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California After-School Programs Still Waiting on Marijuana Taxes

California After-School Programs Still Waiting on Marijuana Taxes
PHOTO Lucélia Ribeiro

Economics

California After-School Programs Still Waiting on Marijuana Taxes

Legal cannabis was set to fund youth education, but that hasn’t happened yet.

When cannabis advocates in California began selling the idea of establishing a taxed and regulated pot market for adults 21 and older, one of the critical points in the plan (Proposition 64) was throwing a chunk of the tax revenue at the hundreds of thousands of low-income children involved with after school programs.

It wasn’t just that these programs were supposed to receive money down the line after everyone else got paid. The language on the ballot specifically showed that the state’s publicly funded After School Education and Safety (ASES) programs would be one of the first to see revenue. However, after 19 months of full-swing cannabis sales, these after-school programs have not seen a dime, according to a report from the Enterprise-Record.

Legal marijuana was intended to be part of the solution in helping these struggling programs stay afloat. Although ASES programs receive a fixed amount of annual public funding, which is determined only by the number of students enrolled, the costs to keep them up and running continue to increase. This is creating a situation where these programs are always searching for ways to cut cost. Most are flat broke, and others are in the hole. LA’s BEST Afterschool Enrichment Program, which looks after 25,000 kids, is now in debt to the tune of $1 million, the report shows.

So it is perfectly understandable why programs like this one are still waiting for the cannabis tax money to come through with the assist. If they don’t get it soon, some of them might have to shut down.

Part of the problem is California’s recreational marijuana market just isn’t working out like they initially hoped. The black market reportedly continues to dominate and, because of that, the state hasn’t generated as much cannabis tax revenue as predicted. And while California authorities have seized $30 million worth of illegal cannabis products since the launch of the state’s recreational pot market in 2018, this is just a drop in the bucket and in no way a sign that the black market is going down.

State officials estimate there are still thousands of illegal cannabis operations around the state. This means California has a long way to go before it reaps the $1 billion in new cannabis taxes that was forecast ahead of the 2016 election. Still, California did rake in around $345 million in marijuana tax revenue last year. So, why is it that these after school programs have yet to receive their cut?

Interestingly, it is the language of the law that is to blame.

Voters said “yes” to a ballot initiative allotting 60% of the annual marijuana taxes to “youth education, prevention, early intervention and treatment.” But after school programs were never specifically mentioned in the initiative. Therefore, the state isn’t at risk of legal action if it doesn’t pay.

Gov. Gavin Newsom, a massive supporter of Proposition 64 during the campaign phase, came out a few months ago with a plan to help remedy the situation.

He issued a revised budget in May allotting after-school programs more than $80 million in cannabis taxes starting with this fiscal year and more than $130 million each year moving forward. But rather than distributing these funds to the ASES programs directly, the money is to come in the form of childcare vouchers for the thousands of families that need them. Newsom said this method would provide more flexibility and benefit those people with non-traditional work schedules.

“In our view, this represents a balanced investment in multiple programs that allows the state to maintain ASES access and increase access to other childcare programs,” said H.D. Palmer, spokesman for the state’s budget office.

Meanwhile, lawmakers are working to force California to adhere to its original mission for pot taxes.

Assembly Member Kevin McCarty is pushing a piece of legislation (AB 1085) that would ensure high-quality after school programs are prioritized when it comes to the distribution of the state’s cannabis taxes.

“When voters passed Prop 64, they were promised that generated revenues would go to support after school programs. These programs prevent and reduce substance use for students and help to improve school retention and academic performance,” the proposal reads.

If the issue isn’t remedied soon, ASES programs may find themselves in the position of having to charge parents to cover the difference. But because many of these families are walking the poverty line, that’s not exactly the best solution. Many argue that Newsom’s support is needed to clarify the law. “Our sincere hope is that he honors the will of the voters and the intent of this initiative,” Jennifer Peck, president of the Partnership for Children & Youth, told the news source.

TELL US, are you surprised after-school programs have yet to receive California’s cannabis taxes?

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