Washington lawmakers' action needed to route pot tax funds to health care

Washington legislators must act to rededicate the revenue for low income residents.

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SEATTLE — One selling point of Washington’s new legal marijuana law was that a huge chunk of pot-related tax revenue would be devoted to health coverage for low-income residents.

But it’s not clear the money will go to health care after all.

Under the federal Affordable Care Act, also known as “Obamacare,” a would-be recipient of the pot taxes — Washington’s Basic Health Plan — is being eliminated. The plan, which provided low-cost health insurance to the working poor, is being absorbed by Medicaid and will end Dec. 31, according the state Health Care Authority.

As a result, lawmakers will need to take action if they want to rededicate the money that Initiative 502, the legal pot law passed by voters last year, intended for the Basic Health Plan. At least some of the money, which could amount to tens of millions of dollars a year, might wind up going toward local law enforcement costs or other uses.

“It would be my hope that in the spirit of the initiative the Legislature would dedicate that money into health care,” said retired state Rep. Mary Lou Dickerson, a sponsor of I-502. “In particular, mental health is a huge issue and hasn’t been properly funded.”

The state has yet to see any tax revenue from the sale of legal pot to adults over 21. The Liquor Control Board is due to begin accepting applications Nov. 18 from people seeking licenses to grow, process and sell pot for recreational reasons, with pot stores expected to open around the middle of next year.

I-502 taxes pot highly — 25 percent at least two stages and up to three, plus sales taxes. It specifies that once the money starts rolling in, every three months the state will pay $175,000 to the Department of Social and Health Services to support Washington’s “healthy youth” survey and a cost-benefit analysis of the legal-marijuana law. Some $5,000 goes to the University of Washington to publish online information about marijuana, and up to $1.25 million goes to the Liquor Control Board for the costs of administering I-502.

Of the money that’s left, half was dedicated to the Basic Health Plan.

The legal marijuana law did not carve out a share of tax revenue for cities and counties, which are facing some of the costs of its implementation, and some would like to see the Legislature remedy that.

State Rep. Christopher Hurst, the Enumclaw Democrat who leads the House committee that oversees cannabis, and Republican Sen. Ann Rivers of La Center both said they’d like to see some of the revenue redirected to cities to help cover local costs, such as for police and zoning.

Lawmakers might also want to reshuffle some of the other spending priorities laid out in I-502, Hurst said.

It requires a two-thirds vote for lawmakers to amend an initiative in the first two years after passage. Because the upcoming legislative session is a short one, and because of the difficulty of mustering a two-thirds vote, lawmakers might not act until the following session, after pot revenue materializes, he said.

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