Cannabis Taxes Could Be A Huge Funding Source for Libraries
Libraries must start actively advocating for funding opportunities from this rapidly expanding industry.
In 2012, Colorado became the first state to legalize the recreational sale and use of cannabis. Since then, 18 other states, along with Washington, D.C., and Guam, have followed suit. With legalization has come hundreds of millions of dollars in tax revenue, and some states, like California, have even surpassed $1 billion in new funds since passing legalization.
According to Newsweek, that revenue is going towards improving a number of state budget items, including mental health treatment, substance abuse programs, and public education. On the other hand, Libraries have largely been left out of this windfall. Still, cannabis taxes have the potential to play a considerable role in library funding now and in the future.
If libraries hope to receive these benefits, they must start actively advocating for funding opportunities from this rapidly expanding industry. That’s according to a recent whitepaper from the EveryLibrary Institute, which calls for libraries to begin working with lawmakers to ensure they get their share of this new revenue stream.
“Cannabis taxes are a huge potential source of funding that libraries should not be left out of,” write authors Megan Blair, EveryLibrary’s Policy and Advocacy Strategist, and John Chrastka, EveryLibrary Executive Director. “Libraries in states with current recreational cannabis should be actively working with state legislatures to allocate funding from tax revenue. In states that have not yet legalized recreational cannabis, libraries have an opportunity to anticipate and influence the future allocation of tax revenue.”
Download Cannabis Tax Policy and Libraries Whitepaper
A New Revenue Stream
Recreational cannabis is taxed by states in several ways, including a traditional sales tax as well as an excise tax — sometimes called a “sin tax” — which is levied on certain goods like cigarettes and alcohol. State governments collect revenue from both the excise and the sales tax.
Unlike medical cannabis, which is taxed at a significantly lower rate and whose revenue is often earmarked in very specific ways, tax policies on recreational cannabis are generally left to the state’s discretion and allow for more freedom for policymakers to decide how that revenue is allocated.
Each state that has legalized cannabis has used its new tax revenue to fund various programs, including education, public safety, and drug prevention programs. State general funds, which go towards education, health care, and other operating costs, have also benefited from these taxes. New Mexico, for example, has used the cannabis tax to help stimulate its general fund, of which over half is used for education, including higher education.
The Many Roles of the Library
Libraries sit at a natural intersection of many of the types of programs typically being funded through cannabis tax revenue, and the paper recommends that libraries highlight the myriad ways they are an extension of public education. An early literacy program run out of the public library is a perfect example. Still, it will be up to advocates to make those connections explicit for both legislators and voters.
Many states have also added equity initiatives to their legalization efforts. State library associations can position their libraries as a resource for those interested in learning more about the cannabis industry and even opening their own businesses. Libraries in low-income communities are particularly well-positioned for this work.
Meanwhile, half the states that sell recreational cannabis also include a local option sales tax. That revenue stays directly with the cities and towns where cannabis businesses operate. That revenue can be used in any way those cities and towns see fit.
In communities with a local tax, libraries have the ability to lobby their local government for funding from these local taxes, and some have already started to take advantage. In 2019, residents of Craig, Colorado, passed a ballot measure to use marijuana tax revenue to fund their Moffat County Library and Museum.
Libraries and Legislation
It’s not just about asking for money, though. Libraries and their advocates can also take an active role in actually shaping the legislation that determines how revenue is used. In Massachusetts, for example, where legalization passed through a ballot initiative, the language surrounding the allocation of revenue was vaguely written, leaving the responsibility of where cannabis tax revenue would go to the state legislature and providing library advocates in the state with a path to lobbying for funding for their libraries and library programs.
As the stigma of cannabis use and sales has begun to fade, the paper also recommends that state library associations consider joining policy-focused coalitions in their states. There are many such organizations, including the National Cannabis Industry Association, the National Cannabis Roundtable, and the Marijuana Policy Project, with strong state-level chapters that advocates can partner with. These will be essential relationships to ensure that libraries are considered in ballot initiatives and legislation.
A Singular Opportunity
Even though cannabis legalization is still relatively new, the paper concludes that now is the perfect time for library advocates to push to receive revenue as states continue to amend where their cannabis revenue is going. And in states that have yet to legalize, library advocates should be meeting with legislatures to discuss future funding opportunities.
“Libraries have a singular opportunity to boost their funding and their role in our communities,” the paper says. “Library advocates should not be afraid to work with other community groups fighting for cannabis revenue. Now more than ever, libraries are under attack. It is important to build coalitions with groups with similar goals and priorities.”
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