Regulate RI, a coalition working to tax and regulate the sale of marijuana in the state, yesterday made the business case for the idea, ahead the House Judiciary Committee taking public testimony on the bill.

Ray White, chief operating officer of the Thomas C Slater Compassion Center said that he has 60 employees at his business selling medical marijuana. If recreational marijuana were to become legal, he sees the opportunity to employ many more people.

In addition to retail outlets there is the opportunity for marijuana and hemp related research. Austin Davis and Spencer Blier both made the case for Rhode Island being an east coast leader in developing new products, including hemp ropes and boat sails. Along with the development of new products say these entrepreneurs, comes more jobs and more economic growth.

Fred Joyal, who developed and sold a successful business in California, is originally from Rhode Island and is looking to move back here. He is looking for investment opportunities, and feels that Rhode Island could be a leader, but only if our legislature chooses to move before Massachusetts passes similar tax and regulate legislation as a ballot initiative.

This relates to the first mover argument. The first state in New England to tax and regulate marijuana will have a terrific advantage in terms of money to be made from taxes and job creation. If Massachusetts beats Rhode Island to the punch, RI natives will cross the border, sending money and jobs out of state. Meanwhile, any Rhode Islanders who bring the products they buy legally in Massachusetts back to our state risk arrest, costing our state money in terms of policing and court costs.

Governor Gina Raimondo‘s 2016 Budget proposes a tax on medical marijuana, effectively taxing a legal prescription medication. It might behoove our state to tax and regulate recreational marijuana, and reap millions in taxes instead.

Here the press release:

Colorado’s regulated marijuana system generated more than $135 million in revenue for the state in 2015, including more than $35 million for school construction projects, according to the Colorado Department of Revenue.

There were just under $588 million in adult-use marijuana sales in Colorado from January-December 2015, producing approximately $109.1 million in tax revenue in addition to $4.7 million in license and application fees. The state’s regulated medical marijuana system produced more than $11.4 million in tax revenue and $9.8 million in license and application fees.

In 2014, the state’s regulated marijuana system raised just over $76.1 million in total revenue, including about $56.2 million from adult-use marijuana tax revenue and fees and $19.9 million in medical marijuana tax revenue and fees.

“There are hundreds of millions of dollars in marijuana sales taking place in every state,” said Mason Tvert, the Denver-based director of communications for the Marijuana Policy Project. “Colorado is one of the few where those sales are being conducted by licensed, taxpaying businesses.”

Adult-use marijuana sales in Colorado are subject to the state’s standard 2.9% sales tax, plus a 10% special state sales tax. Additionally, wholesale transfers of adult-use marijuana are subject to a 15% state excise tax. The first $40 million raised annually by the 15% excise tax is earmarked for public school construction projects. The excise tax raised just over $35 million in 2015, up from about $13.3 million in 2014.

“These tax revenue figures are truly impressive,” Tvert said. “Just six years ago, Colorado received zero dollars in tax revenue from the sale of marijuana in the state. Now it’s raising more than $100 million annually with tens of millions of dollars directed toward public school improvements.

“The additional tax revenue far exceeds the cost of regulating the system,” Tvert said. “Regulating and taxing marijuana has been incredibly successful in Colorado, and it represents a model for other states to follow. These numbers should put to rest the claims we keep hearing from opponents that marijuana tax revenue has fallen short of expectations in Colorado.”

Instead of levying hefty fees from patients like me who have debilitating health conditions, Governor Raimondo and lawmakers should tax those who use marijuana for enjoyment. For us patients, marijuana is often the only thing that eases our suffering, and it is already difficult to afford because health insurance does not cover it. Raising revenue from seriously ill patients’ medicine is wrong, but taxing recreational consumers is appropriate and could help alleviate our state’s deficit.”

Jared Moffat, Director of Regulate Rhode Island, issued the following statement:

We tax alcohol, but not prescription medications. Similarly, it makes little sense to extract revenue from sick people who need marijuana as a medicine while keeping marijuana that is used for fun untaxed and in the illicit market. I suspect most recreational marijuana consumers would be happy to pay taxes if only the state would make it legal for them to do so. In addition to generating more revenue, regulating marijuana like alcohol would erode the illicit marijuana market and create new businesses and jobs all over the state. It’s time to get our head out of the sand and move forward like our neighbors in Massachusetts and Vermont.”

[From a press release]

Jared Moffat, director of Regulate RI, a group advocating legislation to tax and regulate marihuana like alcohol, delivered nearly 500 postcards from constituents within Speaker Nicholas Mattiello‘s district in favor of the legislation to the Speaker’s office on Wednesday.

“We hope the House Speaker and Senate President will agree with the majority of voters that it’s time to start regulating and taxing marijuana like alcohol in Rhode Island,” said Moffat. “At the very least, they should allow a vote on the bill before the session ends.”

According to Regulate RI’s press release, “S 510/H 5777, the ‘Marijuana Regulation, Control, and Taxation Act,’ would allow adults 21 and older to possess up to one ounce of marijuana and grow one mature marijuana plant in an enclosed, locked space. It would create a tightly regulated system of licensed marijuana retail stores, cultivation facilities, and testing facilities and direct the Department of Business Regulation to create rules regulating security, labeling, and health and safety requirements. It would also establish wholesale excise taxes at the point of transfer from the cultivation facility to a retail store, as well as a special sales tax on retail sales to consumers.”

“Regulating and taxing marijuana in Rhode Island would give our state’s economy a much-needed boost,” Moffat said, “It would generate revenue, foster new businesses, and create jobs. S 510/H 5777 should be included as part of the General Assembly’s initiatives to rebuild Rhode Island’s economy.It’s hard to imagine why the legislature would end the session without voting on a widely supported proposal that is intended to bolster the economy and improve public safety.”

Representative Scott Slater introduced a bill (H5777) in the RI House of Representatives yesterday to tax and regulate marijuana. Senator Josh Miller introduced identical legislation in the RI Senate. Speaking at a press conference yesterday, both legislators were optimistic that this might be the year the legislation passes.

Though a pair of cranks attempted to hijack the press conference by insisting that the speakers use the word “cannabis” instead of “marijuana,” Jared Moffat, executive director of Regulate Rhode Island, a coalition of groups in support of marijuana regulation, showed remarkable poise and kept the presentation on track.

Representative Slater said that Colorado, the first state to tax and regulate marijuana, “has one of the fastest going economies in the country.” Money spent on legal marijuana products is money denied to organized crime, says Slater, who asked, “Do we allow criminals to control the market? Or do we want the sales to be regulated and taxed?”

• Mattiello open minded on marijuana reform
• Paiva Weed still skeptical on regulating marijuana
• Rhode Island has the most per capita marijuana users
• Legalizing marijuana enjoys ‘tripartisan’ support
• Legalizing marijuana could mean $82 million in revenue for RI

Senator Miller cited justice, public safety and revenue issues as reasons for a growth in support for the idea. Many more groups have joined the call for regulation, and the governor, the Senate president and the speaker of the House have all said that they are open to considering such an idea.

Dan Harrop, the recent Republican candidate for mayor of Providence, was to speak at the press conference, but an auto accident, in which Harrop was unharmed, prevented his attendance. Instead Dr. James Crowley spoke about the current laws regarding marijuana prohibition as being “fundamentally wrong, and a tremendous waste of resources.”

Crowley also spoke of the “first mover advantage.” The first state in New England to tax and regulate marijuana, Crowley maintains, will have early and sustainable marketing advantages that should last even as other states follow suit. Massachusetts activists have already managed to get legislation onto the ballot, and Rhode Island has “a small window of opportunity” if we want to be first, and reap the financial rewards.

Senator Miller says that a majority of Rhode Islanders are in favor of taxing and regulating marijuana, saying, “I think this is the year to do that.”