Marijuana activists in Colorado were dealt a major blow this week when the words “marijuana repeal” were muttered by lawmakers.
Colorado residents voted to legalize the use of recreational marijuana this past November, but state lawmakers have not yet found a satisfactory way to regulate and tax the drug.
“That’s almost like saying to voters, ‘Vote for this, or else,’” said Colo. Sen. Cheri Jahn, (D-Wheat Ridge). “I don’t think you threaten voters like that. When over 55 percent of the people vote for something, I think we have to respect that.”
On Friday, the state House debated those two unsolved issues and proposed a tax on recreational marijuana of more than 30 percent. In addition to state and local sales taxes, there would be a 15 percent excise tax on retail pot and a 15 percent marijuana sales tax. But because of Colorado’s labyrinthine tax laws, voters must approve the pot taxes before they can be enacted.
Since the tax is so high, some lawmakers are suggesting that the question proposed to voters regarding the tax include an option to repeal the law altogether. The Colorado repeal effort wouldn’t apply to medical marijuana, but would affect the budding marijuana tourism industry that has begun to emerge in the state.
Friday’s shocking announcement comes as lawmakers from both parties expressed concern that Colorado won’t be able to afford to regulate recreational marijuana as expected. From labeling and potency standards to making sure pot taxes are collected, the regulatory scheme under consideration in Colorado wouldn’t be cheap.
As part of Amendment 64 — Colorado’s recreational marijuana legalization law — voters must approve taxes on the drug, but nothing is written in the law about what happens if voters don’t approve the new taxes. Lawmakers have long feared that if voters don’t pass a tax plan — which has the potential to generate tens of millions of dollars annually — regulation of the marijuana industry will be underfunded and ineffective.
The proposal was welcomed by lawmakers from both parties. Colo. House Speaker Mark Ferrandino (D-Denver) said he was open to the plan, adding it was “worth the conversation.” Senate President John Morse (D-Colorado Springs) also praised the proposal to repeal recreational legalization, saying, “I am absolutely supportive of the idea.”
But before lawmakers could get too excited, Rep. Frank McNulty (R-Highlands Ranch) said final language for a repeal proposal had to be agreed upon. McNulty says adding the threat of a repeal to a tax approval for marijuana forces marijuana advocates to get their “skin in the game.”
Lawmakers only have about 10 days left in the session to get marijuana policies and procedures in order.
Reaction to the “R” word
As discussion about repealing the law broke out at the capitol, Colo. Rep. Dan Pabon (D-Denver) vocalized concern that the repeal would undermine good-faith efforts to regulate marijuana.
Other lawmakers agreed with Pabon and said the proposal to repeal marijuana or force voters to pay a high tax is blackmail.
After Friday’s announcement in Denver, there were back-to-back news conferences outside of the capitol by groups in support of and against legalization.
Mason Tvert is one of Amendment 64’s authors. He said, “the proposal to repeal Amendment 64 is extortion,” and was surprised some legislators were considering it.
“We want to nip it in the bud because number one, it’s not permissible, and number two, it’s an irrational approach to implementing the will of the voters with Amendment 64. It’s clear that the intent … is to prevent marijuana from being legal and being regulated and being controlled,” he said.
But Sen. Larry Crowder, (R-Alamosa), said the whole purpose of legalizing recreational marijuana was to raise money for education and other programs. “So if there’s no money, we shouldn’t have marijuana,” Crowder said.
Many lawmakers have proposed lowering the tax rates, saying that would likely get more voters on board. Tvert agrees and suggested a 10 percent sales tax. Tvert cited a poll Amendment 64 backers commissioned that shows 77 percent support in Colorado for that level.
Speaking to Mint Press News, Tvert cited a Colorado State University study that found a 10 percent sales tax would generate more than $60 million, which is double what representatives estimated it would cost to enforce regulations.
Many Republican lawmakers and marijuana advocates are concerned that high taxes on the drug may spark another black market and result in voters repealing marijuana. But in comparison to Washington state’s 75 percent tax rate, Colorado’s 30 some percent tax seems much easier on the wallet. There was not a debate surrounding the tax rate in Washington state, since the tax rate was included in the ballot measure.
In order to keep the historical law, Christian Sederberg, a member of Colorado’s marijuana task force, has proposed alternatives to the high taxes, such as funding marijuana enforcement with licensing fees on the industry or operators’ fees levied by local government.
A battle between special interest groups
After Smart Colorado and Tvert held their separate news conferences weighing in on the repeal proposal, there was a lot of finger-pointing at who was behind the idea to reinstate marijuana prohibition.
In regard to the repeal proposal, Mint Press News was issued the following statement from Smart Colorado spokesman, Eric Anderson. He told Mint Press News that marijuana advocates like Tvert should fact check before issuing “midnight press releases” blaming groups like Smart Colorado for repeal being a possibility.
In an interview with Mint Press, Tvert said he didn’t blame Smart Colorado for the proposal, but highlighted that the group’s lobbyist, Mike Feeley, admitted last week that he had been pushing for a repeal proposal. “Whether [Smart Colorado] developed it or not,” Tvert says the group is “willing to say and do anything to make marijuana illegal.”
“Amendment 64 backers sold the ballot issue to Colorado voters as a way to pay for state priorities like education, but increasingly it’s looking like it could be a net drain on the state budget,” Anderson said. He added that if voters don’t approve new taxes on marijuana, Colorado’s budget will take a major hit and Amendment 64 will have exactly the opposite effect from what was promised to voters.
“The legislators suggested a simple, two-part proposal. Colorado voters would first decide whether to authorize a tax regimen developed through discussions over the past several months. Should the tax measure pass, the marijuana industry would come closer to covering its regulatory costs.” Anderson stressed that ultimately the decision to repeal or not would remain “in the hands of voters.”
But Tvert says the proposal would be entirely unconstitutional, since the law can only be repealed or re-examined in an even year, with the exception of tax provisions.
“Smart Colorado won’t say if they will support or oppose this tax,” he said, adding that it’s an incredibly disingenuous concept to argue that there be a special tax to cover the cost of enforcing regulations and then say there should be a repeal of Amendment 64 if there is not tax. He called the proposal a “built-in opponent” and said it was Smart Colorado’s way of trying to defeat the very tax it pushed for.
Is repeal a real concern?
Public support for marijuana is at an all time high — in April a study from Pew Research Center found that 52 percent of adults favor legalization. The numbers showed that for the first time in four decades of Pew polling that supporters outnumbered opponents.
But this past week was rough for marijuana activists. Gunfire broke out at Colorado’s annual 4/20 pot festival, leaving three injured. Then on Thursday, the Colorado Court of Appeals ruled that employers can fire workers for medical marijuana use, even if it is after work hours.
With an arguably disastrous PR nightmare happening in Colorado, some members of the public may vote to repeal the law since the federal government doesn’t appear to be backing down from its threat to sue Colorado for legalizing a drug the federal government recognizes as illegal.
The Obama administration has yet to announce it’s official stance, but since last November, the U.S. has received international pressure, including from the U.N., to force Colorado and Washington to end their recreational legalization policies.
But if you ask Tvert, he says the federal government’s silence is a positive thing. He told Mint Press News that the government’s silence can only be considered their approval, since if they were against it, they would have said something by now.