, innovation and development for this growing economic sector,” said Governor Polis. “This industry is helping grow our economy by creating jobs and generating valuable revenue that is going towards preventing youth consumption, protecting public health and safety and investing in public school construction.”
VS’s analysis and the governor’s statement generated local and national coverage, including pieces by Forbes, High Times, Colorado Politics, and Westword.
In addition to supporting Colorado schools, cannabis-related revenue has been used to fund substance abuse treatment and prevention efforts, mental health services and other public health programs, affordable housing, and cannabis-related research. Funds are also used to cover the costs of regulation, which accounts for a relatively small fraction of cannabis-related revenue. A portion of cannabis tax revenues are also shared with local governments.
The Colorado cannabis industry is poised for even more growth after the 2019 legislative session, where several cannabis-related bills were signed into law that permit public companies to own licenses, allows for hospitality licenses, permits regulated delivery, expands conditions for medical cannabis recommendations, and more. For more information on the bills, check out our Colorado Legislative Update webinar.
The full Vicente Sederberg report is available here.