File this one under “a bit too on the nose.”
The Oregon Office of Economic Analysis (OEA) offered up a statistical nugget in a report last week that would seem like a corny joke if it weren’t true.
“Furthermore, and in things you cannot make up, Oregon sales per adult along the Idaho border are 420% the statewide average,” wrote Lehner.
“The number 420 is a colloquial term referencing marijuana or cannabis consumption,” deadpanned the AP.
The Border Effect
Beyond the amusing tidbit, the OEA, which provides forecasts for legislators and policymakers in Oregon, detailed some other intriguing findings in the study.
Lehner’s report focused on “border effects,” which he wrote “can arise when neighboring jurisdictions have different rules, regulations or tax rates for the same industry or product.”
Idaho, where recreational marijuana remains illegal, invites such analysis given that it borders Washington and Oregon, where pot is legal.
“Obviously recreational marijuana is not legal in Idaho, but even after throwing the data into a rough border tax model that accounts for incomes, number of retailers, tax rates and the like, there remains a huge border effect,” Lehner wrote. “Roughly speaking, about 75% of Oregon sales and more like 35% of Washington sales in counties along the Idaho border appear due to the border effect itself and not local socio-economic conditions.”
Lehner suggested that the reason could be the addition of three marijuana stores in Oregon near the state’s border with Idaho.
“Initially the closest retailers to Idaho were located in Baker County, [Oregon], however that changed last summer,” Lehner wrote. “There are now 3 retailers in Ontario, [Oregon] (Malheur County) which is right at the border. These new retailers are 30-60 minutes closer each way to any potential customers traveling into Oregon along I-84 than the retailers in Baker County. As one might expect, as these new stores in Malheur County came online, sales plunged in Baker County by around 80%. This is a knock-on impact of the border effect. Proximity or distance traveled matters as do product availability, prices, and taxes.”
“The border effect is real. Both Oregon and Washington see a clear impact in higher recreational marijuana sales along the Idaho border than can be explained by local socio-economic factors,” he wrote in his conclusion. “Now, this does not mean that all of those larger sales are necessarily to Idahoans. It could be other customers maybe traveling from further away or from elsewhere within our state who are traveling through.”