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Marijuana and money
Wisconsin residents pay tens of millions of dollars in taxes on purchases of marijuana and THC products each year, but the state sees none of the revenue those taxes generate because they instead go to neighboring states which have legalized it. Recreational and medicinal sale and use of marijuana is now legal in Illinois, Michigan and Minnesota. Iowa allows limited sales and possession for medicinal use only. It leaves Wisconsin as an island among states in the Upper Midwest.
Numerous polls indicate strong majority support among Wisconsin residents for legalization but legislative efforts to do so have stalled because Republicans, who control both houses of the legislature, have resisted any initiatives which would allow for personal use of marijuana. Senator Chris Larson (D-Milwaukee) said he believes reform of the state’s marijuana laws will never happen as long as a Republican majority is in power. “The public is very educated on this,” he said. “More than two-thirds of the state wants legalized recreational cannabis but we have a group of regressive Republican dinosaurs who think they represent the majority because they’ve been gerrymandered into believing it for the last decade. If the people of the state want legalized weed, they’ll have to vote those guys out.” Larson said he is hopeful that new legislative district maps which have been ordered by the Wisconsin Supreme Court’s new liberal majority will make that a more realistic possibility.
Proponents of legalization say the recalcitrance of GOP lawmakers means Wisconsin is losing an opportunity to generate hundreds of millions of dollars of its own tax revenue and is ignoring the potential for thousands of new agricultural, manufacturing and retail jobs and careers which would arise with a legalized marijuana industry in the state. An analysis by the nonpartisan Legislative Fiscal Bureau of a full legalization plan, which was included in Democratic Governor Tony Evers’s proposed state budget last year, showed that legal, regulated and taxed sales of marijuana and related products would result in an additional $166 million in revenue annually. Republicans removed the measure from the budget. GOP leaders in the Senate and Assembly have also refused to allow several Democratic bills which would establish a system of legalization based on successful models developed in other states to even come to the legislative floor for public hearings and debate.
Legalization is a Sensible Move
In September, Senator Melissa Agard (D-Madison) and Representative Darrin B. Madison (D-Milwaukee) introduced a measure which would make Wisconsin the 39th state to broadly legalize cannabis in some form. It would become the 25th state to legalize recreational use of it. Agard said there are myriad reasons which make legalization a sensible move, among them the economic opportunities it would provide to local communities. The bill, like those passed in Illinois, Michigan and Minnesota would direct much of the expected tax revenue to local governments.
State officials in Illinois, which legalized recreational sales and possession in 2019, reported that as much as 30 percent of its $1.5 billion in marijuana sales in 2022 were made to residents of other states, including Wisconsin. Illinois reported $445 million in tax revenues from the sale of cannabis. Wisconsin’s nonpartisan Legislative Fiscal Bureau estimated that $36 million of the tax revenues in Illinois were paid by Wisconsinites who crossed the border to make purchases. Michigan, which made sales legal in 2018, reported $1.8 billion in total sales during the most recent fiscal year which ended in October, generating $266 million in tax revenue.
While Michigan doesn’t track the percentage of sales which were made to non-residents, operators of marijuana dispensaries close to its borders estimate that about half of their sales are made to residents of other states. Legalized sales of some cannabis products began only last year in Minnesota and its system of dispensaries which can sell smokable, or “flower” forms of the plant won’t be fully operational until later this year so sales figures there, including the percentage which are made to non-residents, have not yet been calculated.
But Larson said lost revenue from a failure to legalize marijuana use and sales in Wisconsin is only one part of a larger picture. “An even worse part of it being criminalized here is in the human cost of still having people arrested for it,” he said. “Statistics from just two years ago show that 57 percent of the drug arrests made in our state are for marijuana possession. It costs about $38,000 a year to incarcerate someone. So, it’s wasting the time of police and the judicial system. It’s wasting state resources. It’s just dumb on every possible level.”
Community Uplift
Agard agrees, pointing out that additional tax revenue is just one aspect of the purpose behind the legislation. “We know that lifting up our communities with these dollars is certainly a good thing but there are reasons beyond the fiscal,” she said. “There are real moral implications to legalizing cannabis like addressing racial disparities in drug enforcement, in honoring people’s individual liberties and freedoms and in lifting up our state’s agricultural heritage that all comes along with it. I think those things are even more important than fiscal considerations of the dollars coming into the state which are really an added benefit, sort of like putting frosting on the cake.”
A Republican sponsored bill was introduced in the Assembly by Speaker Robin Vos in early January which would create a system for legalized sales and use of non-smokable marijuana products such as oils and edibles for medical purposes only. But, unlike other states which have some form of legalization, the bill would prohibit privately owned marijuana business operations. Under its provisions, Wisconsin would become the first state to have state-run dispensaries. They would be staffed by pharmacists employed by the Department of Health Services (DHS) and would be administered by a newly formed Office of Medical Cannabis Regulation. The Department of Agriculture, Trade and Consumer Protection (DATCP) would be responsible for overseeing the cultivation, processing and testing of the medicinal products. The bill would also restrict sales to people with certain qualifying medical conditions and would permit a maximum of just five regional dispensaries statewide. Cultivation and sales of smokable plant forms of marijuana would still be illegal. It would also allow private employers to prohibit the use of cannabis by workers even if it’s used lawfully under the medical marijuana program.
Even though she has pushed for various forms of marijuana legalization for a decade, Agard said she is opposed to the proposed Assembly bill. “It’s smoke and mirrors, it’s not real,” she said. “Vos knows how to legislate and when he wants to get things done, he can get things done. But he and his Republican colleagues in the Assembly didn’t collaborate or communicate with advocates across the state or with his colleagues in the Senate. He didn’t reach across party lines despite my offers time and time again to be involved in conversations. It’s clear from my discussions with Senate Republicans that this Assembly bill is going nowhere. It’s also clear, by coming out of the gate and saying that this bill will be the most restrictive medicinal bill in the nation, that Vos is out of touch with what the people of Wisconsin are asking for. The bill misses the mark entirely.”
Evers has said he would consider signing the bill if passed, agreeing with several Democratic state lawmakers who say the move would at least be a small step toward full legalization. However, some Republican lawmakers, including Vos, have said Democrats should not view the legislation as a precursor to eventual legalization for recreational marijuana sales and use, warning that framing the bill in that manner will make even Republicans who would otherwise vote for the bill less likely to support it.
Political Camouflage
Larson said he doesn’t believe the Republican bill in the Assembly has any chance of becoming law anyway. “The bill is trash,” he said. “It’s designed as the worst kind of political camouflage that Vos could think of. If you had to come up with a bill that was impossible to pass and, even if it was passed, would be impossible to implement in a way that actually benefit anybody, this is what you’d come up with.”
States which have legalized recreational use, sales and individual and industrial cultivation of marijuana have seen significant economic stimulus from it. But Agard said Wisconsin’s status as an “island of prohibition” prevents the state from seeing any of those benefits. “Folks are opening up shops in other states rather than putting down roots here in Wisconsin. We’re just consistently behind the curve on it,” she said.
Like Larson, Agard said she is hopeful that fairer legislative maps will provide an opportunity for voters to have a more responsive state government which will listen to and act on their concerns. “The reason we haven’t been able to get this over the finish line is that Republicans view it as a partisan conversation,” she said. “But it’s very much like so many other issues in that the vast majority of people in Wisconsin, even most Republicans, support legalized cannabis for responsible adult usage. That’s a mandate and we need to be thinking about that when it comes to policy. On that same list of mandates are reproductive freedoms, expansion of health care, PFAS contamination, funding our public schools and addressing our childcare crisis. These are things that folks in Wisconsin, regardless of who it is they vote for or who is at the top of the ticket, care deeply about. But because of the deep division in our legislature, we aren’t able to get these things done.”
Despite entrenched and seemingly intractable partisan divisions, Agard said she is more hopeful now than ever before that progress on major issues will be forthcoming because of the Wisconsin Supreme Court’s willingness to address gerrymandering. “If and when the legislature and the capitol building become more balanced and they better reflect the actual people of the state, we’ll be better able to engage in conversations with each other that address the real concerns which matter to the people of Wisconsin. Cannabis is pretty close to the top of that list,” she said.
Meanwhile, at border dispensaries in Illinois, the Upper Peninsula of Michigan and Minnesota, the lines of cars in the parking lots of marijuana dispensaries show a high concentration of Wisconsin license plates. A Wisconsin resident who spoke to Shepherd Express but didn’t want her name used said she makes regular trips to Michigan to buy both smokable and edible marijuana products. “I like that it’s regulated by the state so I know exactly what I’m buying and what I’m putting in my body,” she said. “I also don’t mind paying taxes on it but I would rather have my tax dollars go toward supporting my own state.”
