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Colorado Recreational Cannabis Tax Increase Gets Bipartisan Endorsement

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A coalition is proposing a higher tax on recreational cannabis in Colorado to help children make up for learning losses during the pandemic and to address special needs for low-income and disadvantaged students. The proposed tax increase would be up to voters in the state to decide, though it’s already been endorsed by former Democratic and Republican governors.

The coalition, Learning Opportunities for Colorado’s Kids, is circulating petitions right now, and they need 250,000 signatures by Aug. 2 to place the initiative on the November ballot.

Initiative 25 would create a Colorado Learning Authority through the education department that would oversee out-of-school tutoring, English language instruction, special needs and disability instruction, mental health and career training and technical training for children ages 5 to 17. The services would also be extended to lower-income families and children falling behind their grade levels by certifying tutors. The funds would not be used for in-school expenses or private school tuition and would be distributed directly to tutors.

The initiative proposes a five percent excise tax increase on recreational cannabis by 2024, which is projected to generate more than $137 million a year. Recreational cannabis sales currently have a 2.9 percent state sales tax alongside a 15 percent excise tax, proceeds going in part toward school construction and maintenance.

If the increase was approved, phasing would begin in 2022, and the authority would also take some existing revenue through leases, rents and royalties for paid activities on Colorado land, and it could also seek outside funding.

Colorado’s recreational cannabis industry is hesitant around the proposal, suggesting that consistent tax increases could help push consumers to the black market. “This initiative helps level the playing field and lift up those for whom there are too few opportunities,” Papa Dia, executive director of the Aurora-based African Leadership Group, which serves the African immigrant community, said in a statement. “With LEAP, we can narrow the opportunity gaps between the rich and poor, between students from homes where English is not the first or primary language spoken, and between those attending high-performing schools and those who do not,” Dia said.

Colorado Governor Jared Polis has put an emphasis on early childhood education, including expanding preschool and kindergarten education, and the initiative would work to complement this stance as well.