Oregon Begins Distributing Tax Revenue From Legal Cannabis
As Oregon lawmakers fight a $1.6 billion budget deficit in the next two-year budget cycle, legal cannabis has begun to pay off in the form of $85 million in collected taxes. The Oregon Department of Revenue announced last week that it would finally be distributing cannabis tax revenue to a variety of areas in the state, including the State School Fund, the Mental Health, Alcoholism and Drug Services Account, the Oregon State Police, the Oregon Health Authority and various cities and counties in Oregon. The distribution was completed on October 11.
Oregon has been collecting taxes on legal cannabis since the beginning of 2016 and until recently, the state hasn’t seen a penny. According to a wrinkle in the state law that governs legal cannabis, the Oregon Liquor Control Commission (OLCC) had to reimburse the $13 million in administrative costs related to setting up the state’s new cannabis program before distributing the tax revenue by September, according to agency spokesperson Mark Pettinger.
Most of the $13 million was paid using the cannabis tax account, with the remaining balance coming from fees. Of the $108.6 million collected in state and local cannabis taxes, $94.55 million was eligible for distribution, with $9.56 million being used to repay the OLCC’s start-up costs.
The state law also lays out how the tax money will be distributed, with a majority of the money (a whopping 40 percent) going to the State School Fund. The remaining 60 percent will be distributed amongst the other aforementioned agencies through the state. Certain cities and counties may receive a portion of that, but whether or not those areas are granted any money depends on population. Plus, counties that opted out of cannabis grows are ineligible for distribution.
Finally Oregon will be able to benefit from its largely successful cannabis industry after a long wait.
