Marijuana Legalization In Arizona Promises $40M In Education Tax Dollars, Reality Not That Simple

Published: Thursday, September 10, 2015 - 4:18pm
Updated: Thursday, September 10, 2015 - 6:03pm
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Signatures are being gathered throughout the state for a proposed ballot initiative that would legalize the recreational use of marijuana in Arizona.

Proponents promise that taxes from the measure could provide at least $40 million annually for education.

Backers of the measure, known as the Initiative to Regulate and Tax Marijuana Like Alcohol, say they’ve already gathered more than a third of the signatures and expect it to appear on next year’s November ballot.

Scottsdale businessman J.P. Holyoak is leading the effort.

“I’m wearing a business suit, which I typically wear on most days. I’m an unapologetic conservative Republican. And it wasn’t that long ago that I was an anti-marijuana  person.”

But, he said something changed his life.

“My first daughter was born, and she was a special-needs child. She was having seizures every single day, between 25 and 35 seizures every single day lasting 8 to 12 minutes.”

Holyoak said his daughter Reese, now 6-year-old, was diagnosed with Aicardi syndrome, a rare genetic syndrome that affects the brain and triggers seizures. Nothing worked, until he got desperate and tried cannabis oil.

“We took that leap; we tried it, and it worked. It has eliminated her seizures. She has gone from being unable to stand on her own two feet, to walking independently.” Holyoak said. “She is now feeding herself. She smiles, laughs and plays every day, things she didn’t do prior to marijuana.”

Medical pot passed in Arizona in 2010 and has worked for his daughter, but why take the leap to legalize it for recreational use?

“Prohibition of marijuana has failed, and it makes sense for us to tax and regulate the sale of marijuana with the proceeds benefiting education, rather than continuing to arrest otherwise innocent individuals who are consuming a substance that’s objectively safer than alcohol.”

Not so fast, said Yavapai County Attorney Sheila Polk, who has long opposed pot legalization of any kind.

“You know the question isn’t which is more harmful. The question is, are we better off as society by legalizing an illegal substance?”

Polk said science points to marijuana’s negative effects on the brain, especially the developing minds of children.

“Legalizing a substance so that you can get money, while ignoring the negative public health consequences of the substance itself, particularly on our kids and their education, really is just a silly, bad choice,” Polk said.

Holyoak and others advocating for the initiative have gotten involved in the medical pot business and stand to benefit if it's legalized for recreational use.

Polk said therein lies the real motivation.

“What's written in to this initiative is the opportunity for certain groups of folks to make a lot of money off the commercial, for-profit sale of marijuana.”

The measure though, does call for a 15 percent “sin” tax on marijuana that proponents say would help pour more than $40 million annually into the state’s education budget. For comparison, Colorado made the recreational sale of pot legal in 2014.

“All told, what we like to say is that the sky has not fallen,” said Skyler McKinley, deputy of Colorado’s Office of Marijuana Coordination.

But McKinley said, profits aren’t falling out of the sky either, and it would be a mistake to legalize marijuana by marketing it as a windfall for education.

“To date, the state of Colorado has brought in about $120 million from the sales of recreation and medical marijuana. That sounds like a lot of money. It sounds like a meaningful amount of money. But then, consider the fact that education outlays alone are about $5.6 billion. So, we’re talking about a drop in the bucket.”

It would be a slightly larger drop in Arizona’s smaller education bucket, where the budget totals only $3.8 billion. Colorado taxes pot at 10 percent, 5 percent below what’s being proposed in Arizona.

But in Denver, McKinley warns Arizona not to base the state budget on marijuana sales.

“When we talk about a sin tax or a vice tax that we have on marijuana or tobacco or alcohol, to really rely on that to fund schools, the pay teachers to pave roads, it creates this perverse incentive in government to want to use that vice, and that’s something you really want to avoid,” McKinley said.

Holyoak said his $40 million estimate is a conservative one.

“We’re looking at about $75 million that will flow in to Arizona’s coffers. Of that, 80 percent will go directly to public education here in Arizona. That number comes out to, you know, 80 percent of $75 million is about 60 million.”

Polk disputed those numbers and argued to let the smoke clear in Colorado first.

“What I’m saying to voters in Arizona is, let’s slow down and watch this grand social experiment play out in Colorado. Let Colorado experiment on their kids. Let’s not experiment on Arizona’s kids. And let Colorado gather the data.”

And even in Colorado, Skyler McKinley agreed.

“My best advice for Arizona frankly would be, hey, let’s not jump the gun on this. Let’s see how things are going in Colorado; how things are going in Washington State; how things are going in Alaska, all of which have different regulatory approaches, and take a step back and then make that determination.”

Assuming the Campaign to Tax and Regulate Marijuana Like Alcohol gets its required signatures, the measure will appear on the ballot in time for November of 2016.

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