Oregon is a wacky place when it comes to public policy, and marijuana policy is no exception. For a long time medical marijuana dispensaries operated basically freely even though medical marijuana dispensaries were illegal. Then the Oregon Legislature legalized medical marijuana dispensaries, and cities and counties banned them. Then when it became apparent that Oregon might legalize marijuana for recreational purposes, local governments started passing tax measures so they would be in place if/when marijuana became legal. These measures were passed by some local governments that had previously banned medical marijuana dispensaries. All the while Oregon Measure 91 specifically gave all taxing power to the State of Oregon, and therefore any local recreational marijuana taxes would not be binding.
This was covered in a fantastic guest article by top attorney Dave Kopilak, who wrote Oregon Measure 91, and was posted on the Oregon Live website. Below is an excerpt:
Now take a look at these Rodney Dangerfield-like provisions. You don’t need to be an attorney.
“SECTION 42. State has exclusive right to tax marijuana. No county or city of this state shall impose any fee or tax, including occupation taxes, privilege taxes and inspection fees, in connection with the purchase, sale, production, processing, transportation, and delivery of marijuana items.”
“SECTION 58. Marijuana laws supersede and repeal inconsistent charters and ordinances. Sections 3 to 70 of this Act, designed to operate uniformly throughout the state, shall be paramount and superior to and shall fully replace and supersede any and all municipal charter enactments or local ordinances inconsistent with it. Such charters and ordinances hereby are repealed.”
Could the statutes be any clearer? What kind of legal analysis would cause anyone to think that a local tax might be “grandfathered in” if an ordinance was adopted before election day?
I have had debates in person, over the phone, and via e-mail with Mr. Kopilak on non-Oregon Measure 91 matters, and I can honestly say, he’s one of the smartest people I’ve ever met. But, as Dave alluded to in his guest article, it doesn’t take a legal genius like Dave Kopilak to figure out that cities, as it stands right now, don’t have any authority over recreational marijuana taxes. I think deep down, they knew that, but they figured they would give it a shot, and who knows, maybe there’s some alternative motive that local governments aren’t sharing.
Regardless of their motive for passing meaningless marijuana taxes and wasting a lot of time, local governments now plan on lobbying the Oregon Legislature to approve local marijuana taxes. Per a different article on Oregon Live:
City officials seeking to levy local taxes on legal sales of marijuana in Oregon plan to take their fight to the state Legislature next year.
The League of Oregon Cities says it will ask legislators to amend the marijuana legalization measure passed by voters two weeks ago to explicitly allow local taxes being sought by at least 70 cities, including Portland and several of its suburban neighbors.
Sponsors of Measure 91 say they will fight the local taxes, which they argue could drive up the cost of legal marijuana to the point that it could encourage pot users to continue buying on the black market.
I truly hope that the Oregon Legislature sticks to the spirit of Oregon Measure 91, a measure that was overwhelmingly passed by Oregon voters that didn’t involve additional local marijuana taxes. I’m hopeful that Oregon will become the first state to fully undercut the black market by keeping marijuana prices as low as possible. If not, the black market will always exist, although not as in large a capacity under prohibition.
