State System Already Broken Says Pot Growers and Sellers
It was supposed to be a win-win. People clamoring for their weed would be able to legally smoke it, the state would sell it making millions and millions in revenue, the debt would shrink, and everyone would be happy. It's not turning out that way.
Due to what many say is an already overburdening tax structure, clumsy state regulation and operation and other issues, many pot growers and sellers are already calling for reforms of the state pot system!
According to an in-depth report by The Islander online newspaper, the flood of money expected by I-502 hasn't happened, and it won't even come close to drawing down huge state deficits:
According to recent estimates, pot sales will generate $25 million in taxes by next year, with nearly $7 million of that going to the general fund. By the 2015-17 budget, businesses will pay about $206 million in taxes, then as much as $404 million by 2017-19, with $119 million in the general fund.
Those numbers are all nearly inconsequential in the face of the state's biggest challenges, including at least $3.5 billion needed to comply with a state Supreme Court ruling on K-12 funding, known as the McCleary decision.
"It's a very, very small portion," says Desiree Monroy, operations manager at the state's Economic and Revenue Forecast Council. "It's certainly not going to solve any of the woes that we read about."
Growers, processors and sellers (the state licensed stores) are being hammered by tax rates that often leave them with little money left over. Growers and store owners pay a 25% tax rate to the state. High overhead costs, taxes and other financial issues had led to thousands of complaints from consumers who aren't willing to pay $25 for a gram of the drug. Green Star Cannibus in Spokane officials report that nearly HALF the price of every item they sell in their store goes towards taxes...in other words, a 50% mark-up due to taxes.
Yield Farms, a state licensed pot growing operation, sees over 25% of the $12,000 a month they make growing marijuana go out the door in taxes. By the time they're done covering operational costs and other fees, they're left with about $1,500.
Sam Calvert, the owner of Green Star, is one of many pot industry people who are already saying "the system is broken."