What Price Pot?

City should get its share, but also be wary of market forces

The price of pot just went up. Since Arkansas voters approved the medical marijuana amendment back in November, the state has been struggling to form the necessary rules and regulations before growing facilities and dispensaries can get up and running.

And inevitably that means taxes and fees. Now the cities are getting into the act. On Monday, the Texarkana, Ark., City Board of Directors approved a proposal that would charge those who grow marijuana $50,000 a year for a license.

Dispensary operators would pay $7,500 for the first year and $11,250 each year for a license renewal.

The city charges are on top of fees charged by the state, which also requires a surety bond and proof of acceptable net worth. Arkansas is also charging $50 per year for a card allowing patients to purchase the drug.

It could have been worse for those who plan to build a “green” business locally. The board had considered an annual fee equal to 25 percent of inventory for each dispensary, but that idea was dropped.

Texarkana is the largest city in

Southwest Arkansas Dispensary Zone Eight, which under the law will be allowed four dispensaries.

Many expect all the dispensaries to locate here, but that’s not set in stone. Indeed, if other towns in the region adopt lower license fees, Texarkana residents with a valid prescription for pot might drive elsewhere to get what they need. Inconvenient maybe, but we doubt that would be much of a deterrence. Those who want medical marijuana will go where they have to go. The state is accepting dispensary applications until the middle of September. So, depending on what action other towns take, prospective owners may have time to shop around.

We don’t think the Arkansas-side fees are too high. The state is certainly not shy about taking its cut. Local licensing is just another cost of doing business in what is projected to be a lucrative enterprise.

We’ll have to wait and see what other cities, towns and counties come up with, and if adjustments will have to be made locally to stay competitive. No doubt a learning curve exists.

But the idea of new revenue is appealing. And a lot of folks see gold in that green goose. The question is how much can the state and cities reasonably expect to carve out before cooking the goose.