Analysis: How legal recreational marijuana works in other states
As the Illinois General Assembly gets ready to debate recreational marijuana legislation, the Center for Illinois Politics breaks down how regulation works in other large states which have legalized the practice.
When Illinois lawmakers return to Springfield this week from their annual spring break, they're likely to take up the issue of decriminalizing adult recreational marijuana use as one of their first issues.
Ten other states and the District of Columbia currently allow recreational marijuana use, in many cases infusing their budgets with hundreds of millions of dollars per year. If Illinois becomes the eleventh, recreational marijuana could bring in as much as $170 million next year in new revenue from licensing cultivators and dispensaries, Gov. J.B. Pritzker's budget office estimates.
Lawmakers have spent recent weeks meeting in private working groups to hammer out various aspects of the legislation sponsored by Democratic state Sen. Heather Steans and Rep. Kelly Cassidy of Chicago. And Steans tells us it's likely to be filed later this week. Waiting for the details to be laid bare, the Center for Illinois Politics studied current practices in five large pot-legal states that feature a balance of urban, suburban and rural environments, from California to Massachusetts. Here's a look at where they stand on everything from growing at home to taxes and fees to minority business representation.
Can you grow your own?
California: Yes, a maximum of six live plants at home.
Washington: Only for medical use.
Colorado: Yes, a maximum of six live plants at home.
Nevada: Only if you live more than 25 miles from the nearest dispensary.
Massachusetts: Yes, one ounce outdoors or ten ounces indoors.
California is estimated to bring in $319 million from recreational marijuana this year, about $8 in revenue per capita from its 39.5 million residents.
Washington is expected to bring in $455 million this year - about $60 per capita in additional revenue for its 7.5 million residents.
Colorado is expected to bring in $265 million - an extra $47 a head for its 5.7 million residents.
Nevada is estimated to bring in $69.4 million - about $200 per capita from its 3 million residents.
Massachusetts (which is in the middle of its first fiscal year taxing marijuana) is expected to bring in between $44 and $82 million - about $6 to $12 in additional revenue per resident.
California features a cultivation tax of $9.25 per ounce of flower, $2.75 per ounce of leaves, and $1.29 per ounce of fresh cannabis. There is also a 15 percent excise tax - a tax levied on the purchase of a specific good - on any purchase of recreational marijuana. Application fees for retailers range between $135 and $8,700, annual cultivator license of $1,200 to $44,500.
The state of Washington has a 37 percent excise tax on recreational marijuana, plus state and local sales taxes of approximately 9 percent. Applications to grow and sell recreational marijuana are $250, and licenses are $1,480.
Colorado has a 17.9 percent sales tax, and a 15 percent excise tax. It costs between $2,700 and $4,500 for a retail license to sell recreational marijuana.
Nevada has a 15 percent excise tax on wholesale sales of recreational marijuana and a 10 percent sales tax on retail sales. Local sales taxes are also imposed. One-time application fees for retail licenses are $5,000. Licenses cost $20,000. Plus local sales tax; One-time application fee of $5,000 plus registration fee of $20,000 for a retail license.
Massachusetts taxes recreational marijuana with a 17 percent state tax (which is comprised of a sales and excise tax), and allows up to 3 percent local sales taxes to be levied as well. Application fees are $1,500, and license fees are $30,000.
Laws that encourage minorities who have been disproportionately affected by drug enforcement laws to participate in the cannabis industry are seen more often on a citywide than a statewide level, the Center has found.
In 2017, officials in Oakland, California approved a program that sets aside half of the city's marijuana business permits for low-income residents who were convicted of cannabis crimes during the War on Drugs.
Massachusetts' 2016 referendum question legalizing recreational marijuana included language to encourage participation in the recreational marijuana industry by those who were "disproportionately harmed" by drug enforcement laws. The Associated Press reported that city council member Ayanna Pressley has drafted proposed legislation that "would direct 20 percent of unexpended revenue from state and local marijuana taxes toward programs to assure racial equity, including efforts to reduce financial barriers to ownership of businesses." Additionally, the Massachusetts Cannabis Control Commission is looking into the possibility of establishing interest free loans for minorities to bolster participation from women- and minority-owned businesses, the Boston Business Journal reported.
In the state of Washington, officials have spoken about implementing a targeted outreach strategy to minority communities if they expand licenses in the future.
Bringing it home
In Illinois, Steans and Cassidy recently commissioned a two-part study on the adult-use recreational marijuana market in Illinois, which highlighted the need for Illinois to articulate clearly its expectations for legalization and the creation of a government body to oversee the industry.
Steans cites a primary goal of creating a legal marijuana market to “begin righting the wrongs caused by prohibition,” something she says she hopes will eliminate a black market for the goods, providing people instead with “a safe, regulated product.”
Details of the legislation haven't yet been released, but supporters has indicated it could include a maximum of five homegrown plants per household, and a portion of licenses being set aside for members in low income and minority neighborhoods.
The legislation is expected to be filed late this week. At the same time, 60 lawmakers from both sides of the aisle have signed onto state Rep. Marty Moylan’s resolution calling for the state to slow down the process “so that lawmakers, stakeholders, and experts alike have the chance to consider the societal impact of legalization and examine all the data from other states that have passed similar legislation.”
"Nobody's talking about what the harmful effects are," Moylan said. "I have Republicans, conservative Democrats, minorities, and women (lawmakers) with children who are signing on, saying, 'Marty, you're on to something, my (constituents) don't want this.'"
Illinois’ top issues
The Center for Illinois Politics is dedicated to providing you with clear, fact-based, non-partisan information on our state’s biggest issues.
IL Campaign Cash
Take a streamlined spin behind the scenes through Illinois’ biggest and most impactful campaign funds.
Illinois’ top issues
With elections behind us, it’s time to get down to business. The Center for Illinois Politics your resource for non-partisan information on our state’s biggest issues: