Los Angeles Considering Using Marijuana Taxes to Help Homeless

Los Angeles may have devised an unusual idea to curb the homelessness rates in the Skid Rows of old Hollywood. City officials are reportedly mulling over a plan in a series of budget talks that would utilize a portion of the tax revenue generated from the local medical marijuana industry to build more affordable housing units for local residents.

Earlier last month, the local government approved an impressive $2 billion budget plan intended get the homeless population off the streets through the implementation of a new housing project. However, according to KPCC, the challenge for administrators has been in determining exactly how the city is going to finance such an extensive construction campaign. 

"Even as our economy improves, we do not anticipate to have an additional $1.78 billion over the next 10 years to dedicate for this purpose," Chief Administrative Officer Miguel Santana told the City Council during a recent meeting. 

One of the proposals selected by city budget analysts suggests a 15 percent tax on the cultivation and sale of medical marijuana – an effort that officials predict would generate nearly $17 million annually. It was even mentioned in the report that the yearly haul from this non-traditional revenue stream could increase exponentially if California voters decide later this year to legalize a recreational sector.

“Marijuana is a new product in the marketplace and could be a significant source of new revenue,” reads a recommendation in the proposal. 

A number of California cities have already adopted similar medical marijuana tax plans, including the municipalities of Riverside County, Cathedral City, and Desert Hot Springs.

However, putting a plan of this magnitude into place is not as easy as taking a few votes and signing some documentation. The Los Angeles City Council will first need to decide whether the medical marijuana tax plan is the best concept they have in their arsenal for bringing to life the low-income housing deal. There are eight other revenue-generating proposals up for consideration, including a special billboard tax and a General Obligation Bond that would allow the city to borrow the money and pay it back over the course of 30 years.

If the Council does approve the marijuana tax, voters would get to decide on the issue in the forthcoming November election or during the Primary Nominating Election ballot next March. The specific on when the special tax lands on the ballot depends on which proposal is approved.

One thing is: the marijuana tax will be met with a great deal of opposition.

Regardless if the money is used to house the less fortunate, medical marijuana patients rabidly oppose taxation schemes on cannabis because they believe it creates an unfair burden on their choice to use a natural substance rather than prescription drugs. Pot advocates argue that taxing green medicine creates economic hardships for patients and often drives them back into the black market.

Yet with an estimated 254,000 homeless people living in Los Angeles County, there may need to be some give and take. 

The City Council must make a decision on this issue before July.

photo via wfuv.org