Pubdate: Fri, 28 Aug 2015
Source: Bulletin, The (Bend, OR)
Copyright: 2015 Western Communications Inc.
Contact:  http://www.bendbulletin.com/
Details: http://www.mapinc.org/media/62
Author: Ted Shorack

WITH BANS, POT TAX REVENUE WILL BE LEFT ON THE TABLE

Crook County's Share Would Have Been Minimal for First Year

Five Oregon counties and 11 cities have opted to ban marijuana 
businesses and by doing so have been cut off from state tax revenue 
that will be collected from recreational pot sales.

But sparsely populated cities and counties will not be missing out on 
much in 2017 when such revenue is doled out to local governments for 
the first time.

According to the Legislative Revenue Office, up to $7.4 million in 
net revenue will be generated for a state shared account after the 
first period of recreational sales.

Tax dollars from recreational marijuana will initially be distributed 
to cities and counties based on population estimates from Portland 
State University's Population Research Center.

The state will divvy up 10 percent of the shared revenue among 
counties and 10 percent among cities. Local governments that ban 
marijuana are left out of the equation, creating a bigger piece of 
the pie for the rest.

Crook County, which is the most recent county to institute a ban, 
would have only received 0.6 percent of the county allocation.

About 20,780 people reside in the county. The county would have only 
received about $4,500 in tax revenue during 2017.

In contrast, Multnomah County, which has the largest population in 
the state, has 765,775 people and will eat up nearly 20 percent of 
the tax dollars distributed to counties. About $155,000 could 
potentially go to the county in 2017 as of right now.

Crook County's two commissioners and judge voted in favor of an 
ordinance banning marijuana. Judge Mike McCabe said his decision was 
based on substance abuse concerns and public safety. He added that 
potential tax revenue wasn't a factor.

"I think the tax dollars would be eaten up just in regulation and 
administration," McCabe said. "I don't think they would have much of 
an effect at all."

Forty percent of the state shared revenue will go to the Common 
School Fund, 20 percent will go to mental health, alcohol and drug 
services, 15 percent will be distributed to an Oregon State Police 
account and the Oregon Health Authority will receive 5 percent.

After July 1, 2017, shared revenue will be distributed to local 
governments based on how many Oregon Liquor Control Commission 
licenses are within their jurisdictions.

In 2018, the Legislative Revenue Office expects shared revenue to 
jump to $28.8 million.

Revenue generated and distributed in 2019 could be as much as $30.4 
million. About $6 million would be split among the cities and 
counties that haven't opted out.

Washington state generated about $70 million in tax revenue after one 
year of recreational marijuana sales. Shops opened in July 2014.

Deschutes County commissioners have slowed down a potential ban on 
marijuana in the unincorporated areas. The majority of county voters 
approved Measure 91, which made recreational marijuana legal on July 
1. A potential ban would have to be brought before voters in the 
November 2016 general election.

County commissioners are planning to work on land use regulations for 
marijuana businesses but haven't completely dismissed a potential 
ban. The board hasn't been concerned about potential revenue loss but 
has expressed interest in addressing potential conflicts between 
marijuana businesses and neighbors.

Board Chairman Tony DeBone said Monday that commissioners respect the 
potential for tax revenue, but the county is in a better financial 
position than many other counties.

"We're not in a desperate situation where it's something we would 
reach for because of what we already have," said DeBone.

For example, public safety funding has been an issue for many 
counties, DeBone said. The Deschutes County Sheriff's Office has two 
taxing districts that permanently fund operations.

Deschutes County's population was last estimated at 166,400 in 2014, 
according to the Population Research Center.

The county would lose out on about 4.2 percent of the taxes generated 
in 2017 if commissioners choose to opt out. About $33,000 would 
potentially be distributed to the county by the state.

Counties and cities were afforded the ban through House Bill 3400, 
which was signed by Gov. Kate Brown on June 30. Bans could be on 
retail shops, processing, wholesale and growing. They could also 
include future medical marijuana operations.

House Bill 2041 instituted a taxing structure for implementing 
Measure 91, which was approved by 56 percent of Oregon voters.

Cities and counties can also impose their own 3 percent local sales 
tax if they allow marijuana businesses within their jurisdictions.

Recreational marijuana sold temporarily through medical dispensaries, 
which will be able to start doing so Oct. 1, will be taxed at 25 
percent. Taxes won't begin being collected until January.

Jefferson County, which has an estimated population of 22,205, does 
not intend to consider a ban on marijuana.

The city of Madras, however, will hold a meeting at 6 p.m. Tuesday at 
the Madras Council Chambers to discuss whether a ban on pot should be 
implemented.

The cities of Bend, Redmond, Sisters, La Pine and Prineville do not 
plan to consider a ban as of now.
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MAP posted-by: Jay Bergstrom