February 13, 2018

Advocates for marijuana sales point to big economic boost

Advocates for legalizing recreational marijuana use in Connecticut — and taxing its sales — are hoping a holistic, economic argument will win the day this year.

Supporters say the potential to bolster the state's tourism industry, create jobs, and even encourage young professionals to locate here, should attract votes for an issue that couldn't get a vote in the House or Senate in 2017.

And while Gov. Dannel P. Malloy has not proposed legalization or taxation, he did list it for the first time in his annual budget presentation — albeit as an "option" for those who don't like the budget-balancing moves he has endorsed.

"I do expect a robust debate this year," said Senate President Pro Tem Martin M. Looney, D-New Haven, although he conceded some lawmakers may steer clear of the controversial topic during a state election year. "I wouldn't say it (passage) is within the realm of probability, but it certainly is within the realm of possibility."

Looney, who proposed and helped secure passage of decriminalization of small amounts of marijuana in 2011, has been a vocal advocate for legalizing and taxing its sale, with tight regulations.

And things have changed in recent years.

Eight states now permit the sale of marijuana for recreational use. They are: Alaska, California, Colorado, Maine, Massachusetts, Nevada, Oregon and Washington.

Vermont recently legalized recreational use of home-grown marijuana. And while the states that permit and tax the sale of pot adopted those statutes by popular ballot, Vermont approved its new law through a vote of the legislature.

"Connecticut, the land of steady habits, no longer would have to worry about being the first state," said Sam Tracy, director of the Connecticut Coalition to Regulate Marijuana, the local affiliate of the Washington, D.C.-based Marijuana Policy Project.

And if Connecticut is paying close attention to its neighbors — particularly Massachusetts, which will permit sales of marijuana starting in July — it might see the economic impact of marijuana sales and taxation very clearly, Tracy said.

The coalition has proposed initially subjecting marijuana sales to the 6.35 percent base sales tax rate, and a 25 percent surcharge, with an estimated revenue gain to the state of $71 million in the first year.

But by 2020, the coalition is recommending Connecticut transition to a tax of $50 per ounce, plus the standard 6.35 percent sales tax rate.

By this point, revenue from sales tied to Connecticut residents alone is projected at $166 million, the coalition says, with the potential to develop a similar take from out-of-staters purchasing here.

Those revenue estimates are more aggressive than those produced by the legislature's nonpartisan Office of Fiscal Analysis back in February 2017.

OFA estimated that Connecticut could raise between $30 million and $105 million per year if the state were to adopt a model similar to those enacted in Massachusetts or Colorado.

A 2015 report the RAND corporation prepared for Vermont concluded the first northeastern state to legalize marijuana sales could realize significant revenue from the influx of tourists, according to the coalition.

With Maine and Massachusetts already approving sales, and with Vermont allowing home-grown use, Looney said his chief concern is that Connecticut's tourism market not lose ground.

"If we do not (legalize sales) and all of our neighboring states do, there is a negative tourism impact," Looney said. "I'm more worried about us losing a competitive advantage."

The coalition also estimates the cultivation, processing and retail work associated with marijuana sales could create thousands of jobs.

And a 2015 Harris poll found 11 percent of Americans said living in a place where marijuana use was legal was a factor they would consider when relocating.

Still, Looney conceded that the marijuana debate is not solely about the dollars it could raise for the state's coffers, or its potential impact on the economy.

Senate and House Democrats in Connecticut recommended the legalization, licensing and taxation of marijuana sales last May to help solve the state budget crisis.

Critics in the legislature argued again last year that marijuana can precipitate acute psychotic disorders among some users.

"Those are very disabling illnesses and may create a lifetime of disability for individuals," Rep. William A. Petit Jr., R-Plainville, said during last spring's House debate.

Rep. J.P. Sredzinski, R-Monroe, said at that time there is plenty of testimony from psychiatrists and other medical professionals who've established cannabis is addictive, and that a portion of recreational users will become dependent on the drug.

Some critics unfairly conflate marijuana use with opioid addiction "and the two are very different," Looney said.

As for other health care concerns, he added, "I think that we need to look at this in the same way we look at alcohol and cigarettes: legalize it but regulate it strongly."

Still, the Senate would not take up the measure last year, and House leaders held a debate only after agreeing that the matter would be tabled without a vote after 90 minutes of discussion.

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