THE EFFECTS OF LEGALIZATION OF CANNABIS ON WASHINGTON AND COLORADO

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The Effects of the Legalization of cannabis in Colorado and Washington State

THE EFFECTS OF LEGALIZATION OF CANNABIS ON WASHINGTON AND COLORADO

Many have wondered what the effects of legalizing marijuana will have on existing states
in America. With the potential of legal cannabis becoming a reality in certain states, it is
important to evaluate the effect on stats such as Colorado and Washington State where marijuana
has become legal for recreational use. When analyzing the effects of marijuana, one must
consider the considerable amount of time and that goes into opening a new market. The
legalization of marijuana in Colorado and Washington has had a direct economic and criminal
effect leading to benefits in both categories. The effects of legalization have considerably
bettered the states of Colorado and Washington state through numerous avenues, such as real
estate, job markets, sales tax, and decrease in convictions.
The event of legal cannabis being sold in Colorado and Washington state occurred in the
year 2014. This was made possible by the passing of amendment 64 for Colorado and the
Washington initiative I-502 for Washington State. Both bills were officially passed in 2012 with
a 54.8% win for yes on amendment 64 and 55.7% for initiative I-502 (Pegram,2014). While
these reform bills were passed in 2012, the legal sale of cannabis in these states did not occur
until 2014. Other aspects of the legalization had to be considered within those two years to
ensure that everything was being done in the best way possible.
The economic value of legalization of marijuana is often underestimated in respect to
everything legal cannabis has an effect on, such as real-estate and job markets. The opening of
new businesses allows for prosperity of not only jobs directly, but by all involved with the
development and sale of cannabis. As a direct result of the legalization, Colorado and

THE EFFECTS OF LEGALIZATION OF CANNABIS ON WASHINGTON AND COLORADO

Washington state have seen a substantial increase in the number of jobs available. Many banks
and credit companies did not want to be associated or do business with legal cannabis stores, so
for legal reasons many dispensaries are forced to deal with cash only and as a result many
dispensaries are forced to employ advanced security companies to ensure that they can do
business safely (Pagliery, 2006). While it is unfortunate that dispensaries are still having
difficulty dealing with banks, dispensaries being forced to be a cash only business has been
beneficial to businesses outside the industry. In an interview by CNN with a medical dispensary
owner named John Davis the CEO stated The Northwest pot dispensary has reinforced concrete
walls, motion detectors, and cameras everywhere. Teller windows are made of thick, ballistic
acrylic glass. The place is built like a fortress -- which is appropriate. It's a former bank.
(Pagliery, 2006). Dispensaries building their businesses like this have security and construction
companys routine and as a result the security industries in Colorado and Washington state have
seen a substantial increase in business for security companies and construction alike. The effect
of legalization on the job market can also be seen from the statistics collected by the bureau of
labor. In January 2013 the unemployment rates in the states Colorado and Washington were at
7.1 % and 7.3 % but in April 2015 Colorado and Washington the Bureau reports an
unemployment rate of 4.2% and 5.5%(Bureau of Labor Statistics,2015).
After legalization came a new demand for other economic oppotunities such as grow
ops, store housing, and housing for those who wish to take advantage of the change in laws.
CNN drew from real estate agent Toby Waters who stated that the competition for lower level
homes has been very tight with an increase in first time buyers. This is great for the economy
because with competition for housing comes an increase in value of homes due to their being a

THE EFFECTS OF LEGALIZATION OF CANNABIS ON WASHINGTON AND COLORADO

lack of supply and a significant increase in the demand of homes. CNN interviewed another real
estate agent in Denver who stated, (Vasel, 2015) Inventory has been tight in the city. In a normal
market, Denver typically has around 24,000 listings, according to Moye. But right now, she said
there are only around 4,000. The change in availability of listings in Denver proves that
legalization has had a substantial effect of the sale of homes. With an increase in demand for
homes, there is a potential for an increase in the building of new homes to satisfy the need for
more homes. The need for homes is not likely to change also according to Moye she expects the
market to run for five to seven years. The legalization of cannabis in Colorado and Washington
has opened up now career opportunities in their states by legalizing cannabis and as a result
many people are now able to travel to these states with a job to support them.
The prosecution of cannabis consumers in America has consequently lead to many
financial downfalls across the country. Now after the legalization of cannabis in Colorado and
Washington state are now seeing a decrease in the damages from arrests for marijuana
possession. The drug policy alliance estimates that Colorado will save an estimated 12-40
million dollars in the year of 2017 through the discontinuation of punishing citizens for
possession of cannabis (Pegram,2014). The only reason these financial gains are possible is
because of Colorado's decision to legalize the possession of cannabis. In addition to saving
money on incarcerating and prosecuting cannabis consumers, by removing the punishment for
possession, cannabis users are now able to maintain a clean record which effectively benefits the
employment rates in Colorado and Washington. This in turn may provide former criminals and
opportunity to stay out of the system, become gainfully employed, and contribute to the
economy. When any type of arrest or crime goes on a persons record, it can be hard to find jobs

THE EFFECTS OF LEGALIZATION OF CANNABIS ON WASHINGTON AND COLORADO

and get into schools no matter how little the crime. This essentially pushes these people into
doing illegal things because their reputation is already tainted.
The money spent on recreational cannabis is currently benefiting the states of Colorado
and Washington through tax revenues. The taxes placed on cannabis in Colorado include a 10
percent tax on the retail of the sale of cannabis and a 15 percent tax on whole sale transactions
(Imam, 2015). The resulting revenues from these taxes add up for a grand total of 70 million
dollars in the first fiscal year alone (Imam, 2015). These large increases in State revenues are a
direct result of the legalization of cannabis and with these funds Colorado will be able to
properly fund new schools and infrastructure.
The evidence of the economic benefits in Colorado and Washington from legal cannabis
sales is becoming so strong that even naysayers of the movement are now being swayed into
seeing the benefits of the outcome. One of those naysayers was the current Governor of Colorado
John Hickenlooper who was very avid in his stance against the sale of recreational cannabis.
John Hickenlooper was so against legalization that he evens stated If it was up to me, I wouldn't
have done it, right? I opposed it from the very beginning. In matter of fact, all right, what the hell
I'll say it was reckless. (Horowitz, 2015) referring to amendment 64 passed by Colorado.
Hickenlooper in 2015 would later state that initially he believed that the cannabis reform law
should have been reformed, but as of 2015 he now believes that if given the chance to retract the
amendment 64 he would likely have second thoughts due to the benefits seen from legalization
(Horowitz, 2015). This expresses how overwhelmingly positive the legalization of cannabis has
been in the state of Colorado, especially if someone like Governor John Hickenlooper could be
swayed after viewing the resulting effects such as the economic gains.

THE EFFECTS OF LEGALIZATION OF CANNABIS ON WASHINGTON AND COLORADO

Those who oppose legalization believe that the legalization of cannabis in Colorado and
Washington has not diminished the black market sale of cannabis. The national drug control
policy alliance published an article stating that The existing black market for marijuana will not
simply disappear if the drug is legalized and taxed. (National Drug Control Policy alliance,
2015). This claim has been disproven after observing the arrests after Colorado legalized
recreational marijuana. The drug policy alliance has released a statement which reads Marijuana
Possession, Cultivation and Distribution Charges Down a Total of 80% Since 2010 (drug policy
alliance, 2015). While this statistic from the drug policy alliance does not prove that the black
market sale of cannabis in Colorado is completely dead, it does show that the black market for
cannabis is ultimately dying.
In conclusion, there are many factors to consider when analyzing the success of
marijuana legalization. These factors include crime rates, economic benefits, job creation, home
sales, and State tax benefits. The legalization of marijuana in both Colorado and Washington
State are great examples of the many benefits of legalization. The opposition of these positive
effects are commonly underestimating and once shown the true value of recreational cannabis the
claims rarely hold any ground.

THE EFFECTS OF LEGALIZATION OF CANNABIS ON WASHINGTON AND COLORADO

References
Vasel, Kathryn. "How Legal Marijuana Biz Is Boosting Denver's Housing Market". CNNMoney.
N.p., 2016. Web. 28 Mar. 2016.
Pengram, L. (2016). Six Months of Marijuana Sales: Positive Trends Emerge in Colorado. Drug
Policy Alliance. Retrieved 5 May 2016, from http://www.drugpolicy.org//six-months-marijuanasales-positive-trends-emerge-colorado
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Horowitz, Jake. "What Colorado's Governor Wants America To Know About Legalizing Weed".
Mic. N.p., 2015. Web. 7 May 2016.
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