Taxes From Legal Pot Could Subsidize Weed For Low-Income Patients In New Mexico

A new proposal would use taxes from medical cannabis sales to help people buy weed and fund the police.
Taxes From Legal Pot Could Subsidize Weed For Low-Income Patients In New Mexico
AP Photo/ Morgan Lee

SANTA FE, N.M. (AP) — A proposal unveiled Wednesday for legal marijuana sales throughout New Mexico would use taxes to subsidize medical pot purchases for low-income patients and set aside money for police and loans to cannabis startup companies.

A panel appointed by Gov. Michelle Lujan Grisham, a Democrat, published recommendations for legalization that take cues from other states that regulate recreational marijuana markets.

The proposal would prohibit local governments from banning marijuana sales, though they could apply restrictions on business hours and locations, said Albuquerque City Councilor Pat Davis, who led the governor’s task force on legalization.

The provision is aimed at curbing illicit markets and keeping marijuana shoppers from traveling long distances.

The recommendations will now go to the Legislature for consideration.

Davis said several elements would set New Mexico apart from other states, in part by protecting its medical marijuana program from a potential exodus of patients — an outcome that has been seen in several other states.

“We’re going to use some of the revenue from recreational marijuana to reinvest … so we don’t lose those patients,” he said.

Medical marijuana is currently taxed on average at 7% but would become tax-free under the legalization proposal. Millions of dollars would be set aside to subsidize cannabis for low-income patients with qualifying medical conditions such as cancer, post-traumatic stress disorder or chronic pain.

All licensed recreational marijuana business would be required to serve the medical marijuana market, with priority given to patients when supplies are scarce.

The recommendations from the 23-member task force set the stage for a new push to authorize recreational use and sales of marijuana when the state Legislature convenes in January.

Bipartisan legalization legislation stalled in the state Senate earlier this year. The measure proposed state-operated marijuana stores as a way to limit the proliferation of storefront shops in small towns. It encountered resistance from existing medical dispensary owners.

Lujan Grisham has made her support for recreational marijuana contingent on finding ways to protect children and ensure roadway safety and effective workplace regulation.

The task force recommendations include a ban on marijuana ads on television, radio and mobile devices.

Nonsmoking marijuana products would be tested and labeled to show the concentration of psychoactive THC to try to reduce hospital visits linked to unintentionally high doses of THC.

Legal cannabis would be treated much like alcohol when it comes to the workplace. Workers currently must demonstrate that a long period of time separates intoxication and job duties.

To pay for safety and other initiatives, a 10% excise tax on recreational pot was suggested, with proceeds divided equally between state and local governments. Combined with taxes on sales and business transactions, that would mean an average markup of 17% for marijuana.

Initial annual revenues of $55 million were anticipated, a figure that officials have predicted could double within five years.

A cannabis venture fund would provide loans to low-income and small family owned businesses to start marijuana businesses and provide cannabis-industry job training at community colleges.

The recommendations would continue the state’s prohibition on growing marijuana at home without a specialized medical authorization, while decriminalizing minor violations. The task force endorsed automatic expungement of past cannabis possession convictions.

Currently, medical pot patients must register for a personal production license to grow up to 16 plants at a time — a figure that includes just four mature plants with ingestible flowers.

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