Marijuana sales tax issue coming to April's area ballots

Mar. 17—All area voters will see a marijuana sales tax issue on their ballot on April 4, and many voters will see it on their ballot twice.

The cities of Joplin, Carthage, Webb City, Carl Junction and Neosho have all put proposals on the ballot to impose a 3-cent local sales tax on the sale of recreational marijuana to adults in their city limits.

Jasper and Newton counties have similar measures on the ballot that would only apply to dispensaries built outside incorporated areas.The measures need a simple majority to pass and would be on top of a 6-cent sales tax already approved by voters as a part of the Amendment 3 to the Missouri Constitution approved by voters in November 2022.

The Carthage City Council's Budget Ways and Means Committee approved educational and informational flyers and sheets which will be distributed by the internet and social media over the next few days telling voters exactly what is on the ballots.

Carthage City Administrator Greg Dagnan said he hopes the information on these sheets will help voters avoid confusion on the measure.

"I think the big thing that people misunderstand is they think this is some new tax we created, I'm not sure they understand it's in the constitutional provision," Dagnan said after the Carthage City Council meeting on Tuesday, March 14. "I also don't think maybe they understand that it's not on medical marijuana. It's only a tax that will be paid by people who buy recreational-use marijuana. I also want people to understand that this is here anyway, it's in the state constitution. Whether they vote "yes" or "no" for this tax, marijuana is here, it doesn't matter."

The proposed tax wouldn't be charged on any other product other than recreational-use marijuana. The measure doesn't change sales taxes charged on any other products.

Proponents of recreational use marijuana say they intentionally worded the amendment to include a 6-cent sales tax to be collected by the state of Missouri and gave counties and cities the opportunity to put an additional 3-cent sales tax on the ballot.

The state already collects a 4-cent sales tax on medical marijuana sales, which was approved in 2018.

People with medical marijuana cards buying it with a prescription will continue to pay only that 4-cent sales tax and not the 9-cent sales tax that will be paid by recreational marijuana purchasers if these sales tax proposals pass.

John Payne, with Legal Missouri 2022, the group that gathered the signatures and placed Amendment 3 on the ballot in 2022, said proponents understood that getting some tax revenue from the recreational sale of marijuana was important to voters.

"Voters care a lot about the revenues that can be created off the sale of recreational marijuana," Payne said. "Now we do have one of the lower tax rates in the county on that because we also know if we set the tax rate too high that kind of perpetuates the illicit market so you have to do a balancing act there. But voters do want to bring this into a legal market and derive some decent tax revenue from it."

Payne said proponents wanted to prevent counties from stacking their 3-cent tax on top of a local city 3-cent tax, something that other counties have tried to do in other parts of Missouri despite it being prohibited in the amendment.

The Missouri Municipal League, a statewide association of city governments, has estimated that a 3-cent sales tax means a city with a single dispensary could bring in between $100,000 and $150,000 per year.

Communities affected

—Jasper County Commissioner Darieus Adams said he doesn't know of any dispensaries that might be covered if residents vote for the tax, but they wanted to put it on the ballot to be ready if any dispensaries are opened.

If passed in Jasper County, the county sales tax would only be collected on marijuana dispensaries built in unincorporated areas outside existing cities.

—Carthage City Administrator Greg Dagnan said his city has one dispensary inside its city limits.

Adam Murphy, director of Blue Sage Cannabis, located in the Peach Tree retail district in south Carthage, said he thinks the tax would be a "win-win for everyone," if voters pass it.

"I assumed they would," Murphy said in February when his business first received a license to sell recreational marijuana. "We were expecting it, and I think it's the right move. Missouri, in my opinion, has the most reasonable cannabis tax in the country. I think just (the city) putting a 3% tax on it (is) a reasonable number. It's a lot more in many states, so I think that 9% is a nice number. It's enough to really help the community and the state with that extra tax revenue, and it's also not so high it scares people off."

—Joplin City Manager Nick Edwards told the Joplin City Council in January that he knew of three dispensaries in Joplin's city limits.

"We anticipate this tax will generate anywhere between $300,000 and $500,000 annually," Edwards told the council in January when they voted to put the issue on the ballot. "Still we would probably have to see how it will go for a full year before making any big decisions on what to do with it."

—Carl Junction City Administrator Steve Lawver also said there are no dispensaries in Carl Junction, but the city is seeking the tax and adjusting its zoning, business licensing and criminal code to prepare in case a dispensary decides to build in the city limits.

There is a dispensary near Harps Grocery Store on Fir Road, but that store is in the village of Airport Drive, just outside the Carl Junction City limits. Airport Drive is not seeking the 3-cent local sales tax on recreational marijuana in this election.

—Webb City City Administrator Carl Francis likewise said there are no dispensaries in the Webb City limits, but they put the tax on the ballot to be ready.