Marijuana Legalization Could Increase NYC Revenue by $25M

New York local officials discuss tax implications of marijuana legalization. (Photo credit: Justin Sullivan/Getty Images)

New York local officials discuss tax implications of marijuana legalization. (Photo credit: Justin Sullivan/Getty Images)

Doug Turetsky, chief of staff and communications director for the New York City Independent Budget Office, discussed the projected implications of marijuana legalization in New York on Wednesday, revealing the latest calculations for potential revenue from cannabis.

In his testimony to the Public Forum held by Senator Liz Krueger and Assembly Member Peoples-Strokes, Mr. Turetsky weighed up the pros and cons of marijuana legalization in the latest Budget Options for New York City report–a first in the Budget Office’s history–and delivered numbers notably different from the figures published last year by the New York Comptroller’s Office, which estimated returns of $431 million annually if marijuana were legalized. In contrast, the Budget Office approximated a $25 million increase in tax revenue.

To be fair, Mr. Turetsky conceded, the Comptroller looked at potential savings on police expenses as well as tax returns. When over 350,000 NYC residents have been detained for possessing small amounts of cannabis over the past 10 years, the toll on government resources has proved substantial. Meanwhile, the Budget Office took other contextual factors into account. For example, its calculations not only look at the currently reported statistics on New Yorkers using marijuana illegally, but also the aftermath of cigarette legalization in the recent past, when smokers still bought cigarettes on the black market to avoid heavy taxation. The Budget Options report also accounted for trends in medical and recreational use of marijuana in Colorado, a real world example that could help predict behavior.

Revenue aside, Mr. Turetsky concluded his speech by invoking the impact of legalization on the populace. “There is a human toll involved with current policies,” he said. “Blacks and Latinos are arrested at far greater rates than whites. Such factors may be equally or even more important than any calculations of the fiscal effects of legalizing marijuana.”