The potential for government revenue is one argument people make in favor of commercializing marijuana. But in Alaska, is it true? Or do the resources spent on regulating marijuana outweigh the money coming in?
Let’s take a walk through the numbers.
From October through the end of June, 1,857 pounds of marijuana and 1,099 pounds of trim were sold wholesale, according to the Alaska Department of Revenue’s tax division.
Together, those pounds of pot generated $1.75 million through the state’s excise tax for fiscal year 2017, which ended June 30.
Monthly revenue is expected to continue to climb — especially at the end of the summer, when outdoor growers chop down their harvests.
But in terms of balancing budgets, the state’s excise tax is only part of the story.
The Alcohol and Marijuana Control Office regulates Alaska’s cannabis industry, and its budget for this new fiscal year is around $1.9 million for marijuana regulation.
The intent is that, eventually, marijuana business fees will fully fund the agency — the same as alcohol.
In the meantime, general fund money is being used to make up the rest as the cannabis industry slowly moves forward.
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For fiscal year 2018, marijuana regulation was budgeted $1.1 million from the state’s general fund. The remaining $800,000 will come from money collected on fees, according to Erika McConnell, the agency’s director.
Total fees were actually higher — $1.3 million collected for fiscal year 2017 — but some money goes back to local governments, and any money not spent will roll over into later years, McConnell said.
All told, from 2015 to June 2018, $4.57 million has been budgeted from the state’s general fund to regulate