Election

Marijuana's 2021 Election Results: Tax Increases Fail, Six Cities Consider Dispensaries

Marijuana tax increases and retail marijuana bans were on Colorado ballots.
Marijuana tax increases and retail marijuana bans were on Colorado ballots. Jake Holschuh.
Marijuana took up a fair share of space on 2021 election ballots in Colorado.

Colorado voters considered a controversial statewide proposition that called for increasing marijuana taxes to support out-of-school learning, while eight Colorado cities voted on local pot measures involving everything from more sales tax increases to the end of dispensary bans.

Here are the results:

Proposition 119
The only marijuana-related question on the statewide ballot, Prop 119 failed despite endorsements from Governor Jared Polis and several other influential political figures, including former governors Bill Ritter and Bill Owens and former Denver mayors Wellington Webb and Federico Peña.


If it had passed, 119 would have created the State Learning Enrichment and Academic Progress Initiative (LEAP), a program of annual stipends to cover out-of-school learning services. A 5 percent recreational marijuana sales tax increase and the repurposing of a portion of investment revenue derived from leases, rents and royalties paid for state-owned lands would have funded the program.

Cannabis consumers were concerned by the proposed tax increase, given that Colorado currently imposes a 15 percent special tax on recreational marijuana sales and local governments add their own taxes on top of that. (If approved, the ballot initiative would have raised the overall marijuana sales tax in Denver from 26.41 percent to 31.41 percent.) But the educational community may have played the bigger role in 119's failure.

The LEAP program faced increased criticism from educators in recent months, with some questioning how accessible LEAP stipends would be for rural and low-income students and others saying they would prefer public schools got the money directly. Providers of free out-of-school programming opposed the proposed funding allocation as well, as only for-cost services would have been eligible for LEAP.

Oversight of the board that would have overseen how LEAP funds were spent also came under attack. Under 119's language, the board would have been appointed by the governor and replaced every three years by the governor, but only from a list of candidates created by current LEAP boardmembers — and without any legislative oversight.


LEAP proponents argued that out-of-school education is a big factor in achievement gaps among students, and that the stipends were intended for students from low- and middle-income families. The effort received powerful support beyond politicians, including from organizations like Mile High Early Learning, Servicios de la Raza and Gary Community Ventures, a nonprofit that spent nearly $1 million pushing the proposal.

All of the financial and political support wasn't enough to push 119 through, however. The proposition trailed from the start as results were announced, and Vote Yes on 119, the organization behind LEAP, conceded before the night ended, eventually losing by almost 9 percent.

“The significant gap in achievement between students from wealthy families and their low-income peers has been an unfortunate educational outcome in Colorado for years — and tonight’s results mean it will likely continue to get worse before it gets better,” Vote Yes on 119 spokesman Curtis Hubbard said in a statement as the proponents conceded. “Access to affordable, quality after-school education services is not a possibility for many families living in Colorado — and we will work with anyone who has a better idea on how to tackle the problem.”

While the marijuana industry was worried about more than one potential tax increase, 119 was the biggest threat.

“Tonight, Colorado voters made clear that they are not willing to raise taxes at the expense of cannabis patients and consumers for special interests that don’t benefit the majority of Coloradans,” Marijuana Industry Group Executive Director Truman Bradley said in a statement as the outcome became clear. “The cannabis community truly values our ability to support causes Colorado cares about like public safety, mental health, substance abuse, youth prevention education, and affordable housing. In fact, we have given more than $425 million to these and to other state and local government programs to date."

Denver
Although not as publicized, Denver had its own controversial tax hike on recreational pot sales on the local ballot. Initiative 300: Pandemic Research Fund would have raised the city’s recreational marijuana sales by 1.5 percent to fund pandemic research and public-response plans during pandemics. According to proponents of the measure, around $7 million would have been raised annually by the tax increase for research by the University of Colorado Denver CityCenter — a partnership of CU Denver, the City of Denver and local businesses.

A CU Denver spokeswoman told Westword that the school “did not initiate this proposal, is not involved in the campaign or signature-gathering process, and has not taken a position on this proposed ballot initiative.” Still, more than $540,000 was spent on the initiative’s campaign by Guarding Against Pandemics, a group registered in Delaware with ties to cryptocurrency investor Sam Bankman-Fried.

Denver Mayor Michael Hancock opposed I-300, and so did marijuana stakeholders. By night's end, I-300 lost with just over 40 percent of the vote.

“Denver voters recognized that this measure — funded by an out-of-town billionaire — taxes people’s pain relief to pay for a random, pandemic preparation program that has no accountability, no oversight, no specific solutions, no connection to the marijuana industry and no relationship to core city services,” Chuck Smith, board president of marijuana industry organization Colorado Leads, said in a statement. “We are hopeful that the city’s business community will oppose any future efforts to increase taxes on the Denver cannabis industry just as they would for any other industry in the city.”

Lakewood
Tax increases on recreational marijuana sales went 0-3 across the Denver area after Lakewood's results came in.  A year after Lakewood voters approved recreational marijuana sales, the Lakewood City Council had approved a ballot initiative that would have created special marijuana sales and excise taxes similar to those in many municipalities that allow recreational pot sales. The special marijuana taxes would have been set at 5 percent if approved, while the City of Lakewood would have had the right to raise the tax up to 10 percent without further voter approval. The tax increase would have raised around $2.9 million per year for Lakewood, according to city estimates, with the money going to marijuana business regulation and enforcement, public-health programs and education associated with pot use, as well as "other general expenses of the city."

This measure failed, with over 58 percent of voters rejecting it. As a result, Lakewood’s overall sales tax rate for recreational marijuana purchases will remain at 19.6 percent.
click to enlarge Golden's lone medical marijuana dispensary may stay that way. - COURTESY OF GOLDEN ALTERNATIVE MEDICINE
Golden's lone medical marijuana dispensary may stay that way.
Courtesy of Golden Alternative Medicine
Golden
A ballot initiative proposing recreational marijuana sales in Golden was still too close by the end of November 2, with just over 50 percent of voters going for the proposal. However, a separate ballot question proposing a 6 percent special sales and excise tax on potential recreational pot sales passed by a wide margin. According to city estimates, the new tax would raise around $900,000 in tax revenue per year.

But first, Golden voters must pass the measure that would allow marijuana sales. It was left intentionally broad so that the Golden council could draft and implement rules, including a licensing structure and potential social equity resolutions, if both measures are approved.

Westminster
Westminster's marijuana recreational sales initiative also leads by a slim margin, though the 53 percent of "yes" votes should be enough for a victory. Even so, Westminster probably won't be getting dispensaries soon.

Under the ballot measures crafted by Westminster City Council earlier this year, marijuana businesses could only come to town if Westminster voters approved a separate measure creating a special sales tax of 5 percent on pot sales — and they didn't, striking down the tax by a 5 percent margin. The new tax revenue from the special sales tax would've raised an estimated $2 million annually.

Brighton
Brighton voters had to consider two separate marijuana issues in one question this year: repealing the town's ban on recreational marijuana sales, and creating a 4 percent special sales tax on dispensary sales. Over 52 percent of voters rejected the measure, however, leaving Brighton on a shrinking list of Denver suburbs that don't allow commercial pot.

Wellington
After a hotly contested attempt to get marijuana sales on the 2020 ballot failed, Wellington voters still haven't decided whether to allow dispensaries in town. As of 11 p.m. November 2, a referendum proposing marijuana sales trailed by 48 votes, leaving it too close to call. According to the Larimer County Clerk, ballot counting resumed at 9 a.m. today.

As of last night, another ballot question creating a 3.5 percent sales tax on recreational marijuana purchases was over 200 votes ahead.

Lamar
Located just over thirty minutes from the Kansas border in Prowers County, Lamar banned marijuana sales in 2010. However, Lamar City Council revisited the issue this summer, approving two separate ballot questions that would permit medical and recreational marijuana businesses while creating special sales and excise taxes on recreational pot sales and transactions.

With 85 percent of precincts reporting, Question 2B, which would end Lamar's ban on medical and recreational marijuana businesses, was in the lead with 54 percent of votes, while Ballot Issue 2A, a proposed special tax on recreational marijuana sales and wholesale transactions, led by a 10 percent margin.

Mead

Mead has prohibited medical marijuana sales since 2011 and preemptively banned recreational marijuana sales in 2013 — a ban that Mead voters upheld in 2019. A citizen initiative was submitted in July with enough signatures to again ask Mead voters to repeal the local ban on medical and recreational marijuana sales, but the effort has failed once more, according to Weld County's unofficial results, which show that over 61 percent of voters rejected a measure allowing pot businesses. A separate question creating a special sales tax was approved, however, so if the ban is ever repealed, a tax will be in place.
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Thomas Mitchell has written about all things cannabis for Westword since 2014, covering sports, real estate and general news along the way for publications such as the Arizona Republic, Inman and Fox Sports. He's currently the cannabis editor for westword.com.
Contact: Thomas Mitchell