Faced with an intractable and growing homeless crisis, two weeks ago, the Los Angeles Board of Supervisors made a bold and largely unprecedented move: It approved a November ballot measure that would impose a 10% tax on gross receipts of medical marijuana as well as recreational marijuana businesses, if statewide legalization passes at the polls, to help fund the estimated $450 million a year the county needs for homeless housing and services.
It didn't take long for the measure to face criticism. The Los Angeles Times' editorial board worried that the levy, combined with other taxes imposed on recreational marijuana, "could push up the price of pot so much that customers and suppliers return to the black market" — defeating the purpose of legalization in the first place.
But there's also a philosophical question to ponder: Cigarette "sin taxes" usually go to anti-smoking efforts. Casino taxes fund gambling-addiction programs. Why should a similar tax on cannabis go to homeless services? What does marijuana have to do with homelessness in the first place?
At first glance, not much. Experts agree the main causes of homelessness are a lack of affordable housing options, minimal work opportunities and a dearth of public-assistance programs; there's no evidence that cannabis or other drug use directly leads to a life on the streets.
But while marijuana doesn't cause homelessness, it is having an impact on homeless services in places that were among the first to legalize the drug. Much has been made of the tourists, entrepreneurs and investors flocking to Colorado, Washington state and Oregon to take advantage of legal cannabis.
Far less attention has been paid to those at the lower end of the socioeconomic spectrum being drawn to these state experiments. I recently spent several months interviewing dozens of workers at homeless shelters in and around Colorado, and the general consensus was that since Colorado launched its legal marijuana market in 2014, 20% to 30% of newcomers to the shelters in Denver and other major cities in the state say they've come to the region in part because of cannabis.
Some of these "marijuana migrants" aim to get jobs in the new industry. What they don't realize is that the high demand for such positions, coupled with the pricey state application fees and criminal background check required for all marijuana workers, make it hard — if not impossible — for them to do so.
Others simply want to be somewhere where they can use cannabis, medically or recreationally, without fear of arrest — although it turns out their unique situation still leaves them at risk of running afoul of the law. For while marijuana might be legal in Colorado, public consumption of it isn't. That means those who don't have a private residence still can get busted for partaking on the street or in parks. This is likely one of the reasons why after Colorado launched its legal marijuana market in 2014, citations for public marijuana consumption and display in Denver jumped from 184 to 762.
While the $100 maximum fine for such tickets might seem minimal, it's devastating if you're living dollar-to-dollar. Ongoing penalties for marijuana use is one of the main reasons the head of criminal justices services for Larimer County in northern Colorado believes the number of homeless individuals in his jail skyrocketed from 674 in 2012 to 1,018 in 2015.
Could California cities, already struggling with high homeless numbers, experience a similar phenomenon if the state legalizes marijuana this November? The answer is unclear.
Shelter representatives I spoke with in Seattle and Portland, Ore., uncovered no evidence that new clients were being drawn to those regions because of legalized cannabis. Nor have major shelters in L.A. or San Francisco seen much past evidence of marijuana swelling their clientele, even though the cities are known for their medical cannabis industries.
It's possible that Colorado is the outlier — the only place likely to attract marijuana migrants thanks to all the headlines it earned for being the first place to legalize cannabis. But maybe not. California is on the verge of launching a legal marijuana market in what is the world's eighth-largest economy, trumping every legal marijuana regime that came before it. A development like that could draw attention — and new residents — from far and wide.
Shelters in cities like L.A. also could be on the receiving end of regional population shifts triggered by marijuana going legit. Sam Dodge, San Francisco's homeless czar, told me he's concerned about the itinerant marijuana workers who flock to the "Emerald Triangle" of Mendocino, Humboldt and Trinity counties during harvest and trim season. Legalization could upend the cycle, forcing these workers to flock to cities like Los Angeles to look for jobs. "I very much want to see that [legalization] doesn't wreak havoc on the very poor regions of California that rely very much on the marijuana industry," Dodge told me.
In other words, taxing marijuana to pay for homeless services might not be so crazy because legalized cannabis could have an unintended effect on L.A.'s shelters. But even if the city's homeless services aren't impacted, maybe it's not a bad idea to dedicate marijuana proceeds to those most in need. It's not every day that a municipality gets an entirely new revenue stream — why not do something exciting with it and dedicate it to something city leaders have long said is a priority? That's why the city of Aurora, Colo., recently dedicated some of its $4.5 million in marijuana proceeds to homeless services over the next three years — not because cannabis was wreaking havoc on its shelters, but because officials there decided it was the right thing to do.
Legalizing marijuana in California will be historic. Why not do something historic with the resulting tax revenues, too?
Denver-based writer Joel Warner has covered marijuana legalization for a variety of publications, including most recently International Business Times.