Marijuana Cash Cow in Colorado Catches Chicago Alderman's Attention
CITY HALL — Could recreational marijuana be the revenue-generating industry Illinois needs to solve its budget woes?
Legalization proponents say yes, and one Chicago alderman is looking at the success of legalization in Colorado to get a conversation started here.
"Pot=$$$$," Ald. Joe Moreno (1st) tweeted Monday, linking to a story on tax revenue generated by recreational marijuana in just the first month of legalization in Colorado. According to NBC News, half of the state's 35 licensed retailers responded to a poll and said they had collected $1.24 million in tax revenue in January, some having been open just a handful of days.
Some estimated that Colorado could rake in $250,000 a day in February, or perhaps $100 million a year, well above the state's initial estimates of $67 million in revenue.
By contrast, Colorado makes $40 million a year from alcohol taxes.
Six months ago, after Illinois approved medical marijuana, Chris Bochenski predicted the conversation around marijuana legalization would get more revenue-focused. The Chicago business executive founded the Consortium for Compliance in North Center to encourage the expansion of legalization. Bochenski said success in states like Colorado and Washington would lead other states to take a fresh look at legalization, much as they have with legalized gambling.
"Once Illinois sees the roof doesn't cave in with medical, [and] because Illinois is $7 billion in the hole, the discussion is going to change," Bochenski said.
Bochenski pointed to how New Hampshire is now moving toward legalizing recreational use of marijuana.
"It diverts money from the black market into state coffers," Bochenski added. "It changes the discussion. Illinois needs a new billion dollar industry."
Moreno, however, isn't willing to go that far just yet. Though he is on record for supporting legalization, he is currently studying the impact of medical marijuana on attitudes in the state, according to his office.
"We have to figure that out and see how that goes and see where we can go from there," said Matt Bailey, Moreno's press secretary. He said the alderman has "nothing concrete right now" in the way of a new city ordinance, but "we're always open to new ideas."
Bochenski said polls show acceptance for legalization and pointed to President Barack Obama's recent comment that marijuana is safer than alcohol.
The key to expanding legalization, Bochenski said, is to make sure things go smoothly in Colorado and Washington and other states that legalize it. He cited U.S. Attorney General Eric Holder's position that the federal government will maintain a hands-off policy as long as states can prove compliance, such as no pot being sold to minors or transported to other states where it remains illegal. That, Bochenski said, is the mission behind the Consortium for Compliance, to make that case from state to state through technological data.
States like Illinois, he said, would simply want to emulate that success.
"They don't want to reinvent the wheel," Bochenski added. "They would rather adopt something that's working. And that's what I'm trying to do, take what's working and propagate that to other states."
Washington has a three-tier system for recreational marijuana, including producers, processors and retailers. It charges a 25 percent tax at each transaction level, from growing to processing to public sales, generating substantial revenue. Compounded, he said, "It's almost a 100 percent tax."
Despite the rosy revenue numbers, Bochenski doesn't expect acceptance to occur overnight.
"Talking about marijuana is like talking about abortion," he said. "Everybody has an opinion. They're not going to change it."