Marijuana users celebrate 4/20. McLean County taxing bodies celebrate how much tax money pot makes
April 20, or 4/20, is a day marijuana users and advocates consider a sort-of national holiday, especially in places where it's legal to smoke pot.
Government leaders in Illinois may have reason to celebrate, too. Cannabis has padded city, county and state offers with substantial sales tax money since Illinois legalized its sale and production in 2020. But it's not clear exactly how much Bloomington, Normal or other municipalities are benefiting from Illinois' newest cash crop.
When Illinois legalized marijuana, advocates said the sale of pot would help cash-strapped governments, starting with the state of Illinois. And it has helped. According to the Illinois comptroller's website, tax revenue from adult use cannabis cultivators and dispensaries has totaled $720 million since the start of 2020.
In the last year, sales have grown like a weed. Tax proceeds for the first nine months of this budget year have topped what the state brought in the previous 12 months.
State government isn't the only one cashing in on marijuana. Bloomington, Normal and McLean County governments all decided to tax its sale. It seems they have all financially benefited from marijuana. How much? We don't exactly know.
Bloomington City Manager Tim Gleason said he'd like to share more, but he can't. “This is an area I would like to be more transparent about, but it’s not something at the local level we control,” he said.
Bloomington and Normal both tax cannabis sales at 3%. There's one dispensary in Normal and one in Bloomington. So to report how much tax revenue the Twin Cities received is to say how much each dispensary made. “Exposing those revenues would identify that dispensary and I think there would be some problems with the state Department of Revenue,” Gleason said. “That’s one reason why we sort of tiptoe around that.”
Not knowing how much tax revenue a public body is getting from marijuana cuts against government transparency. But does the public really have a right to know how much a particular business makes?
Carol Portman is president of the Taxpayers' Federation of Illinois, a non-partisan group that advocates for fiscal policy. Portman said in this case, there's tension between the need for taxpayer confidentiality and the public's right to know.
“I can understand, especially if it’s a particular municipality is counting on this money, I can see where taxpayers will say ‘Where is it? How much do we have?’ Postman said.
Exact amounts for Bloomington and Normal are not known, but we can get a pretty good idea by seeing how much money these pot stores are generating collectively. McLean County also taxes cannabis sales at 3%.
County financial records show the county raked in $570,200 from that tax in 2021. That includes revenue from both dispensaries, both of which are owned by the same company. Based on that data, Bloomington and Normal would have received about $570,200 in total, split between them.
That means the two dispensaries in McLean County grossed $19 million in sales last year.
McLean County Administrator Cassy Taylor said the amount of cannabis revenue came as a pleasant surprise. She said the county didn't know what to expect, especially in the midst of the coronavirus pandemic.
“We were really being conservative in spending in trying to make sure the county was in good fiscal health as we went into unprecedented and unknown times,” Taylor said. “That revenue from the cannabis tax was able to offset some of those departments that had additional expenses.”
The county previously agreed to set aside 35% of its cannabis tax money for mental health treatment.
Local government bodies also get a smaller share of what the state collects in cannabis taxes. McLean County got an additional $35,300 last year. The Town of Normal estimates its intake from the state share at about $80,000 per year. The City of Bloomington estimates its proceeds at $138,000 this year year, based on the revenue it received over the last four months. That funding is being used for crime prevention, training and education related to cannabis.
All that cannabis money may come with additional costs. Critics worried easier access to marijuana would lead to more drug addiction. It's not clear whether that has happened. Lisa Thompson, of the Bloomington-based non-project Project Oz said there's little data on youth marijuana use because data collection at schools suffered during the pandemic.