Crime Down, Revenue Way Up for Colorado 5 Months Into Marijuana Legalization

Fri Jun 06, 2014 21:02:08PM | Categories: Legalizing Marijuana, Sales Tax, Colorado, Marijuana Should be Legalized & Marijuana

Downtown Denver skyline, near I-25 & Speer.By: Matt Wright
Back on November 6th, 2012, the bold states of Colorado and Washington passed ballot measures alongside the last presidential election process to fully legalize marijuana. After a little over a year and much ado with legislative, fine print write-ups and cultural discussion, Colorado took the plunge and broke ground on becoming the first state in the great US of A in modern history to sell marijuana for recreational use. Doors opened January 1st, 2014. This blog's purpose is to discuss the progress made so far with Colorado's 2014 efforts, citing stats from official data released by the state itself. If I had to sum up the state's experience in one word thus far though, I'd go with: success!


Crime Will Go Up, They Said...

Let's start with looking at the biggest argument made against legalizing marijuana, mainly the societal impacts the original detractors so vocally feared. We will see if their argument held any water at the time, or if they were just blowing smoke, pun intended.

Crime will go up. That was more or less one of the biggest arguments made against full legalization for recreational use. For the remainder of this part of the discussion, I will be citing statistics from the city of Denver, CO. Denver turned out to be one of the few cities in Colorado that did not decide to ban the new legislation, regardless of it being statewide legal or not. To be fair, it is hard to blame the cities that opted out. I mean marijuana is still federally considered a Schedule 1 drug and remains illegal according to D.C. Current violators of such a law could face extremely strict and costly repercussions for possession and sell.

Interesting to note that many cities did in fact decide to continue to ban sales no doubt under the assumption that they did not want to be on the forefront if things went south. Perhaps they believed and bought into the criticism. Perhaps many just didn't want to be known as a city that sells weed; could make for a bad image. Well, I think that Denver's results just might sway them out of their past thinking. My feeling is that it won't be too terribly long until other cities will want some of that marijuana money to come rolling into their cities' accounts as well. Anyways, back to the issue at hand. Let's take a look at Denver. Here is the official crime report the city of Denver released, showing the correlation in a number of city-wide offenses, comparing the first four months of 2013 with that of 2014. Illegal marijuana vs. legal.

First up: Violent Crimes.

Homicides for 2013 - 17. 2014 - 8. That's a 52.9% drop.
Sexual Assault for 2013 - 110. 2014 - 95. That's a 13.6% drop.
Robbery for 2013 - 351. 2014 - 334. That's a 4.8% drop.
Aggravated Assault for 2013 - 709. 2014 - 683. That's a 3.7% drop.

Keep in mind, these are NOT drug related offenses being reported. These are violent crime statistics. The same stats that many cited would inevitably increase were you to make marijuana fully legal. Well, for the first 4 months, at least with homicides, sexual assaults, robberies, and aggravated assault, the numbers are in fact LOWER with marijuana legal vs illegal. Direct correlation? Perhaps not. But consider two very important points: 1) If these numbers increased, the opposition would be having a field day citing that violent crime has gone up in the big city of Denver with marijuana now legal. As of now, those voices are decidedly quiet. 2) You could say that these 'drops' more or less represent a status quo, and that violent crimes are about the same as last year. That crime rates didn't drop directly BECAUSE of legalizing marijuana. Well then, I would say that's a good point. A point that proves that fully legalized recreational marijuana being freely available for purchase by consenting adults of age is not making crime rates go up either. Either way you parse it, all the evidence of the first quarter of non-speculative data suggests that violent crime rates are marginally going DOWN. Which in turn currently disproves one of the biggest talking points against legalization, that crime will go up.

Anyways, allow me to finish with the numbers from the report, this time focusing on other crimes, labeled Part 1 Property Crimes.

Burlary for 2013 - 1,491. 2014 - 1,421. That's a 4.7% drop.
Larceny (minus MV theft) 2013 - 2,133. 2014 - 2,287. That is the first slight increase. Negligible, but still worth noting. 7.2% increase.
Theft from Motor Vehicle for 2013 - 2,317. 2014 - 1,477. That's a 36.3% drop.
Auto Theft for 2013 - 1,127. 2014 - 1,049. That's a 6.9% drop.
Arson for 2013 - 20. 2014 - 47. That's a 135% increase. The lone violent crime major increase. Can you honestly relate that to weed being legal?

Finally, here are the total numbers for crimes committed, comparing the 1st quarter of 2013 with that of 2014:

For Violent Crimes: 2013 - 1,187. For 2014 - 1,120. Very similar, but a slight drop all the same of 67, or 5.6%
For Part 1 Property Crimes: 2013 - 7,088. For 2014 - 6,281. Again close, but again a drop from 807, or 11.4%
Combining these 2 Crime Brackets: 2013 saw 8,275. 2014 - 7,401. That's 874 less crimes reported, or a 10.6% drop.

That's 4 months of non-speculative, city provided data to suggest that non-drug related criminal activity does NOT increase when weed is made legal. And Denver is a very good place to be a microcosm for the rest of the country. The city of Denver has a population of 632,265 according to a 2012 estimate. That makes Denver the 23rd largest city in the nation. Denver is also the largest city in all of Colorado.

To show that I'm not cherry picking data, or skewing the numbers in favor of making a point, here is the official release, provided by the city:

REPORTED OFFENSES IN THE CITY AND COUNTY OF DENVER BY MONTH



Money Talks

Now let's look at the revenue generated from recreational marijuana sells in the state of Colorado. Important note: These numbers DO NOT take into account any revenues made from medical marijuana, just recreational. This data will be brought to you courtesy of the official numbers from Colorado's Department of Revenue, which can be found here in full: Colorado Marijuana Tax Data

In summary, here are the highlights:

Total of All Generated Money from Marijuana Taxes, Licenses, and Fees:

January - $10,058,697
February- $13,850,628
March- $18,529,448
All 3 Total - $42,438,773

So, over $42 Million dollars has been generated in the state of Colorado alone, solely by the sells of recreational marijuana in the first 3 months of 2014. I wish I had the numbers for the first 5 months. But they have not as of yet been released, and I say to make the strongest argument, present facts, not speculation. To quickly contradict myself however, I'm gonna extrapolate those numbers over the course of 12 months. If total sells stay exactly the same (and do not increase exponentially as the data suggests that they most certainly will) the 3 month total X 4 equals $169,755,092.

That's almost $170 million in new found economic dollars that could boom ANY state in the union. And everyone knows that most every city in most every state could use that kind of.. stimulus. If the numbers continue to grow exponentially, that number will likely fall closer to the YTD total of something like $250-$300 Million. Or put another way, a quarter of a BILLION dollars. Just sayin'. Also, don't forget that only a small number of cities in the whole state of Colorado are actually participating. If and when all the cities from the whole state join in, imagine what that number would be. Would you consider it crazy to imagine a full BILLION dollars added into their economy in a year's time thanks to revenue generated from legalized marijuana? ... I can imagine more myself, especially when you consider that these numbers only include recreational sales and not medical. Imagine combining the total revenues of both, with every city and town in the state participating with full force. Looking at it that way, which will likely some day be Colorado's reality, a Billion dollars shouldn't sound nearly as far fetched. When that day comes, there will longer be the need for 'medical' and 'recreational'. It will just be marijuana, just like alcohol is just alcohol. (Funny thought, medical alcohol vs recreational booze.)

Anyways, that's the total amount of revenue. Let me show you what that equates to in tax dollars. Here is an excerpt from a PolicyMic.com article, citing the first 3 month's of sales tax generated, and some tax transfers for the state of Colorado with recreational marijuana revenue:

Retail marijuana sales taxes brought in $1.4 million in January, $1.43 million in February and now $1.898 million in March — a clear upward trajectory. And total marijuana tax transfers and distributions went from $2.927 million in January to $4.077 million in March. And perhaps more importantly, while it's still somewhat early, the up-trending numbers indicate that initial sales weren't simply the result of "new-toy" excitement wherein everyone was buying pot just because they could. Coloradans wanted marijuana before, and they still do now.

So, for January-March, Colorado is seeing ever-increasing, real hard cash generated with their new legal plant sales. That totals $4.728 Million for sales tax in the first three months alone. Extrapolating that out over the course of a year, and Colorado will find itself in a situation of needing to spend somewhere in the ballpark of $18.912 Million dollars in newly found tax revenue. That's almost $19 Million. (I came up with that number by multiplying 4.728 x 4.) Not bad at all.

In fact, "Legal cannabis sales in the United States are projected to reach as high as $2.57 billion this year, split among the 21 states that allow the sale of some form of marijuana. That's up from $1.53 billion a year ago. As time goes on, the marijuana industry will grow its own stakeholders and perhaps become a political lobby in its own right." (Another exert from the PolicyMic.com article.)



Final Thoughts

So with crime down and revenue considerably up, what's the downside to everyone else following suit? Well, keep in mind that all the data I've presented (and really all the other data currently out there) is in its infancy. We are in reality talking about changing the course of history and drug policy in very big way. A way that will forever change the landscape of countless economic and cultural institutions across the world, not just our nation. Not to mention changing the collective mindset of everyone in this nation that has been brainwashed into thinking that marijuana is some great boogeyman is no easy feat. That kind of momentum does not and will not change overnight. But collective mindsets are changing, albeit slower than I would I like to see. Regardless, progress is still progress. Here's a current polling on marijuana to elucidate that sentiment, an exert from an NPR article citing recent numbers:

Most people said that allowing use of marijuana for medical purposes is a good idea, with 78 percent saying they're in favor of that. But they were much less positive about legalizing recreational marijuana, as the states of Colorado and Washington have done. Less than half of respondents, 43 percent, backed legalization.

A great majority of Americans are becoming increasingly FOR the idea of medical marijuana in this country. Those numbers are way up from 10 years ago. Dramatically up. And 43 percent is a notably marked improvement as well with public opinion. The sea change began long ago.

The country and all of its many members and representatives are no doubt going to want to see much more than 3-6 months of data from one city in one state of the union before the entirety of the US says "Let's do this thing!". I realize that. But, you can't argue against the initial success that Colorado is having in the early throws of this process. Many see Colorado and eventually Washington state too as being the incubators of marijuana legalization. The grand experiment. If it continues to go well, time is the only thing holding the nation back from eventual, full legalization of recreational marijuana. Time will come slowly, but it will come. And money always talks the loudest. With Denver and it's state showing the world that increased revenue doesn't have to come at the price of anarchy on the streets (what a stupid f****ing argument that was) the big boys and girls in D.C. will see lobby efforts storm their doors to get this legal, sooner than later. In that way, money isn't evil at all.
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