Residents of Washington, D.C. began early voting on October 25. One of the choices on their ballots is whether to approve Initiative 71. The ballot initiative would legalize marijuana for recreational use. With less than a week left to vote, however, the city isn’t waiting for the results to begin planning the next step.
The D.C. City Council held a hearing Thursday on the taxation and regulation of marijuana in the District. Unlike Colorado and Washington — states that legalized recreational marijuana sales in 2012 — District voters cannot use a ballot initiative to regulate and tax marijuana. Initiative 71 would decriminalize the possession of up to two ounces of marijuana and allow for cultivation of up to six plants, but sale would still be illegal. Regulation and taxation of the industry, valued by District financial officials at $130 million a year, is up to the Council.
“If the referendum passes on Tuesday, which I hope it does, the council will be in the position of having to set up a regulatory framework and taxing it will be part of that framework,” said D.C. Council member Jack Evans, a Democrat, who also oversaw Thursday’s hearing on the bill. [The Washington Times]
“When I introduced the Marijuana Legalization and Regulation Act in September of 2013, none of my colleagues were willing to be co-introducers [sic] or co-sponsors,” Council member David Grasso said at the hearing. Times have changed with council members now supporting marijuana legalization. The 2014 Legalization and Regulation Act proposes a 6 percent sales tax on medical marijuana and a 15 percent sales tax on marijuana “for all other purposes.” That 15 percent would bring in $19.5 million a year.
The $130-million valuation came from the District’s Director of Financial and Legislative Analysis, Yesim Sayin Taylor. He based it on an assumed 122,000 marijuana users buying three ounces of marijuana per year at $350 per ounce. It’s easy to see that possibility with D.C. being the only legal recreational marijuana market East of Colorado. With low application fees of $350 each for producer and retailer licenses, the market would be very open.
The Council has good reason to prepare themselves for Initiative 71’s passage. Public Policy Polling conducted a surveyof D.C. voters between October 20 and 22. A majority of 52 percent said that if the election were help today, they would vote yes. Even if the 13 percent still undecided join the 35 percent against, it would still lead to a 52 percent to 48 percent victory for recreational marijuana.
A separate question asked whether selling less than an ounce of marijuana should be permitted and taxed. With 43 percent in favor and only 12 percent against selling marijuana in any amount, it looks like the marijuana industry is coming to D.C. in a big way.