Pot brings $168M to Washington state. How do we spend it? | KUOW News and Information

Pot brings $168M to Washington state. How do we spend it?

Mar 29, 2017

We followed the money trail from one bag of weed. 

Last year marijuana sales in Washington state raised $168 million in cannabis excise tax.

This prompted a question to KUOW’s Local Wonder from Maggie. She wanted to know how the proceeds from legalized marijuana sales are being utilized by the state.

At GreenWorks Cannabis in Lake City, there are a variety of cannabis options: chewy fruit candies, cookies, brownies and even breath sprays. 

Budtender Shane Robertson recommends four grams of pesticide-free weed from the Methow Valley. This costs $30, including tax. Weed taxes are 37 percent, plus state sales tax of over 9 percent.

For that bag of organic weed, Washington gets $7.57 in cannabis taxes. The biggest chunk of that money – almost $4 – goes to the state's Medicaid fund.

Just down the street at the Neighborcare clinic in Northgate, the money helps patients like Lucas Alvarez. 

Alvarez has diabetes, but with Medicaid he says he gets regular checkups and medicine. As a janitor and landscaper, he said he couldn’t afford coverage otherwise. Through a translator, Alvarez said he believes funding Medicaid is good use of marijuana taxes.  

Katie Verriere is a family nurse practitioner who takes care of Alvarez. She said insurance is vital for low-income and immigrant patients.

“Without Medicaid, a lot of our patients would have to forgo care and not get the preventative care and general wellness, as well as sick care that they need,” Verriere said.

Cannabis taxes also go to substance abuse prevention and drug education. About $3 million has been spent on public service announcements.

Back to that $30 bag of organic weed – about $0.90 or 12 percent from its taxes will go to the Washington Department of Social and Health Services. 

The taxes also pay for MRI scans in a basement lab at the University of Washington. Research participants lie in the scanner, sniffing simulated weed smells while pictures of their brain are taken.

Professor Natalia Kleinhans uses brain scans to research addiction. She says it’s a way to break new ground and learn more about drug cravings and relapse.

“If somebody has been trying to stop using marijuana and they walk by and they smell it, they’ll start to crave marijuana, and addictions researchers think that this is one of the biggest, most critical symptoms that contributes to relapse,” Kleinhans said.

Studies like this one at UW receive less than one percent of the state’s cannabis revenue.

Washington State Treasurer Duane Davidson displays the treasury's vault in the basement of the state capitol in Olympia.
Credit Courtesy of the Washington State Treasurer

Once the tax money is divvied out, the rest of it goes to Olympia – to a man who lives on a boat in the harbor. State Treasurer Duane Davidson doesn’t get the money personally, but his office pays the state’s bills. They do about a million banking transactions every month.

He said if this were the 1920s, when state business was conducted in cash, cannabis revenue would go into the basement of the state capitol where there’s a very large vault.

“It was actually brought to this site and then when they built this building in the early 1920s it was literally built around that safe, it’s that large,” Davidson said.

Now the cannabis revenue is deposited in a bank account at U.S. Bank called the general fund. The state uses something similar to automatic bill pay where money gets transferred out to fund services like K-12 schools and higher education.

Buying that four-gram bag of organic weed generates about $2.45 for the state’s general fund – about a third of all marijuana revenue.

That money continues to grow. This year, Washington is expected to get over $300 million in cannabis taxes.