Taxes generated by Colorado’s $1 billion marijuana industry are keeping some struggling towns solvent even as growing numbers of high-schoolers are getting stoned at lunch, police are coping with a doubling of cannabis-related traffic deaths and doped-up tourists flock to emergency rooms.
About 938 dispensaries, which outnumber Starbucks in Colorado, in 2015 yielded $135 million in state taxes and fees, 44 percent more than a year earlier. Yet as the market enters its third year after voters legalized retail sales in 2012, officials question whether the newfound income outweighs the escalating social costs.
“People here don’t really care for marijuana, but the sales tax from pot is helping us stay afloat,” said Richard Sprague, a town trustee in Empire, 42 miles (67 kilometers) west of Denver, where two dispensaries are replacing revenue lost after antique and convenience stores closed in 2015.
Colorado isn’t alone in making money off pot as it emerges from prohibition. In Washington, where advocates sold voters on legalization as a way to decrease local-government expenses, dispensaries generated $65 million in state taxes in fiscal 2015, about $6 million of which was shared with cities. California may legalize retail sales this year in a ballot initiative that could generate as much as $1 billion in new state and local levies.
Colorado’s legal pot is hard to contain. Sheriffs in neighboring states are overwhelmed by an influx of marijuana, according to a September report by a consortium of federal, state and local drug-enforcement agencies. The U.S. Supreme Court is reviewing a case filed by the attorneys general of Nebraska and Oklahoma against Colorado that argues drugs are spilling across state lines, burdening law-enforcement agencies.