The Department of Treasury in Michigan announced on Friday that it will be distributing approximately $100m in cannabis tax revenue to 302 local communities and tribes. Detroit stands out as it will receive over $3m, the largest amount that any community in the state will receive.
Every eligible county and municipality will get just over $58,000 for each retail store or microbusiness licensed to conduct operations within that jurisdiction. This sum was calculated based on the excise tax of 10% levied on all adult-use marijuana sales. This unit share is nearly the same as what was distributed last year when $87m was shared out among 269 counties and municipalities.
Last year, Detroit also stood out as the biggest recipient of the money distributed. Last year was also the first time that these cannabis taxes were distributed to the jurisdictions hosting cannabis retail establishments after adult-use sales started. In that maiden year of these distributions, Wayne County received the lion’s share when compared to other counties in the state. This year will be no different as the county is slated to receive $5m, a sum that exceeds what any other county will receive.
This year’s distribution features a new category of recipients; four tribes that are recognized federally and are found in Michigan will share close to a million dollars from these excise taxes on recreational marijuana. The inclusion of these tribes comes after the state modified its laws.
The ED of the Cannabis Regulatory Authority in Michigan, Brian Hanna, stated in a press release that tribes, municipalities and counties benefit in many ways from the marijuana businesses hosted in their jurisdictions. These benefits, he added, included employment opportunities that pay well, increased revenues to fund key priorities of the jurisdictions, as well as the community involvement of the businesses. He then explained that this particular fraction of excise taxes on marijuana was an added benefit through which communities can fund programs and activities that help their people.
It should be noted that the $100m going to counties, tribes and municipalities isn’t the only money from cannabis taxes that is being distributed. State law includes other recipients for portions of these funds and this year, at least $116m is going to the School Aid Fund targeting K-12 education and the Transportation Fund of the state will also receive $116m.
The cannabis industry, including firms like Cresco Labs Inc. (CSE: CL) (OTCQX: CRLBF), is likely to be immensely pleased that the legalization of marijuana in Michigan is proving to be a force for community transformation through the annual distribution of such huge amounts of money to counties, cities and tribes to support their social programs.
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