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With cannabis for sale, Connecticut council proposes how to stay funded with taxes

Ulysses Youngblood, president of Major Bloom, shows marijuana stored in his office. It is processed and packaged for recreational sales at the store under heightened security.
Yehyun Kim
/
CT Mirror
Ulysses Youngblood, president of Major Bloom, shows marijuana stored in his office. It is processed and packaged for recreational sales at the store under heightened security.

The Connecticut Social Equity Council narrowly passed a budget proposal on how the state would divvy up potentially millions of dollars in tax revenue from its budding cannabis industry.

Connecticut has recorded just over $2 million in gross sales after the first sales were made at nine dispensaries in the state on Jan. 10.

The state imposes a 6.5% sales tax on cannabis, plus a 3% tax going to the local town or municipality where the dispensary is based.

The council, which normally makes recommendations to regulators for issuing licenses to sell retail marijuana, was considering how a third state tax of between 10-15% should be spent. It varies based on the cannabis product’s THC level, the psychedelic chemical that gets users high.

“This budget allows the council to live within its means from the expected revenues of the tax collection,” said Marc Pelka, an undersecretary to the state Office of Policy and Management Criminal Justice Policy and Planning Division.

The proposal would feed the THC tax revenue in new social programs, but the council does not yet have a concrete plan to continue funding its own operations. In addition, some of its members were concerned that the budget proposal would not reinvest in the community.

“We don’t get to come back and ask for it another time,” said Subira Gordon, a council member and executive director of Connecticut Coalition for Achievement Now. “[At the end of] 2023, I see a dash. A dash means zero. What I’m seeing is no money in the community reinvestment line item.”

Pelka said the proposal relies on the council obtaining $16 million this year and $20 million in the next. That money would come from “higher-than-expected one-time revenue” from the state, he said.

"Just because [the money] is not in there doesn’t mean they’re being removed,” Pelka said.

Still, Gordon said she is concerned that the council spending is “way lower than any amount of money we have discussed [sic] for reinvesting in the community.”

The proposal passed 6 to 5, and heads to the state Department of Consumer Protection, which oversees the council, for review.

The council will also consider changing its priorities when issuing licenses for the sale of recreational marijuana. The state gives half of the licenses to applicants from communities disproportionately harmed by the war on drugs.

Members of the council identify impacted communities by their drug conviction rate and unemployment rate. In a special meeting this month, members said they would consider the area’s poverty rate as a deciding factor.

A spokesperson for the council told Hearst Connecticut Media that the poverty rate is a more accurate measure of disparity.

Joseph D’Alessandro is a former news intern at WSHU.