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Virginia is near legalizing leisure herbs as different states hold tabs on hashish tax breaks

A customer sets fire to a shop in Lowell Farms, America's first official cannabis cafe serving farm-to-table dining and smoking cannabis on October 1, 2019 in West Hollywood, California.

Mike Blake | Reuters

Virginia is on the verge of becoming the first southern state to generate high tax revenues when it comes to legalizing recreational herbs.

A bill passed on Sunday Democratic Governor Ralph Northam's signature awaits in both the State House of Representatives and the Senate.

Once signed, the Old Dominion would officially join 15 other states and the District of Columbia that have legalized marijuana for recreational adult use. Under Virginia law, legal sales and ownership would not take effect until 2024.

States from Wisconsin to Kansas – many of them suffering from the Covid pandemic – are calling for similar measures as they struggle to balance their budgets. The governors also cite racial justice as a reason for legalizing marijuana. Black and Latin American men across the country are more likely to be incarcerated than their white counterparts for the same offenses.

Support for marijuana legalization has grown steadily over the years. Recent Gallup polls found that 68% of adults in the US think marijuana should be legalized for recreational use, up from 66% last year. With Democratic President Joe Biden in the White House and the party currently holding a majority in both the House of Representatives and Senate, federal marijuana legalization could be closer than ever.

For now, however, it remains a state-to-state decision.

New Jersey is the youngest to join the party. Democratic Governor Phil Murphy signed a reform bill in late February after voters approved the measure in November. A report by the bipartisan think tank New Jersey Policy Perspective estimates the state could generate at least $ 300 million in tax revenue annually.

For Virginia, legalizing pots could bring in $ 698 million to $ 1.2 billion annually in economic activity and up to $ 274 million in tax revenue annually, according to a study by the governors' office.

Northam also acknowledged racial differences in drug abuse convictions in his most recent State of the Commonwealth address. "Reforming our marijuana laws is one way to ensure Virginia is a fairer state that works better for everyone," he said.

Not all constituents are happy with the pace of change. The American Civil Liberties Union of Virginia said the legislation paid "lip service" but "does nothing to address the persistent racial gaps we see decriminalizing through 2024," reported WWBT, an NBC partner in television Richmond, Virginia.

A governor's spokesman told CNBC: "We have a lot of work to do, but this bill will help reinvest in our communities and reduce inequalities in our criminal justice system." The spokesman said the governor's top priority is making sure Virginia legalizes marijuana fairly.

Other governors are calling for legalization

In Pennsylvania, Governor Tom Wolf again called for marijuana legalization in his state budget address, highlighting it as a priority for this year after neighboring states either approve or are considering legalization.

"I urge lawmakers to work with me to build a foundation to strengthen the Pennsylvania economy by legalizing adult cannabis," the Democratic governor said in a message to lawmakers in September.

The governor also highlighted racial justice as a priority for legalization. "These are proceeds that can help criminal justice-affected Pennsylvanians gain access to restorative justice programs."

Pennsylvania blacks are three times more likely to be arrested for marijuana possession than whites, according to the state's ACLU chapter. Wolf's office did not respond to a request for comment.

Highlight the cons

Washington, which was one of the first states to legalize recreational herbs in 2012, made a total of $ 395.5 million in legal marijuana tax revenue and royalties in fiscal 2019, according to the state's annual report. The legal marijuana market in the state supports more than 18,500 jobs, according to a recent study by Washington State University.

But as with many good things, there are often downsides. A University of Washington study published in the American Journal of Preventive Medicine showed that the legalization of cannabis in the state and a general change in attitudes towards the plant began to slow the downward trend in cannabis use among teenagers.

Study lead author Jennifer Bailey said, "We really don't want teenage consumption to increase," but added that it will be several decades before the effects of legalization are fully understood, as is the case with post-alcohol alcohol Prohibition was the case. She also highlighted racial justice, tax issues, and cannabis research as important benefits of legalization.

Many states are incorporating the language into cannabis legislation, according to which communities affected by racial inequalities in criminal justice will benefit most from legalization. But even guidelines developed for the benefit of color communities sometimes fail.

In Illinois, for example, a year after the state legalized the plant, there are still no minority-owned cannabis stores, even though the legislation includes language to limit pharmacies to give minority communities an advantage. The Illinois governor's office did not immediately return a request for comment.

"There is a small fraction of the people who have cash and control over the money. If you have an industry and an emerging market and you can only join when you have cash, you have already eliminated the blacks," said the Democratic La Shawn Ford, a member of the state legislature's Black Caucus, told Politico.

Government shared roadblocks

States that have split government like Wisconsin may find it more difficult to pass comprehensive cannabis reform. Democratic Governor Tony Evers recently said he would propose legalizing recreational marijuana in Wisconsin, citing potential tax revenues of more than $ 165 million a year for the state.

"The legalization and taxation of marijuana in Wisconsin – just like we already do with alcohol – ensures that a controlled market and a safe product are available for both recreational and medical users, and can open up myriad opportunities for us to be in our communities to invest and create more just state, "he said in a recent statement.

Given that Republican lawmakers currently control the Wisconsin legislature, it is unlikely to pass.

Many southern states share a similar fate. Legislators in the Mississippi House and Senate are currently fighting over the language for a medical marijuana bill after a measure mandating a state medical marijuana program was approved by Mississippi voters.

In Minnesota, HF 600 was recently the first adult recreational use bill to stand out of the state's committee. Minnesota's Senate is controlled by Republicans and the House is controlled by Democrats, diminishing the likelihood of the bill being passed. Democratic Governor Tim Walz recently urged lawmakers to consider legalizing marijuana to boost the state's economy in a briefing focused on his budget proposal. Comments from Walz's office were not immediately returned.

Even election initiatives approved by voters can go up in smoke. A Circuit Court judge appointed by Republican Governor Kristi Noem recently ruled that a constitutional amendment approved by South Dakota voters to legalize recreational marijuana was unconstitutional. The ruling said the change would have "far-reaching implications for the fundamental nature" of the state government.

Recently, Democrat Laura Kelly, Kansas governor, announced a proposal to legalize medical marijuana in the deep red state to increase the revenue needed to expand Kansas's Medicaid program to nearly 200,000 residents, who currently lack coverage. The Republican-controlled legislature is expected to reject the proposal, but Majority Leader Dan Hawkins did not take medical marijuana off the table. In a statement to Politico, he acknowledged growing support for drug reform but said it was too early to predict how the debate would develop.

In total, around 12 countries are currently considering some kind of cannabis reform legislation. States like New York, Connecticut, New Mexico, and Hawaii could soon see laws covering governors' desks.

"It's not about whether a deal comes about," New York State Senate Democratic Majority Leader Andrea Stewart-Cousins ​​told the New York Times in January. "It's about how and when."

CORRECTION: This story has been updated to reflect the University of Washington study published in the American Journal of Preventive Medicine. In a previous version, the name of the university was incorrectly entered.

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