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Tax Pot at Zero Percent, Just in Case

October 17th, 2014 by dk

WHEREAS, the City of Eugene is an Oregon home-rule municipal corporation having the authority (blah blah), now therefore the City of Eugene ordains as follows: A tax is hereby levied and must be paid by every seller exercising the taxable privilege of selling recreational marijuana.

Early next week, the Eugene City Council could draft an ordinance very like the paragraph above, except much longer. And it should. At the same meeting, it should also draft a resolution that suspends any such tax for at least six months.

Taken together, these actions would be understood not as an effort to raise money, but simply to retain control. Legal advisers are uncertain whether the courts will allow municipalities any control over recreational marijuana after Measure 91 passes in November, which appears likely. Two dozen Oregon cities have decided they have nothing to lose.

Look at it like this. Marcus Mariota sees that a defender jumps offsides as he hollers “hike.” A penalty flag is dropped but there’s no whistle stopping the play. He knows the play can be called back if the Ducks don’t like the outcome, or they can decline the penalty if they do. He can throw a risky pass, hoping for a high-stakes gain.

It’s considered a “free play” because there’s no risk involved.

Measure 91 forbids local taxes, but only those imposed after the item is legalized. The flag has been thrown but the whistle won’t blow until November 4.

Springfield looks likely to adopt a pot tax and Lane County has scheduled a hearing for next Tuesday. Charging a nickel for grocery bags seemed silly to them, but they may double down with a tax on dime-bags.

Eugene Mayor Kitty Piercy was invited this week to a conference focused on entrepreneurial cities. She will return in time for Monday’s public hearing and the city council’s subsequent work session. Marijuana and entrepreneurship have been joined only in hushed conversations, but that’s changing.

Marijuana is shifting from crime to medicine to recreation. Coloradans are already seeing what comes after that: tourism. Now think about that. Where in America will more people want to visit if “get legally high” is on their bucket list?

Sure, tourists can pick where they’d most like to get their legal buzz. They can go to Colorado and ski. They can visit Seattle’s Fremont bridge troll. They may soon imagine themselves in an episode of “Portlandia.” They may even be able to attempt a CSPAN photobomb. (Initiative 71 would legalize marijuana in Washington, DC, where passage also looks likely.)

Can any of those places compete with Eugene, where the ‘60s never reached 70, the underground never went under, and psychedelia never grayed — even if its adherents did?

Tourism taxes can bring money into the local economy without burdening residents. Ashland imposed a restaurant tax in 1990 so visiting Californians could pay for more neighborhood parks. Politicians love tourism taxes because tourists can’t vote them out of office.

We may find ourselves on the forefront of an entire industry that has not yet emerged. If Eugene sees an economic windfall coming, how will we spend the money? On treatment programs, education opportunities, a tax-free marijuana dispensary for residents?

On that, I have no opinion. The proposed accompanying resolution would give City Council time to evaluate the situation. They may later rescind the ordinance altogether, or it may be invalidated by the courts. Or extending the tax suspension for longer may look smart.

A little bit of preparation might give Eugene much more control.

My mother always insisted I carry a jacket when I was leaving the house for more than an hour or two. Her rule was simple, self-evident, and oft-repeated: “If you’ve got it, you can always take it off. But if you don’t have it, you can’t put it on.”

I remember her advice mostly from the times I didn’t take it. North winds can come quickly in Chicago. Legal and political winds of change are on the horizon for marijuana. No one knows what might come next. A little layer of protection — just in case — couldn’t hurt.


Don Kahle ( writes a column each Friday for The Register-Guard and blogs.

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