January 26, 2015

Marijuana Legalization Would Bring Southern States Billions in Revenue, Thousands of Jobs

Southern farmers growing hemp

It’s no longer a secret that there is a lot of money to be made from legal marijuana. According to a recent report from the ArcView Group the legal pot business is now the fastest growing industry in the United States, which saw a staggering 74% market increase in 2014 over the previous year. So how do we in the South, a region that typically lags behind the rest of the country in economic development, cash in on this green rush? And what would be the economic impact on the South if marijuana were legalized?

Though most politicians and lawmakers will try to sell you on the notion that they are afraid of what will happen to our communities if we go down the “slippery slope” of marijuana legalization, the truth is most of the arguments our lawmakers make against ending prohibition are made for political and monetary gain, not for moral reasons. These arguments couldn’t possibly be based in fact or reason, since this country has been refining, state-by-state, the concept of marijuana legalization and how to make money from it for nearly 20 years. All of the questions have already been answered for them, yet they continue to act as if ending prohibition is a new concept.

The truth is that lawmakers toe the line for their real constituents, who are special interests and lobbyists with an agenda, the people with money to spend. Those are pharmaceutical companies, police unions, the private prison industry, the private probation industry and even gambling interests. These special interests speak the only language our lawmakers understand – money. Sick and dying children haven’t made much of a difference to them, so we will try to sell them on this argument in a language they DO understand.

The Economic Impact of Marijuana Legalization in the South

We started wondering just how much money Southern states could add to their coffers by ending the war on cannabis and creating a regulatory system like other parts of the country have done. Colorado, for instance, has been able to add millions of dollars to their budget, build schools and even provide a rebate to taxpayers because of revenues from legal marijuana. Money like that can change a LOT of lives, and no region of the country could use life-changing money like the South. So here are the numbers.

New revenue from sales and excise taxes

According to a 2014 study conducted by Nerd Wallet, legalizing marijuana nationally would add just north of $3 billion per year to tax coffers across the country by way of sales and excise tax revenues. We broke out the numbers for the South so we could get a look at what marijuana legalization would mean to our region.

State revenue from legalizing marijuana
When looking at the 10 states of Alabama, Arkansas, Florida, Georgia, Louisiana, Mississippi, North Carolina, South Carolina, Tennessee and Texas we found that marijuana legalization would add over $710 million in cold, hard cash to state tax coffers. And that number is probably low, since people who take marijuana surveys in prohibition states tend to be less than 100% truthful out of fear of getting in trouble. In other words, even though surveys show approximately 2.3 million marijuana users in the South that number is likely 10%-20% low, meaning Southern states would likely see an instant tax boost in the neighborhood of a billion dollars if we saw across the board legalization. But that’s not all of the monetary benefits associated with ending cannabis prohibition. Not by a long shot.

Savings from the criminal justice system

In an ACLU report titled The War on Marijuana and Black and White, between 2001 and 2010 there were over 8 million marijuana arrests in the United States, 88% of which were for possession. Marijuana arrests now account for over half (52%) of all drug arrests in the United States. In 2010, there was one marijuana arrest every 37 seconds, and states spent combined over $3.6 billion enforcing marijuana possession laws.

Marijuana prohibition spending by state

The South’s share of that was $839,279,369. Nearly a billion dollars was spent in the South in 2010 to arrest, prosecute and imprison people for marijuana. Not only would ending marijuana prohibition put over 800 million dollars back in to our law enforcement and court budgets, but police would be freed up to seek out and arrest criminals who truly victimize others.

Job creation, business development

In the first five months of marijuana legalization in Colorado the cannabis industry created 10,000 brand new jobs that paid between $14 and $20 per hour. Since that time many more jobs have been created as the cannabis industry in Colorado continues to grow at a breakneck rate.

What would 10,000 new jobs do for a state like Mississippi, which has the highest poverty rate and one of the lowest per-capita income rates in the country? In addition to helping people bring home a paycheck, the work created by cannabis is pumping tons of cash into state and local economies through taxes and business license fees.

10 types of jobs that would be created by the marijuana industry in the South

Beyond the direct profit states would receive by legalizing and taxing marijuana, as well as the money saved by removing criminal penalties for possessing marijuana, entrepreneurship would thrive across the South with the creation of hundreds of businesses built to service the needs of a legal cannabis industry. Some of the jobs that would be created include:

  1. Cannabis growers– There’d be no cannabis industry without growers. Many of today’s growers are college graduates in botany or horticulture or people with years of growing experience.
  2. Dispensary operators– Storefront cannabis dispensaries require owners and operators with the entrepreneurial sense to manage not only their suppliers, growers and employees, but to make sure their businesses operate within the limits of ever-changing local regulations.
  3. Dispensary employees– Marijuana retailers need a large number of employees to service customers, manage stock, meet state guidelines, etc.
  4. Security guards– Marijuana dispensaries and retail stores often deal in a lot of cash. Combine a lot of cash with something as popular as marijuana and you’ve got a whole new security industry.
  5. Renewably energy specialists– There’s a growing movement to make the cannabis industry as green as possible. Several solar panel companies across the country are helping growers harness the sun’s abundant rays to power their lighting rigs without sucking electricity from fossil fuel sources. These solar companies employ sales reps, consultants and installers, too.
  6. Delivery drivers– Some cannabis patients, like those who are wheelchair-bound, may have difficulty making it to a dispensary or grower. Drivers work independently or with storefront dispensaries to deliver cannabis to such patients.
  7. Laboratory technicians– State regulation requires testing of cannabis for things like cannabinoid content, pesticides and mold.
  8. Marketing agencies– Like any business, cannabis-related operations need to be able to advertise their product or service.
  9. Attorneys– Licensing and compliance for dispensary owners is both an extensive as well as an expensive process. Attorneys specializing in marijuana law will be needed to help setup businesses and guide owners through the tricky waters.
  10. Government employees– Regulation requires people to review applications, enforcement agents, tax collectors and office staff. Marijuana legalization not only creates these important government jobs, it pays for their salary as well.

Does it make sense that we are not taking advantage of the green rush?

Of course not. All of the important questions have already been answered about marijuana, it’s now a matter of convincing as many people as possible that we deserve to benefit economically from it too. Over 150 million Americans now have legal access to recreational or medical marijuana and there are no valid arguments against ending prohibition left. If southern lawmakers aren’t going to pay attention to the patients then maybe the numbers will get their attention.

7 thoughts on “Marijuana Legalization Would Bring Southern States Billions in Revenue, Thousands of Jobs

  1. Great Article! We need more Great Press like this to help us Legalize Mississippi,We need signatures of registered voters to put it to a public vote in 2016 ballot Initiative 48 in MS. support our efforts to fully legalize Marijuana and Hemp and Free those who have been incarcerated for non violent pot crimes.so many with cancer could be treated with cannabis like in my own family if it were legal.Help Us Legalize Mississippi Support Initiative 48

  2. Take it out of the dark alleys and back rooms and put it in a lighted showcase. It is not a scary transition. It is a gift from God/Universe to use for healing. Dis~ease comes in many forms healing comes in one… Imagine the relief of being able to walk into a store to purchase this wonderful plant, not being filled with fear on the drive home because you are “holding”…. I’ve lived in Ms, still have a home there, but live in WA state now. We want to retire back in Ms, but we are waiting for legalization to come to the state of Ms. Please don’t make me wait too much longer.

  3. It would take a lot of solar panels, deep cycle batteries, and inverters to power who knows how many grow lights anywhere from 11-24 hours a day depending on plant stage, ventilation, and climate control. Especially when the climate of the location is considered. That sounds a little left field.

  4. As a southern weed lover I’d love to see this implemented but I just don’t see it happening here, the people and politicians are too backwards.

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