Colorado to send extra marijuana revenue to schools

After two votes this week, the state is set to start investing extra marijuana tax money in social goods like schools, scholarships, and drug abuse prevention, trying to make good on its promise that legalizing cannabis would benefit all Coloradans.

Brennan Linsley/ AP/ File
David Shepard prepares supplies at The Grass Station, a recreational marijuana store in Denver, Colorado, during a one-day tax holiday in this September 2015 file photo. Last week, Coloradans voted to give excess tax revenue to schools and drug abuse prevention.

Coloradans were feeling generous last week.

Two thirds voted in favor of Proposition BB, which allowed the state to hold on to all money raised through marijuana taxes, after Colorado became the first in the nation to legalize and tax recreational use, in 2012.

State law mandates that voter-approved taxes, like the one on marijuana, be returned to citizens if revenue is higher than predicted in the first year. This year, the overflow would have given each Coloradan roughly $8. Instead, they voted to let the state hold on to its $66 million, of which $40 million will go to school construction, $2.5 million to drug education, and another $2 million to other youth programs. 

Meanwhile, Pueblo County, home to the world's largest outdoor marijuana farm, voted to increase growers' taxes to help fund college scholarships, expected to raise $3.5 million.

Recreational marijuana is legal in just four states — Washington, Alaska, and Oregon, in addition to Colorado — as well as the District of Columbia. Many more permit use for medical reasons. But at least ten more are scheduled to vote in the near future, whether in legislatures or referenda, and critics and supporters alike are watching closely to see if Colorado can deliver on its promise to turn marijuana sales into more than pure profit.

Retail marijuana purchases in the Centennial State are subject to the 10 percent state marijuana tax, the 2.9 percent state sales tax, and a 15 percent excise, for a total of 27.9 percent, plus any local sales taxes. Perhaps because of the taxes, many users still purchase illegally: an estimated 40 percent, according to Forbes. 

Still, many lawmakers say their if you can't beat 'em, tax 'em approach is an undeniable success. 

"The people who were smoking marijuana before legalization still are. Now, they're paying taxes," Gov. John Hickenlooper told USA Today. 

But critics say that's exactly the problem, and fear that legalization, which can suggest the drug is not harmful, will further encourage marijuana use. One study published in the Lancet this July found that, while teen marijuana use was higher in states where it had been legalized, it didn't represent an increase; those states had higher rates all along. 

Yet a "Don't do drugs" message may be harder to take seriously when it's paying school bills, some worry.

"We know that in high school students, perception of harm is very much correlated with use. If high school students think something is harmful they're much less likely to use it, and the converse is very much the case," Dr. Stephen Ross, director of addiction psychiatry at NYU's Tisch Hospital, told CBS in 2014. Dr. Ross estimated that about one in ten marijuana users become dependent.

Another study, from NYU, found that ten percent of unlikely marijuana users said they'd be curious to try if it were legalized. 

The drug's long-term effects are unclear, but according to the American Psychological Association, heavy use early in life has been linked to diminished cognitive abilities later on in life, as well as potentially more serious mental health problems. 

The correlation, if not causation, is clear when it comes to academic performance. According to the 2009 National Youth Risk Behavior Survey, one in ten "A" students had smoked it in the past month, versus 19 percent of "B"s, 30 percent of "C"s, and 48 percent of "D"s. Overall, 38 percent of college students report trying it while they were in high school. 

Pueblo County must attempt to teach teens to avoid marijuana, but simultaneously "encourage the growth and development of that industry," Tyler Henson, the president of the Colorado Cannabis Chamber of Commerce, told CNN. 

But balancing the competing demands of 'sin taxes' is nothing new. State lotteries, for example, have long justified gambling by pointing to the money poured back into education, similar to Colorado's marijuana revenues.

But at the Washington Post, Valerie Strauss noticed that many states with lottery-to-school systems were still cash-strapped:

... instead of using the money as additional funding, legislatures have used the lottery money to pay for the education budget and spent the money that would have been used had there been no lottery cash on other things. Public school budgets, as a result, haven’t gotten a boost because of the lottery funding.

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