Medford council considers pot tax
A tax on marijuana was given serious consideration by the Medford City Council on Thursday as a preemptive measure in the event pot is legalized this November and the federal government lessens criminal penalties.
“I think the prudent thing is to adopt a tax,” Councilor Daniel Bunn said. “I think we’re being pushed into a corner on this.”
However, various councilors denounced the medical marijuana dispensary program in the state and criticized the disparity between federal and state laws on pot.
“In terms of the medical marijuana program, I think it’s a farce,” Councilor Bob Strosser said.
The council decided to explore creating a contingency tax that could have a range of roughly 5 to 15 percent on all marijuana transactions.
The council earlier this year declared a permanent moratorium on medical marijuana. Councilors worry that pot could become legal under Ballot Measure 91, titled the Control, Regulation, and Taxation of Marijuana and Industrial Hemp Act of 2014.
Members fear municipalities won't be able to tax marijuana after November if the measure passes because of language written into Ballot Measure 91, which prevents cities from adopting taxes after the fact..
At the same time, the council didn’t appear to soften its stance on marijuana sales within the city because it still violates federal law.
“Somehow, I think my oath of office is more important than anything else,” Councilor Dick Gordon said.
With cannabis laws changing so quickly, Gordon said he thinks the federal government will be pushed into a corner and will eventually reschedule marijuana.
Gordon and other councilors didn’t want to set too high a tax because it could encourage black market sales of pot.
Washington and Colorado — where recreational pot is legal — are still struggling with setting the best tax rate possible to bring in revenue but not to tax too high, Deputy City Attorney Kevin MccConnell said.
“What’s happening in Washington is people are going back to the black market,” he said.
In Denver, the city has received $5 million in new tax revenue from January to June, McConnell said, though he said the state of Colorado has received less tax revenue than anticipated.
The amount of money raised from taxes could help offset the additional costs of enforcement as well as deal with health and safety issues in the city, he said.
“It looks like a significant amount of tax revenue could be lost,” McConnell said.
A person McConnell knew who visited Amsterdam recently asked a shop owner if he could see the best marijuana available. The visitor was taken to a back room and shown a jar of marijuana grown in Southern Oregon, he said.
“We have the best marijuana in the world,” McConnell said.
The councilors indicated they would like to act on a local tax before the November election.
“A lot is being put in place for some kind of preemptive taxing measure,” City Manager Eric Swanson said.
Reach reporter Damian Mann at 541-776-4476 or email@example.com. Follow him on Twitter @reporterdm.