South Dakota voters could boost funding to teachers and reduce the state’s sales tax burden by supporting a ballot measure aimed at legalizing marijuana for recreational use.
And the measure’s sponsors are hoping to emphasize that point as they ask voters to sign petitions that could put the question on the 2018 ballot.
Under the proposal, South Dakota residents 21 and older would be able to legally possess and use one ounce of cannabis or grow five marijuana plants. Non-residents would be limited to a quarter ounce.
As part of the measure, sales and excise tax collected for the sale and transfer of marijuana could flow to the Department of Education for teacher pay and school supplies, to the Department of Health for drug prevention and abuse education campaigns and to law enforcement agencies to help police illegal drug use and sale.
Proponents say that revenue stream should be enough to sell skeptical voters, while opponents have said South Dakotans don’t want to legalize the drug for recreational use, and its profitability in the state remains unclear.
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“Quit raising my taxes and start taxing this industry we already have in South Dakota,” said Melissa Mentele, director of cannabis advocacy group New Approach South Dakota. “We’re going to take something that’s costing our state to prosecute cannabis cases, we’re going to tax cannabis instead and use that money to educate our children.”
Mentele pointed to Colorado as an indicator of the success South Dakota could see if it passed the proposal. Colorado sales and excise taxes on recreational marijuana last year brought in $54.2 million for schools. She said summer travel to South Dakota, especially during the Sturgis Motorcycle Rally, could put the state on pace to bring in more revenue for recreational marijuana.
South Dakota Republicans have acknowledged that the state faces a challenge in bringing in enough revenue to run government offices and programs. But despite that, they said they don’t foresee a future in which recreational cannabis would be the solution.
“Never. Absolutely not,” said South Dakota House Speaker Mark Mickelson, R-Sioux Falls. “Tax yourself for something you need, don’t tax someone else for their path to destruction.”
Sen. Larry Tidemann, R-Brookings, chairs the state’s Joint Committee on Appropriations. He said he wasn’t convinced that passing the proposal would bring in as much funding as proponents said.
“I don’t think we have enough people in the state to generate enough revenue,” Tidemann said. “We don’t even have as many people as Denver.”
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And even if voters did approve the proposal, Tidemann said he wasn’t sure that the state could legally handle the money used to buy and sell marijuana in the state. Banks have been reluctant to accept money from cannabis producers or vendors elsewhere as the drug remains federally illegal.
“How can you legally give the money to the state when you can’t even give it to the bank?,” he said.
Mary McCorkle, president of the South Dakota Education Association, said the state has used similar issues, like video lottery, to avoid having meaningful dialogues about education funding in the past.
“What it does is it makes it harder to have the kinds of conversations we need to have about school funding,” she said. “Just because something will benefit South Dakota doesn’t mean it’s right for the state.”
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Mentele said her aim in bringing the proposal was to eliminate the black market for marijuana that exists in the state. She is also carrying a ballot measure that would legalize small amounts of cannabis for medical use.
Law enforcement groups have voiced opposition to both proposals and say they oppose legalization for full medical or recreational use without a federal law change or guidance from national medical organizations.
Attorney General Marty Jackley in his explanation of the measure said parts of the proposal could be found unconstitutional.
The push to expand legal access to marijuana hasn’t translated at the federal level. The drug remains a Class I scheduled drug and the Drug Enforcement Administration said earlier this year that it doesn’t plan to make marijuana legal for any purpose.
While federal law trumps state law, the DEA hasn’t acted in states that have approved marijuana for medical use or that have legalized small amounts of the drug for recreational use.
credit: argusleader.com