A new study has revealed that adult-use cannabis legalization could give Arkansas’ economy a major boost as voters prepare to make their voices heard on a legalization measure that will appear on the state’s November ballot.
The study, prepared by the Arkansas Economic Development Institute for Responsible Growth Arkansas, the group behind the ballot measure, projects annual adult-use sales averaging as high as $681.7 million.
Total cannabis sales in the state, including medical sales, could reach $984 million by 2027, according to the report, with state and local tax revenue increasing by $460 million within the same timeframe.
“That includes both the indirect effects that are based on the business buying from suppliers, paying employees … and then the induced effects where the employees who are now earning income spend money in the rest of the markets,” Michael Pakko, the chief economist for the Arkansas Economic Development Institute, said during a Sept. 28 news conference, according to a KUAR report. “So, it has a ripple effect throughout the economy.”
Responsible Growth Arkansas’ proposed constitutional amendment will appear on the state’s November ballot after the state Supreme Court ruled last week that the ballot measure’s title is not misleading to voters.
The group submitted 190,000-plus signatures July 8—more than double the required 89,151 valid signatures necessary to qualify its measure for the ballot. Secretary of State John Thurston’s office certified the signatures for the ballot July 29, but the state Board of Election Commissioners rejected the measure Aug. 3, determining that it was misleading in its title.
Responsible Growth Arkansas clapped back with a lawsuit that ultimately landed in the state Supreme Court.
Now headed to the ballot after the Supreme Court’s Sept. 22 ruling, the measure would legalize cannabis for adults 21 and older; create a licensed program for commercial cultivation and retail; authorize the Alcoholic Beverage Control (ABC) Division to oversee the industry; and establish a 10% “supplemental sales” tax with 70% of the revenue generated allocated to the state’s general fund.
“Assuming that the adult cannabis use amendment passes, we would see more than a doubling of total demand by 2023 even though… it wouldn’t take effect until March of 2023, but then rise rapidly close to a $1 billion industry by the end of our study period in 2027,” Pakko said at Wednesday’s news conference, as reported by KUAR.
The Arkansas Economic Development Institute study estimates that adult-use cannabis legalization will boost the state’s gross domestic product by $2.36 billion over the next five years, as well as create as many as 6,400 new jobs. The study also projects that Arkansas could see $210 million in new general revenue funds, with tax revenue contributing more than $45 million to law enforcement and $30 million to cancer research at the University of Arkansas for Medical Sciences.