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California Cannabis Tax Revenue Isn’t Going To Youth Programs—Yet

There hasn’t been enough money to fund youth programs. But that could be changing.

California Cannabis Tax Revenue Isn't Going To Youth Programs--Yet

According to new reports coming out of California, a key aspect of the state’s original marijuana legalization bill is not being met. Specifically, youth programs are so far not receiving the funding that the original legislation promised they would.

As concern grows over why this is happening, experts have identified a few trends that could be creating this scenario. And on an optimistic note, many in the state expect to see things start improving.

Why Youth Programs Aren’t Receiving Funding

In November 2016, California voters approved Proposition 64. The bill made recreational weed legal in the state. And as is typically the case with legalization bills, one of the primary concerns of the proposition was figuring out how the state would use tax revenues.

Among several uses, the state promised to use a portion of cannabis taxes to fund youth programs. Specifically, youth programs aimed at substance abuse education.

After Prop. 64 passed in 2016, the retail sale of recreational cannabis officially launched Jan. 1, 2018. Now, a full year after that date, the state has failed to fund youth educational programs.

According to the AP, experts say there are two primary reasons for this lack of funding. First, the state’s structure for spending cannabis tax money places these youth programs at a lower priority than other initiatives.

As outlined in California’s legal framework, there is a multi-tiered system for prioritizing who gets tax revenue first. Under this system, the top tier of funding goes to startup costs and operational costs associated with state regulatory functions.

Below that, things like university research and funding for California Highway Patrol is on the second tier. That leaves youth educational programs for the third tier of spending.

It’s possible that there might not be any problems with this system. But experts say it’s problematic because the state has not brought in as much cannabis tax revenue as originally predicted.

As a result, there simply hasn’t been enough money in the coffers to make it to the third tier of spending. And that means that youth programs have so far gone unfunded.

Fixing the Problem

For advocates of these youth substance abuse education programs, the news isn’t all bad. In fact, many experts think that things could turn around soon.

California’s fiscal year ends in June. And current trends in the state’s cannabis market indicate that there could be enough revenue by then to fully fund youth educational programs.

If the state hits that milestone in June, things could be on track to get even better next fiscal year. According to experts reporting to the AP, California’s upcoming fiscal year could realistically increase funding for these programs by as much as $160 million.

State officials are also working to address other lingering problems that could negatively affect how California spends marijuana tax money.

Currently, there is a lot of confusion in the language used to outline tax spending rules. For example, there is no clear definition of “youth.” This could create confusion (or loopholes) when it comes to figuring out exactly which types of educational programs would qualify for tax spending.

There are other similarly confusing details. And officials are working to more concretely define all aspects of its cannabis tax framework.

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