Will Legalized Marijuana Ignite New Interest?
Governor John Hickenlooper signed a set of bills into law last week that regulate the recreational use of marijuana in Colorado. The move comes after voters in the Centennial State passed Amendment 64 last November, making it the first state to end marijuana prohibition. Mary Jane is slowly losing her forbidden status, but will the laws attract more users?
The new measures to regulate recreational marijuana involve how the plant should be grown, sold, and taxed. They also set blood-level limits for motorists at 5 nanograms per milliliter, and limit purchases of marijuana to tourists at one-quarter of an ounce.
The full effects of the marijuana changes in Colorado are yet to be seen, but the potential for attracting users is large. More Americans than ever admit to at least trying marijuana. According to a recent Pew Research Center survey, 48 percent of adults say they had at least one dance with Mary Jane, up from 40 percent just three years ago. However, only 12 percent of those returned to the dance floor within the past year.
While 30 percent of those polled say they smoke for medical reasons, almost half use marijuana primarily “just for fun.” Twenty-three percent cited both reasons.
Unsurprisingly, young adults appear most likely to boost the marijuana economy in Colorado. Fifty-six percent of young adults admit trying marijuana, and 27 percent say they have smoked it in the past year. That is the highest percentage in any age category. Young adults also show the greatest amount of support towards legalization efforts, at 64 percent, compared to only 33 percent among those at least 65 years old.
This November, voters in Colorado will be asked to approve a 15 percent excise tax and a separate 10 percent special sales tax. In addition, cannabis will be subject to a 2.9 percent general sales tax and any local taxes. The Colorado Futures Center, a nonpartisan research organization at Colorado State University, recently issued a report on the fiscal impact of Amendment 64. It estimates that with marijuana being legal for people 21 and older, 642,772 Coloradans will use marijuana in 2014.
The organization excluded non-Coloradans using marijuana in the state, so the estimate of 642,772 is likely to be conservative. In comparison, 108,951 Coloradans held medical marijuana cards as of February 2013. Using historical data, the Colorado Futures Center estimates a per-person per-year usage rate of 3.53 ounces. This translates to an annual demand of 2,268,985 ounces. After applying taxes and various average costs, the organization believes Colorado will bring in an additional $130.1 million in state tax revenue in fiscal year 2014-15.
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