The proposal for the marijuana tax increase stems from a decision by Aurora voters to remove the city's red light traffic cameras in 2018, which was generating around $2 million in city revenue per year that went toward several mental health and safety organizations. With that money gone, the city council's marijuana committee has considered marijuana sales as a way to help restore financial support for these programs.
According to city projections, raising the marijuana tax would generate about $1 million annually in tax revenue; the increase would add less than 50 cents on to most purchases.
“We looked at how to raise money for these important programs, and felt that we could raise the marijuana tax rate by an additional 1 percent,” says Aurora Mayor Mike Coffman, who supports the proposal. “That way, we can raise necessary funds for these programs, and we’re actually still half a point under Denver when it comes to taxing marijuana.”
In 2014, Aurora voters approved up to a 10 percent excise and special sales tax on recreational marijuana. Currently, the marijuana sales tax sits at 4 percent, so a 1 percent increase is still well within the limit. Denver recently did something similar, raising the local marijuana sales tax from 3.3 percent to 5.5 percent in 2018 to help fund an affordable-housing initiative.
The organizations that would receive funding from the proposed increase in Aurora are the Aurora Mental Health Center, Gateway Domestic Violence Services, Mile High Behavioral Health, thenGang Rescue and Support Project, SungateKids and the Juvenile Assessment Center.
“Mental health and domestic violence are critical issues in the community,” says Angela Lawson, the councilwoman pushing the increase. “The money is for backing these programs, because if they don’t have that funding, they could go away.”
There are approximately 24 dispensaries in Aurora. Terrapin Care Station, a Colorado dispensary chain with two stores in Aurora, believes that lower taxes is a component in keeping the black market at bay, but takes a hands-off approach with how localities decide to tax marijuana.
“When it comes to cannabis’ impact on local communities, the voters, policy-makers and residents of those communities are the best to weigh in on what’s right for their communities. It’s critical that we keep taxes low enough so that we don’t empower a black market," a Terrapin statement sent to Westword reads. "But what that rate looks like, and how a community applies that revenue, is a conversation for the community as a whole; not for the cannabis industry to dictate.”
Coffman says the new funding is a good look for the pot industry, and doesn't expect much pushing back.
“I don’t think there’s going to be any opposition from the community,” he predicts. “We’re raising necessary funds for these programs while still allowing marijuana businesses in the city to stay competitive. It allows both marijuana and these important programs to work together.”