Council to put pot tax towards debt

Marijuana from Zion Cannabis Dispensary in Ontario. (Liliana Frankel/The Enterprise)

ONTARIO – Ontario will spend its marijuana tax windfall paying city debt owed for employee retirements and one-time spending for city projects, the Ontario City Council decided on Feb. 23.

The measure was proposed by Councilor Ken Hart and passed unanimously. 

The city expects to collect about $3 million this year through the local tax on marijuana sold in Ontario. Combined with tax collections from previous years, Hart and City Manager Adam Brown estimated the city had $5.5 million to spend.

Ontario currently has almost $11 million in retirement debt. The resolution pointed out that “interest payments on this unfunded liability negatively impact the general fund resources by taking funds from operations and puts them towards (retirement fund) interest payments.”

Councilors were united in their resolve to move towards alleviating Ontario’s current debt burden. 

“Most people have a mortgage, but I’d sure love to be one of those folks who’s smart enough to get their mortgage paid off,” said Hart. 

The resolution explained that a key reason for Ontario to focus on one-time expenditures instead of ongoing city operations was that “a significant amount, far more than a majority, of the revenue comes from sales to residents in Idaho; and if marijuana sales are legalized in the state of Idaho, Ontario will lose the majority of this source of revenue.”

But Idaho state Senator Abby Lee, who is also associate vice president of Treasure Valley Community College, said that any legalization of marijuana in Idaho was likely years away. And a complete ban on marijuana is almost just as likely. The Idaho Senate last month approved a constitutional amendment prohibiting marijuana and other drugs that remain illegal at the federal level. The measure now goes to the Idaho House and if approved there, would go to Idaho voters in November 2022.

Lee said other legislation has been proposed to legalize medical marijuana. 

“I don’t see any pathway of legalizing marijuana in this or next legislature,” she said.

News tip? Contact reporter Liliana Frankel at [email protected] or 267-981-5577.


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