How Local Government Spends Excise Tax Payments?

In The Weeds | Marijuana Excise Tax Pt 3: Local Governments

How Local Government Spends Excise Tax

The AWC lays out provisions on how excise tax payments should be spent.

“The legislature further intends to share marijuana tax revenues with local jurisdictions for public safety purposes and to facilitate the ongoing process of ensuring a safe regulated marijuana market in all communities across the state,” according to HB 2136.

That’s a fancy way of saying, marijuana excise tax is spent on law enforcement, the payments are labeled marijuana enforcement in the budget.  Law enforcement accounts for 70 to 75 percent of Kittitas County’s budget, according to the Kittitas County Commissioner, Paul Jewell.

First, the money is sent to the general fund, which is the largest pool of money pertaining to the county budget, Kittitas County Auditor Jerry Pettit said. The City of Ellensburg’s excise tax payment also goes into its general fund, per Jerica Pascoe, City of Ellensburg’s Finance Director. Excise tax is required to be spent on law enforcement fiscal years 2016 and 2017, but can be used for whatever in 2018. Most likely it will continue to go towards law enforcement, Pascoe suggests.

 

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What do Local Officials Think About This?

Commissioner Jewell is not in favor of the excise tax distribution caps, citing considerable financial increases in: emergency services, additional law enforcement, and regulatory and zoning issues. Rich Elliott is the Deputy Chief of Kittitas Valley Fire and Rescue, as well as Ellensburg City Mayor. He’s not necessarily opposed to the distribution caps, as long as the state is spending the money effectively.

“There’s a lot of substantial local government costs associated with legalization of recreational marijuana,” Jewell stated.

Elliott rejects Jewell’s claims that recreational cannabis is impacting emergency services or the city negatively. Financially or otherwise.

It generates jobs and tax revenue, and we’re not seeing immediate impacts with legalized marijuana, that I’m certain of,” Elliott emphasized. He cited a report made to Ellensburg City Council by Police Chief Dale Miller.

Last year, Jewell’s claims about legal cannabis burdening the community were disputed by The Observer, CWU’s student newspaper. Jewell claims emergency calls involving edibles increased since legalization, and they did from 2015 to 2016, but that statement alone is misleading. There were 4 EMS calls involving edible cannabis in 2015 and 14 in 2016, according to Kittitas Valley Fire and Rescue’s emergency call records.

These calls were relatively low acuity, meaning the people being responded to weren’t that sick. There were around 100 alcohol related calls in 2016 making it markedly more common. And drunk people are more difficult and more dangerous to deal with than people under the influence of cannabis, Elliott told The Observer.

In part four we will wrap things up and discuss the overall state of the excise tax system.

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