Colorado officials say that an astonishing $70 million worth of recreational marijuana has been sold in retails stores across the state in the first four months of 2014.
But economists in the state are bummed, saying that they were hoping for so much more from the nation's first big hit of legal retail recreational weed.
According to a recent state report, tax revenue from recreation marijuana sales in Colorado is lagging way behind expectations as economists now expect sales and excise taxes on retail cannabis to total around $30 million for the 2014-15 fiscal year - or less than half of the $67 million that economists first predicted in 2012.
The reason appears to be simple: medical marijuana is a lot cheaper—and savvy shoppers know it, purchasing nearly $133 million in medical pot in the first four months of the year alone.
(Yes, you read those figures correctly. Combined legal marijuana sales—both recreational and medicinal—in Colorado in the first four months of 2014 totaled over $200 million. That's a lot of damn weed! Another fun fact: As of May 1, there were 9,641 licensed marijuana industry workers in Colorado, or roughly the same number of law enforcement officers in the state.)
According to Colorado state law, medical marijuana is only taxed at the state's regular 2.9 percent sales tax rate, as opposed to recreational weed which is taxed an additional 25 percent on top of the regular sales tax.
In addition, the cost of a medical marijuana "red card" in Colorado has dropped from $35 to $15 per year, and—provided that you're a Colorado resident—are pretty easy to obtain.
But legislative economists say that they weren't expecting so many adult residents to stick with their red cards:
"We sort of expected that the adult-use (recreational) market would cannibalize the medical marijuana market," legislative economist Larson Silbaugh told lawmakers last week. "So far, there isn't any evidence that the medical marijuana market is sort of shrinking with people going to the adult-use market."
(Most of the Coloradoans I know who smoke weed—and no, not everybody in Colorado smokes weed—still get it from an old-fashioned dealer and leave the expensive retail stores to the rookies and tourists.)
So does this mean that legalized recreational marijuana is a bust? Well, while that $30 million in tax revenue may not be as much as the state had hoped for it's still $30 million more in tax revenue (much of it to be spent on K-12 education infrastructure) than they would have had if recreational pot was still illegal.
But officials say that some changes in state law—including a crackdown on how medical marijuana cards are handed out—may be needed to nudge some current medical marijuana customers back out into the recreational market.
Image via MJguide.com