After a year of budget cuts and funding rearrangements during the COVID-19 pandemic, Colorado’s Building Excellent Schools Today (BEST) program will receive those funds back from a major revenue source—cannabis taxes.
Senate Bill 207 passed the Colorado legislature on April 19, requiring the transfer of $100 million from the state’s Marijuana Tax Cash Fund into the BEST program to restore funding cuts last year.
The 2020 cuts were made to augment the state’s General Fund during the COVID-19 pandemic according to Senator Dominick Moreno, a prime sponsor of the bill and chair of the legislature’s Joint Budget Committee. That money will be coming back next year.
The bill is currently awaiting Governor Jared Polis’s signature, but will require the state treasurer to put that $100 million in cannabis tax revenue back into the BEST program in June 2022. Created in 2014 after recreational pot sales began in Colorado, the Marijuana Tax Cash Fund provides money for state education, health care, youth prevention, law enforcement, health education and substance abuse programs.
The BEST program was established in 2008 to provide funding for public schools to rebuild, repair or replace primary educational facilities. Since 2014, the program has primarily received funding from the State Land Board and marijuana excise taxes, with a small portion of funding coming from lottery proceeds and interest income.
According to Colorado Department of Education Capital Construction Director Andy Stine, the BEST program has received over $323 million in marijuana excise taxes since 2014. However, BEST is requesting around $650 million for 2021 projects alone. He also notes that local governments kick in a 50 percent match in BEST funding from state grants.
“As for the bill to restore funds to the program, any amount helps,” Stine said. “With an approximate 50 percent local match to our grants, $100 million of state funds will translate to about $150 million in projects.”
Following the new law and 2021-2022’s regulat revenue contributions from marijuana excise taxes, the Marijuana Tax Cash Fund will provide around $210 million into the BEST program in 2022, along with other revenue sources.
“We were in a position where we could, fortunately, restore many of the cuts that we made last year,” Moreno said.
According to Moreno, BEST’s financial forecasts are typically skewed because the program receives funding from multiple sources across the state. This can result in collecting a bigger balance than predicted, especially with cannabis tax revenue, which hit record numbers in 2020 despote early expectations that pot sales would decline during the pandemic.