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Weed News
MEDICAL MARIJUANA MEANS $39M FOR MISSOURI VETERANS COMMISSION
THE TAX ON YOUR WEED IS NOT GOING TO WASTE
By Jessica Rogen on Tue, Oct 31, 2023 at 11:45 am
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Lindsey Fox/FLICKR
Funds from the state's medical and recreational cannabis program are benefiting
the Missouri Veteran's Commission.
For Missouri veterans, the state's marijuana programs are looking a lot like
green gold.
As of today, the Department of Health and Senior Services has transferred more
than $29 million from Missouri's medical marijuana program to the Missouri
Veterans Commission since the program's inception in 2018. Today alone, DHSS
moved $13 million such funds from the medical program.
"These funds will help MVC continue to support the existing infrastructure of
our seven Veterans Homes," said Executive Director Paul Kirchhoff in a
statement.
In addition, DHSS transferred $3.8 million in funds from the recreational
cannabis program to three recipient agencies — the veterans' commission for
health care services, Missouri's State Public Defender for low-income legal
assistance and a DHSS-run drug addiction treatment program.
The funds come from the voter-adopted Constitutional Amendment 2, which
established the medical program, and Constitutional Amendment 3, which legalized
adult use.
All the fees and taxes from the medical program, minus expenses, are being
issued to the veteran's commission. On the recreational side, fees and the 6
percent tax, less expenses, are split among the three aforementioned programs.
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FBI SHOWS A 58 PERCENT DECREASE IN THE SHOW ME STATE SINCE 2016
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SPAT OVER LEGALITY OF STACKING CANNABIS TAXES IN MISSOURI BURNS HOT: “WE’RE
STANDING UP FOR THE WILL OF THE VOTERS," SAYS JACK CARDETTI, MOCANNTRADE
SPOKESMAN
RELATED
INSIDE THE GROWING PROFILE OF A MISSOURI CANNABIS CARETAKER: SEAN GARRISON
A.K.A. CAPTAIN MO GREEN HAS FORGED A CAREER IN MISSOURI’S CANNABIS INDUSTRY BY
GROWING FOR PATIENTS AND THROWING POT-THEMED PARTIES
Email the author at jrogen@riverfronttimes.com
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TAGS:
* medical marijuana,
* veterans,
* DHSS,
* recreational cannabis
ABOUT THE AUTHOR
JESSICA ROGEN
Jessica Rogen on Twitter
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Jessica Rogen is managing editor for the Riverfront Times. Send her your food,
arts, film, theater, music and other culture happenings.
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Weed News
APPLICANTS FOR MISSOURI CANNABIS MICROLICENSES WERE RECRUITED ON CRAIGSLIST
OUT-OF-STATE INTERESTS FLOODED THE MARKET FOR MISSOURI'S 'SOCIAL EQUITY'
CANNABIS LICENSES — SOME USING DUBIOUS TACTICS
By Rebecca Rivas on Fri, Oct 27, 2023 at 8:34 am
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REBECCA RIVAS/ MISSOURI INDEPENDENT
Cannabis microbusiness licenses are designed to boost opportunities in the
industry for businesses in disadvantaged communities, but some entrepreneurs set
out to take advantage of the opening.
James Harnden has been a longtime activist for cannabis legalization, ever since
he got slapped with a low-level felony possession charge for having an ounce of
weed.
The 56-year old Rockford, Illinois, resident says that charge has cost him job
opportunities for 30 years.
Earlier this year, he saw an advertisement in the Craigslist “gigs” section
posted by a Michigan cannabis real estate group called Canna Zoned MLS. It was
looking for “partners who qualify as a social equity applicant” to participate
in Illinois’ lottery to award cannabis business licenses that are, in part,
meant to benefit people impacted by marijuana criminalization.
“I spent most of my life applying for jobs and not getting them,” Harnden said.
“So I’m like, ‘Okay, so maybe one of these licenses will swing my way.’”
The Craigslist ad read: “If you are eligible and provide the required
documentation, we will give you $2,000, just for helping us submit the lottery
application! If we win the lottery and secure a license, we will give you an
additional $20,000!”
Harnden says what he didn’t realize was that he signed a contract agreeing to
hold 100 percent ownership interest on the application, but that he wouldn’t get
revenue or profits from the business. After the business passed through all the
state and municipal approvals, the contract stated that Harnden would be
required to sell his share of the business for $1 to the group or be held in
breach of contract.
The contract also authorized the group to enter Harnden’s information into
lotteries for social equity cannabis licenses in other states — and that’s how
Harden says he got paid $500 to be part of the lottery for Missouri’s
microbusiness license program.
Harnden was eligible to apply in Missouri because of his marijuana charge, which
is among seven eligibility categories that also includes living in census tracts
with high poverty and unemployment rates. Canna Zoned’s Jeffrey Yatooma is
listed as the “authorized agent” on the contract Harnden provided to The
Missouri Independent, leaving a space for his signature at the bottom.
Yatooma secured two of the 16 social equity cannabis licenses — in Columbia and
Arnold — issued earlier this month, according to information obtained by The
Independent through a public records request. Those records show Yatooma is
listed as the “designated contact” for 104 out of the 1,048 applications for
dispensary licenses in Missouri’s lottery.
Yatooma’s group was not the only one using the strategy of flooding Missouri’s
lottery with applications to obtain a dispensary license. An Arizona-based
consulting firm is connected to more than 400 dispensary applicants, including
six winners, and a Missouri firm is connected to more than 80 applicants and two
winners. Both said their clients did not advertise or promise payment for
submitting applications.
In at least three states holding lotteries for social equity cannabis licenses
this year — Illinois, Maryland and Missouri — Yatooma’s group has offered to pay
eligible people up to $2,000 to apply on their behalf and $20,000 more if they
won.
While the Craigslist ads posted in Missouri can no longer be seen online, a
screenshot of a similar ad posted by Canna Zoned in Illinois was included in a
story by the Chicago Sun Times. Ads are currently up in Maryland, where the
state’s social equity cannabis application opens on Nov. 13.
Provided with a copy of Harnden’s agreement, Yatooma said his company “never
signed any agreements along the lines of the one you mentioned.”
He said that the agreement was part of “early business discussions.” Yatooma’s
group made a similar argument earlier this year when efforts to secure licenses
in Illinois faced criticism.
“The parties never moved forward with the referenced document, and the state
subsequently provided guidance advising on how to structure partnerships,”
Yatooma said in an email to The Independent. “In our experience with new laws,
it is frequently important to begin business discussions and then be prepared to
pivot — and finalize a partnership when new state guidance is announced.”
Yatooma also said he’s aware the microbusiness dispensary licenses “must
continue to be majority owned by an individual who meets at least one of the
eligibility qualifications” outlined in the constitution.
Voters approved the microbusiness program last November as a provision in the
constitutional amendment that legalized recreational marijuana.
Nimrod Chapel, an attorney and president of the Missouri NAACP, reviewed the
agreement signed by Harnden and provided to The Independent. He believes it
“defrauds the state” because it gives the eligible applicants no voting or
financial interest, in violation of the state’s constitution.
“The very people who were victimized by cannabis laws in the first place are yet
again on the losing end of what appears to be a distinctly inappropriate power
grab,” Chapel said.
Yatooma said he rejects “any allegations that we have defrauded the state.” Any
final agreements with partners in Missouri, he said, “will absolutely comply
with all state laws and regulations.”
Lisa Cox, spokeswoman for the Missouri Division of Cannabis Regulation, did not
say whether or not the division had seen the agreements between Yatooma and the
applicants.
However, she said such an agreement will be reviewed as part of the
post-licensure verification process, where the division will “determine whether
any microbusiness applications were false or misleading and to ensure all
microbusiness licenses are majority owned by eligible applicants.”
That process will be completed by the end of the year, she said.
If the state takes no action to revoke Yatooma’s two licenses, Chapel said the
Missouri NAACP would consider litigation to obtain a cease and desist order on
the entire microbusiness program.
“If [the division] were to look at the agreements — that show the applications
are not true — and they don’t take some action against these licenses,” Chapel
said, “then I think that they would be totally complicit in a fraud.”
In response to the NAACP, Cox said the division will revoke the license if it
“determines the applicant provided false or misleading information in the
application.”
click to enlarge
RUDI KELLER/ MISSOURI INDEPENDENT
Jeffrey Yatooma, who is with the Michigan cannabis real estate group Canna Zoned
MLS, is the designated contact for a winning microbusiness dispensary license,
where the proposed location of the shop is 700 Vandiver Dr. in Columbia.
A PATTERN AND PRACTICE
Simone Booker, a 52-year-old Chicago resident who works in tax preparation,
remembers sitting down with an attorney for Canna Zoned, Amanda Kilroe, this
spring at Starbucks to talk about a “great business opportunity.”
Kilroe’s number is currently listed on the Craigslist ads in Maryland, and she’s
who responded when The Independent called the number.
However, Booker never saw a Craigslist ad. She was referred to Kilroe by a
friend and never received $2,000 for applying.
The phone number on the Craigslist ad belongs to Amanda Kilroe with Michigan
real estate group Canna Zoned MLS.
“She’s a wonderful person,” Booker said of Kilroe. “I have met a few people
[from Canna Zoned]. They are absolutely wonderful people. So that was the
impression I got from them.”
Booker remembers asking Kilroe multiple questions about what her commission
would be and what percent of the profits she would get. She said Kilroe assured
her that she would be seen as a “social equity partner” and would get a share of
the profits at every fiscal quarter.
Then after a year, Booker would agree to sell her shares of the company for an
amount that “we would work out later,” she says Kilroe told her. They talked
about how Booker could potentially make $200,000 before she sold her shares, and
she could also choose to buy back into the business later if she wanted.
Booker says she now realizes she didn’t read the contract’s fine print closely
because Kilroe seemed so trustworthy and professional.
Booker said Kilroe never mentioned the contract would force her to sell her
shares for $1. And Kilroe’s description of the partnership, Booker said, was
“completely different” than what she signed — that she agreed to receive “no
disbursements” other than the $2,000 to apply and the $20,000.
More specifically, she’d get $10,000 after the municipality where the dispensary
is located approved the location, and another $9,999 after the state approves
the license and she transfers her ownership of the business.
Booker was shocked to find these provisions in her contract when asked about
them by The Independent.
“I’m completely blessed that God didn’t approve this business,” Booker said. “I
would have never signed the contract… not even for the $20,000 because $20,000
is not worth the millions that they’re going to make off of my name.”
Kilroe did not respond to The Independent’s requests for comment.
Booker fears for the other people who don’t realize what they signed. Having a
tax background, she knows how to fill out the paperwork to ensure the group
can’t use her name for an federal tax identification number (EIN) in the
future.
The contract authorized the use of her Social Security number for an EIN,
meaning she would be completely on the hook for tax liability of the business
even though the contract claims otherwise, Chapel said. But other people don’t
know how to do that, she said.
“Their name is going to be forever used for business, but they’re never going to
profit,” she said.
Chapel said he’s never seen a contract like it.
“This agreement is wide ranging, not limited in time,” he said. “It’s not clear
when — I guess at death — you would be released.”
It’s essentially agreeing to let the company use their “likeness” and name
indefinitely, he said.
“How is this not literally buying at least a piece of a person?” he said.
A PUBLIC WARNING
Kilroe told the Sun Times that Canna Zoned “didn’t end up moving forward” with
any of the respondents to the ad, after the newspaper reached out to her about a
similar agreement the group made with a gun-violence victim.
“We didn’t enter the game in Illinois,” Kilroe told the newspaper.
However, Yatooma’s group was behind at least 20 dispensary applications in
Illinois under variations of the name “Chicago Retail LLC,” including Booker’s
and Harnden’s, according to state business records. Chicago Retail LLC wasn’t on
the state’s list of winners released on July 13, but it’s unclear if Yatooma
came away with a license in Illinois.
Chris Slaby, spokesman for the Illinois Department of Financial and Professional
Regulation, which oversees the social equity program, said the state’s cannabis
law prohibits him from disclosing if Yatooma obtained a license.
The department was aware of posts like the Michigan group’s and issued a public
warning in February to potential applicants about the dangers of these types of
agreements, Slaby said in an email to The Independent.
Illinois conducted its lottery on July 13, and the department is currently
assessing the winners’ eligibility. Slaby said it “may deny a license in the
event it determines any false information was used to apply.”
Booker’s contract appeared to be identical to the one Harnden signed in
Missouri.
Both stated that Yatooma’s group can use the applicants’ information in any of
the other states lotteries for social equity cannabis licenses, and the group
recently contacted Booker again about entering the next lottery in Illinois.
At the end of July, Harnden was notified that the group was entering his name in
the Missouri lottery, which was conducted on Aug. 28.
The Missouri contract is with a Michigan limited liability company called
“Report Head LLC,” but Yatooma is the authorized agent listed on the contract.
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Adolphus Pruitt, president of the St. Louis City NAACP chapter, also reviewed
the agreement and said it establishes up a “modern-day indentured servitude.”
Pruitt agrees with Chapel that the Michigan group is defrauding the state, as
well as putting the applicants in that position whether they know it or not. The
St. Louis City NAACP chapter, he said, would support the state NAACP’s move to
get a cease and desist order.
“It appears that it was never the intent for the ‘social equity partner’ to own,
operate, nor benefit from the micro license as envisioned by the voters,” Pruitt
said.
click to enlarge
COURTESY CB ADVISORS
Sara Gullickson, founder and CEO of the Phoenix consulting firm Cannabis
Business Advisors, is the designated contact for six of the 16 microbusiness
cannabis licenses issued in Missouri in October 2023.
FLOODING THE LOTTERY
Sara Gullickson, founder and CEO of the Phoenix consulting firm Cannabis
Business Advisors, is the designated contact for six of the 16 microbusiness
cannabis licenses issued in Missouri on Oct. 2, 2023 (Photo courtesy of CB
Advisors).
Of the 16 winners of dispensary licenses, only five appeared to have submitted
just one application — meaning they didn’t make agreements with eligible people
to apply on their behalf.
On Oct. 2, the state issued 48 microbusiness licenses in total — six winners in
each of Missouri’s eight Congressional districts.
In each district, two were microbusiness dispensaries, and four were
microbusiness wholesale facilities — where the owners can grow up to 250 plants.
According to records obtained by The Independent, the wholesale side — where
there was 577 applicants total — did not appear to see the same kind of flooding
strategy as for dispensaries, which had total of 1,048 applicants.
As far as finding multiple eligible applicants to apply on one person’s behalf,
Yatooma’s operation was not the biggest. And he only applied in half of the
state’s eight congressional districts — the 2nd, 4th, 5th and 6th.
A Phoenix cannabis consulting firm, Cannabis Business Advisors, is listed on 42
percent of the applications for dispensary licenses. And they are the designated
contact for six of the 16 winning licenses.
In every congressional district where the firm’s clients won a dispensary
license — including the 1st, 2nd, 4th, 5th 6th and 7th — its president, Maxime
Kot, is the contact listed on between 40 percent and 60 percent of the
applications in that district.
For example, in the 1st Congressional District — which encompasses the City of
St. Louis – Kot was listed as the contact person for 76 dispensary applications,
making up 62 percent of the total submitted. In the 2nd District, it was 63
percent and in the 4th, 53 percent.
When asked how CB Advisors was able to find that many eligible people to apply,
Sara Gullickson, founder and CEO of the firm, said: “As far as our intellectual
property and how we submit applications — either lottery or merit based —
obviously that’s the secret sauce of the company.”
However, after hearing about Yatooma’s strategy of posting Craigslist ads and
paying applicants, she said that was “not our business model.”
“We’ve probably worked in 30 states and five countries,” Gullickson said. “I’ve
been at this since I was 26 years old. I’m now 40 years old. I’ve just been
around for a while.”
Gullickson has a stake in several cannabis licenses across the country that are
minority- or women-owned. But in Missouri, she was acting as a consultant, she
said, and wasn’t vying for a license herself.
When asked how many of the applicants are from out of state, she said that she
didn’t want to disclose the information.
John Payne, founding partner at Amendment 2 Consultants, acted as campaign
manager for both of the constitutional amendments to legalize medical and
recreational marijuana in the state. He’s listed as the contact for 16 percent
of the dispensary license applications statewide, including two winners — both
in the 3rd District.
One of his winning clients applied with just one application, records show and
Payne confirmed. The other had 68, which Payne said the person pooled with
friends and associates to work together to apply and to get a license.
Like Gullickson, Payne said also he didn’t advertise or offer payment like
Yatooma.
“It was almost all internal networks,” Payne said. “We knew a lot of people and
those people knew a lot of people. So that’s how we kind of grew our client
base.”
Payne said any questionable agreements made as part of the microbusiness license
application process should come out in the next couple months, during the
state’s post-licensure verification process.
“The department does a pretty thorough job of vetting these sorts of things,”
Payne said. “They do ask for your operating agreements and contracts that you’ve
signed, so that could be something that they look into.”
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LICENSES WILL BE ISSUED IN 2024 AND 2025
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This story originally appeared in the Missouri Independent.
Missouri Independent is part of States Newsroom, a network of news bureaus
supported by grants and a coalition of donors as a 501c(3) public charity.
Missouri Independent maintains editorial independence. Contact Editor Jason
Hancock for questions: info@missouriindependent.com. Follow Missouri Independent
on Facebook and Twitter.
Subscribe to Riverfront Times newsletters.
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TAGS:
* medical marijuana,
* veterans,
* DHSS,
* recreational cannabis
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Weed News
MISSOURI CANNABIS POSSESSION ARRESTS HIT A 28-YEAR LOW IN 2022, FBI SAYS
THE FBI SHOWS A 58 PERCENT DECREASE IN THE SHOW ME STATE SINCE 2016
By Monica Obradovic on Fri, Oct 27, 2023 at 6:04 am
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SHUTTERSTOCK
In St. Louis city, cannabis possession made up 14.7 percent of 644 drug
possession arrests in 2022.
Arrests for marijuana possession in Missouri reached a 28-year low in 2022, but
marijuana possession still accounted for nearly half of all drug arrests in the
state, according to new FBI data.
Out of 20,829 arrests across the state for drug possession in 2022, 8,863
arrests were for marijuana possession. While weed advocates say that number is
too high, the FBI’s annual log of marijuana arrests hasn’t been that low since
1994, when the agency reported that Missouri law enforcement completed 7,237
arrests for marijuana possession.
Compare that to the 2010s, when arrests for marijuana possession soared. In
2016, the FBI logged 21,568 arrests for marijuana possession in Missouri. That
figure would drop by 58 percent in fewer than six years.
As that’s happened, data shows that overall drug arrests in Missouri have
declined. In 2021, however, the number of arrests for “dangerous nonnarcotic
drugs” — which the FBI's website defines as barbiturates and Benzedrine —
surpassed those for cannabis.
The FBI released its data for 2022 earlier this month. While it can provide a
glimpse into crime trends through the years, its accuracy has been repeatedly
called into question as law enforcement agencies across the country (including,
notably, the St. Louis police) don’t consistently submit data.
The seemingly dramatic decrease reflects a seismic shift in Missouri’s
perception of marijuana.
“The short story is that public opinions about cannabis have been changing for
years,” says St. Louis-based criminal defense lawyer Joe Welch.
In 2014, the Missouri legislature updated the state’s criminal code to reduce
penalties for the lowest level of marijuana possession to be punishable only by
a fine, rather than jail time. Voters have since approved the legalization of
medical marijuana. And last December, another voter-approved constitutional
amendment, Amendment 3, took effect and legalized recreational weed.
Jack Cardetti, spokesman for the trade association MoCannTrade and lead
strategist on the legalization campaigns, attributes the decrease in arrests in
part to these measures.
“These dramatic drops in yearly arrests are both a function of the two
voter-approved constitutional amendments, as well as smarter public safety
policies that prioritize fighting serious and violent crime instead of using
finite law enforcement resources on cannabis possession,” Cardetti said in a
statement to the RFT.
Even before full legalization, local governments in Missouri started to chip
away gradually at War on Drugs mentalities and decriminalize cannabis in certain
amounts.
Efforts to decrease the penalties for possession began in St. Louis city in
2013, when aldermen voted to decriminalize cannabis and reduce $100-plus fines
to $25 at the most. In 2021, the city all but legalized small amounts of pot
with a bill that barred police from issuing citations for two ounces or less. A
year before, Kansas City’s legislative body voted to strip the city’s code of
penalties for marijuana possession.
Prosecutors also changed their outlook. A week after the medical marijuana vote,
Jackson County Prosecutor’s Office announced it would stop prosecuting most
marijuana possession cases. Two months later, St. Louis County announced the
same.
And two years into her tenure, former Circuit Attorney Kim Gardner said her
office was “hampered” by pursuing low-level cannabis offenses and would no
longer bring possession cases for small amounts.
Loosening the law’s grip on cannabis hasn’t necessarily meant justice all
around. The FBI’s crime data explorer does not show the demographics of those
arrested for cannabis possession, but other reports indicate laws have continued
to be disproportionately enforced on minority Americans.
A 2020 analysis by the American Civil Liberties Union concluded that Black
people were 3.64 times more likely than white people to be arrested for
marijuana possession even though their cannabis use was comparable. In Missouri,
the ACLU concluded Black people were 2.6 times more likely to be arrested for
marijuana possession than white people. An RFT analysis of St. Louis city
citations from 2013 to 2017 found equally big disparities.
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The FBI’s data also gives a glimpse into which law enforcement agencies in
Missouri enforce cannabis laws the most.
According to the data, 39.5 percent of St. Louis County Police’s 938 drug
possession arrests in 2022 were for cannabis. In St. Louis city, cannabis
possession made up 14.7 percent of 644 drug possession arrests.
Kansas City Police Department beat out all other agencies in the state's most
populous areas — only 5 percent of their drug possession arrests were for
cannabis.
But Welch, the criminal defense lawyer, points out that access to cannabis
affects how many people are arrested for it. The proliferation of cannabis
across the U.S. could be part of the reason why the 2000s saw so many more
arrests than in the 1980s and early ‘90s.
“Access to cannabis back then wasn’t as it is now,” Welch says.
The year 2006 appears to be the peak of cannabis arrests in Missouri. That year,
law enforcement agencies made 22,138 arrests for cannabis possession.
That doesn’t surprise Brennan England, founder of Cola Private Lounge and
president of Minorities for Medical Marijuana Missouri.
The West Coast’s cannabis market started to swell around that time, according to
England, and people started transporting weed from California.
“From 2005 to 2010, there was a huge explosion of good weed,” England says.
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ABOUT THE AUTHOR
MONICA OBRADOVIC
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Monica Obradovic is a staff writer for the Riverfront Times.
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REBECCA RIVAS/THE MISSOURI INDEPENDENT
Dyllan Davault, a harvester at Robust Cannabis facility in Cuba, Missouri, tends
to greenhouse plants on May 2, 2023. Robust is one of two cannabis companies to
sue over pot taxes in Missouri counties.
Legal recreational weed quickly became a booming industry in Missouri after
adult-use sales began in February. The first day of legalization alone brought
in $8 million. By the sixth month, Missouri started to outpace legacy cannabis
states such as Washington and Oregon.
As wafts of weed became more prevalent in every corner of Missouri, the state’s
counties and smaller local governments started smelling a different kind of
green. Money.
In April, voters in dozens of Missouri counties passed a 3 percent county-wide
tax on cannabis that stacked on top of the taxes levied by cities. The stacked
taxes were immediately problematic as it was unclear if they were legal. Now,
two recent lawsuits are challenging just that.
The question comes down to wording in Amendment 3, the constitutional amendment
that paved the way for recreational weed. Yet, the reason for the wording
becomes clear when you look at how other states have handled their pot
industries.
Some states, such as Illinois, have levied exorbitant taxes on marijuana, and
their industries have faced setbacks. Just look at Beyond Hello across the
river, which has suffered significantly as Missouri stoners opt for home-state
dispensaries that are cheaper, even after patronizing Illinois’ dispensaries for
years. California and Illinois’ black markets thrive because of the states’ high
pot taxes. For Illinois, nearby Michigan’s lower taxes don’t help the state’s
market either.
“We’ve seen over and over again from other states that when you tax the sale of
cannabis too high, you’re just pushing people to the illicit market,”
MoCannTrade spokesman Jack Cardetti says.
So drafters of Amendment 3, now Article 14 of Missouri’s constitution, tried to
lay out provisions to prevent high taxes. “Local governments” can add no more
than a 3 percent tax on recreational pot in addition to a 6 percent state tax.
And though the state’s constitution defines “local government” as “an
incorporated area, a village, a town, or city and, in the case of an
unincorporated area, a county,” counties are trying to gather a 3 percent tax on
recreational sales in incorporated areas.
That means if you bought edibles from a dispensary in Berkeley, an incorporated
area in St. Louis County where voters approved a 3 percent tax, you’d have to
pay the city’s 3 percent tax on top of the county’s 3 percent and the state’s 6
percent.
If that sounds like a lot, that’s because it is. It’s still less than Illinois,
however.
“In most instances, Missouri taxes will still be lower than they are in
Illinois, but it definitely cuts into that price advantage,” Cardetti says.
The legality of the new counties’ taxes was supported by the Missouri Department
of Revenue, who, in February, walked back guidance it issued earlier that month
that said taxes could not be stacked in incorporated areas. The move shocked
Missouri’s cannabis industry.
One lawsuit filed by Robust Missouri Dispensary in Florissant, where consumers
pay a whopping 14.98 percent tax, asks the court to rule that the constitution
does not authorize counties to collect a recreational weed tax in incorporated
areas. Greenlight Dispensary in Ferguson filed a similar suit.
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Steve Hobbs, executive director of the Missouri Association of Counties,
believes Amendment 3’s authors didn’t understand how some cities and counties
work here.
“In Missouri, cities reside within the county,” Hobbs says. “After talking with
our general counsel, we believe that counties absolutely have the ability to put
that on the ballot, and local citizens can decide if they want to tax marijuana
or not.”
Legal or not, marijuana would be an easy revenue source for counties. Doug
Moore, chief communications officer for St. Louis County, says a tax on
recreational marijuana would roughly bring $3 million to the county each year.
That money would go to the county’s general fund, according to Moore — and would
make a small dent in its $25 million budget deficit.
Hobbs says counties should get tax income because they’ll shoulder the
responsibility of “drug treatment programs” that he believes will coincide with
the legalization of marijuana. Plus, 3 percent is not the most substantial tax,
he says.
“We don’t really have a way to estimate how much that money will be, but I don’t
think we’re talking about millions and millions of dollars for any one county,”
Hobbs says. “But the simple fact is, most of the treatment issues or social
economic programs and the effects that go along with legalizing marijuana are
going to be borne by the counties. Most of the drug treatment programs or any of
the law enforcement stuff is done by counties.”
It bears pointing out that the marijuana legalization has not been found to
increase arrests or place additional burdens on law enforcement, according to
the federal Office of Justice Programs.
“We’re standing up for the will of the voters,” Cardetti says. “When Missouri
voters passed Amendment 3 last November by a margin of 127,000 votes, they
expected a 6 percent state tax and a 3 percent local tax. The counties have gone
and done something the voters never anticipated and is absolutely contrary to
what’s in the Missouri constitution.”
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TAGS:
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* DHSS,
* recreational cannabis
ABOUT THE AUTHOR
MONICA OBRADOVIC
Monica Obradovic on Twitter
Email Monica Obradovic
Monica Obradovic is a staff writer for the Riverfront Times.
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