3 cities to get portion of marijuana tax revenue

Sales of recreational marijuana were strong across Michigan in 2020 and will result in $10 million being distributed to counties and local governments.

Under the Michigan Regulation and Taxation of Marihuana Act, which was approved by voters in November 2018 to legalize recreational marijuana, tax revenue and fees collected from the sale of recreational marijuana at licensed retailers and microbusinesses are put into the state’s Marijuana Regulation Fund and then distributed to local governments, counties, the School Aid Fund, and the Michigan Transportation Fund.

In Fiscal Year 2020, $46.7 million was collected from the 10% adult-use marijuana excise tax and other fees. Over 170 licensed establishments sold over $341 million worth of recreational marijuana in fiscal year 2020 with the first legal sales being made Dec. 1, 2019 in Ann Arbor.

“The revenue generated from marijuana taxes and fees is important to our local governments,” said State Treasurer Rachael Eubanks. “In this extraordinary time, our staff is working to get those payments to impacted municipalities and counties. Every dollar helps right now.”

In Oakland County, three communities and the county will split nearly $400,000, according to the Michigan Department of Treasury.

Oakland County will receive $196,009, Hazel Park will receive $84,003, and Walled Lake and Ferndale will each receive $56,002. Allocations are based on the number of licensed adultuse marijuana retailers and microbusinesses in each community and county.

49 of the county’s 62 cities, villages, and townships have opted out of the licensed establishments portion of the Michigan Regulation and Taxation of Marihuana Act. Only Berkley, Ferndale, Royal Oak, Orion Township, Lake Orion, Walled Lake, and Hazel Park currently allow for licensed adult-use marijuana establishments.

How is the sales tax revenue distributed?

• 15% to municipalities in which a marihuana retail store or a marihuana microbusiness is located, allocated in proportion

to the number of marihuana retail stores and marihuana microbusinesses within the municipality;

• 15% to counties in which a marihuana retail store or a marihuana microbusiness is located, allocated in proportion to the number of marihuana retail stores and marihuana microbusinesses within the county;

• 35% to the school aid fund to be used for K-12 education; and

• 35% to the Michigan transportation fund to be used for the repair and maintenance of roads and bridges.

Breakdown in payments

• 38 cities with 115 adultuse marijuana retailer/microbusiness licensees will split $3.22 million

• 7 villages with 11 adultuse marijuana retailer/microbusiness

licensees will split $308,000

• 21 townships with 52 adult-use marijuana retailer/microbusiness licensees will split $1.45 million

• 38 counties with 178 adult-use marijuana retailer/microbusiness licensees will split $4.98 million

• Total distributed to counties and CVTs: $9.96 million

“The team at the Marijuana Regulatory Agency did a tremendous job getting

the adult-use licensing program established and operating efficiently,” said Andrew Brisbo, RA executive director. “Infusing over $28,000 per retailer and microbusiness into local government budgets across the state is very impactful and shows how strong and successful the industry is becoming.”

Aside from the nearly $10 million for local governments, $11.6 million will be sent to the School Aid Fund for K-12 education and another $11.6 million

to the Michigan Transportation Fund, upon appropriation by the Legislature. The remaining $12.5 million amount will be used toward start-up and administrative costs.

A full list of local government allocations can be found at https://bit. ly/3eaTnsr