In 2012, both states passed laws with clear majorities in favor of recreational (not just medical) marijuana use and dispensaries.
Colorado was the first state to create a system for growing, processing, selling, and possessing the drug. The state of Washington followed a few years later with its own version of recreational marijuana laws.
While Colorado has a booming recreational marijuana industry and great tax revenue, they are also dealing with lingering legal and health problems related to cannabis use.
Colorado and Legal Recreational Marijuana: Financial Benefits With Legal Questions
Legalized recreational cannabis in Colorado has been very successful from a financial standpoint. Since the state quickly allowed dispensaries to open, people from all over the U.S. visited the state as tourists, specifically to indulge in this otherwise illegal substance.
After Colorado’s apparent success, many other states have moved to legalize recreational cannabis. Now, 11 states have passed laws allowing residents who are 21 and older to possess a certain amount from legal dispensaries. These dispensaries must meet strict criteria outlined by the state.
Even with financial success and controls on who can access the drug, recreational marijuana use in Colorado has its share of problems.
The Success of Colorado’s Recreational Marijuana Industry
When Colorado allowed dispensaries to open to sell recreational cannabis in 2013, tourism jumped in the state. A survey found that 25 percent of people who visited Colorado between 2013 and 2018 reported that they specifically sought out recreational marijuana.
Residents of the state also take advantage of the new laws. Total tax revenue from recreational cannabis in Colorado accounts for about 3 percent of the Rocky Mountain state’s $30 billion budget. This means that revenue from selling the drug has surpassed $1 billion.
Both the medical and recreational industries have generated over $1.5 billion since they opened. Recreational sales contributed 78 percent of that revenue.
In Colorado, each person 21 years old and up has spent an average of $280 on cannabis per year. Revenue from the industry goes toward the following programs:
- Literacy programs
- Health care
- Drug abuse prevention programs
- Judicial affairs
Because of legalized recreational marijuana, there are also several new businesses (large and small) opening across Colorado and employing thousands.
Businesses in the recreational cannabis industry have made more than $6.5 billion in sales in the past five years. April and May 2019 have been the highest grossing months for cannabis in Colorado so far, even though many other states have legalized recreational use of the drug. As of June 2019, there are 2,917 licensed marijuana businesses, with 41,076 people employed by the industry.
Part of the state’s success has been the numerous associated businesses that use recreational marijuana as a focal point.
Industries that have opened in Colorado, which other states have not yet taken advantage of, include the following:
- Cannabis wellness retreats
- Cooking classes involving marijuana
- Private smoking lounges
- Paraphernalia shops selling pens, pipes, and other marijuana-related devices
- Marijuana cafes
- Dispensaries with tastings
Venues like hotels, restaurants, and nightclubs can apply for permits to allow recreational cannabis use on the premises. This looks similar to an alcohol serving license for these venues.
Another bill that has been introduced in the state will allow for delivery of medical marijuana to homes in 2020. It will create a home delivery service for recreational marijuana in 2021.
A further bill allows out-of-state investors to spend money on starting businesses. This includes publicly traded companies, so cannabis business owners can find investors and get loans more easily.
Racial Disparities and Societal Effects
One major concern with legalizing recreational marijuana across the U.S. has been the harmful impact of previous decades’ criminalization of the drug, particularly on people of color and low-income individuals.
African Americans in particular have been incarcerated at twice the rate, at least, as white people for possession or sale of the drug.
Many laws in other states are making expungement of marijuana incarceration part of their new recreational drug laws. In Colorado, arrests of African Americans in particular have gone down since recreational cannabis laws were passed. There have also been fewer court filings associated with marijuana overall.
Traffic citations for driving under the influence (DUI) have increased 3 percent since the drug laws changed — from 5,705 citations in 2014 to 4,849 in 2017. Although blood tests to detect marijuana are notoriously tricky, a 2016 survey found that 73 percent of drug tests during DUI arrests returned positive for cannabinoids.
Fatal traffic accidents associated with cannabis rose 153 percent — from 55 in 2013 to 139 in 2017. However, fatal traffic accidents involving a THC-positive driver decreased 5 percent.
Hospitalizations involving marijuana intoxication rose, although it is hard to know if this is associated with laws specifically or has to do with marijuana’s increasing popularity around the country in general. In 2000, there were 575 cannabis-related hospitalizations, which rose to 3,517 in 2016.
Calls to poison control also increased, along with emergency room visits. The number of adults who use this drug regularly — at least once per month — has gone up 2 percent. Almost twice as many men use cannabis regularly compared to women.
Among adolescents, there has been no reported increase in cannabis use among middle and high school students.
Lingering Problems With Recreational Marijuana in Colorado
Although Colorado has success stories with the recreational cannabis industry, not every aspect of legalization has been a success.
In the first year after legalization, only 30 stores opened across the state. While residents and tourists alike flooded these stores to show their support, prices and limited quantities at those stores encouraged the black market for marijuana to thrive in the state. By the end of the first year, there were over 300 stores across the state, so prices for the drug dropped significantly, allowing a lower barrier of entry while sales went up.
Other problems exist within the state, which have been associated with the legalization of marijuana. Substance abuse is a serious concern, as it is for substances like alcohol or tobacco, which have been legal for much of U.S. history. While some of the tax revenue is going to improving substance abuse programs, these have focused on education and not the addiction treatment industry.
In the early days of Colorado’s medical marijuana industry, Amendment 20 allowed medical marijuana patients to grow their own plants for personal use. Lawmakers in the state believe there is still a thriving underground market for this drug despite state legalization of recreational use. Some home growers exploit loopholes in the system about “giving” to friends or simply operate under the nose of law enforcement.
There has also been a growing problem with drug dealers smuggling Colorado-grown marijuana across state lines. This practice is a federal crime. The drug is smuggled into other states that do not allow recreational cannabis. Neighboring states have complained, so Colorado says they will work to prevent this type of smuggling.
Preventing and Treating Substance Abuse Are Important in Colorado’s Long-Term Success
While Colorado has been very successful as the first state to fully legalize marijuana and regulate businesses, researchers have noted that their market is beginning to level off. This is partially because other states in the U.S. and the entire nation of Canada have legalized recreational marijuana, so Colorado has competition. Due to this more widespread recreational legalization, drug tourism to Colorado has declined somewhat.
Some policymakers are emphasizing that it is possible to decriminalize or legalize marijuana without commercializing — and thus promoting through marketing — the drug. It is also possible for states to take full control over the growing, production, and sales process with recreational marijuana, which would help manage any problems with the black market.
As with other drugs, marijuana is addictive. Many people struggle with marijuana use disorder, evidenced by compulsive marijuana use. As with any substance use disorder, marijuana addiction can be debilitating, damaging virtually every area of a person’s life.
Addiction is a disease. A person can’t simply decide to stop using marijuana once they are addicted to the drug. Comprehensive treatment is needed to allow for full recovery and cessation of use.
Whether marijuana is legal or not, it is important to have access to evidence-based detox and rehabilitation. This ensures that those who struggle with marijuana abuse have the help they need to recover.
Colorado Grows Annual Cannabis Sales to $1 Billion as Other States Struggle to Gain a Market Foothold. (July 2019). CNBC.
How Legalized Cannabis Changed Colorado in the Past Five Years. (January 2019). Yahoo! Finance.
Seven Years After Legalization, Colorado Battles an Illegal Marijuana Market. (August 2019). KUNC.
How Colorado’s Marijuana Legalization Strengthened the Drug’s Black Market. (July 2019). PBS Newshour.