Nearly a year and a half after St. Joseph voters approved a 3% tax on recreational marijuana sales, data is shedding light on how much the tax is generating for the city. As of September 2024, St.
Joseph had received nine months of marijuana sales tax revenue totaling $678,630.61, according to city Finance Director Dawn Lanning. The $678,630.
61 was captured from sales beginning in October and November of 2023 — when the tax officially went into effect — through July of this year. This table shows recreational marijuana sales tax amounts on a month-to-month basis beginning in October 2023, when the tax went into effect. A gap exists between when the actual sales occurs and when the city receives tax revenue from the Missouri Department of Revenue.
A notable gap exists between when the sale occurs and when the city actually receives taxes on it from the state. "Businesses will actually collect the tax in October, November (for example) Missouri's Department of Revenue will receive it in December and then the city saw the first marijuana tax revenues actually in January of 2024," Lanning said. St.
Joseph's tax on recreational marijuana was voted into law in April 2023 when just over 84% of voters in the election — roughly 4,620 people — approved the proposition. Buchanan County voters approved an additional 3% marijuana tax in November 2024. Marijuana tax revenue is directed to a restricted fund that is separate but still contributes to the city's general fund.
The city initially projected it would receive around $480,000 through the end of fiscal year 2024 and $800,000 in total for fiscal year 2025. With a clearer but still limited outlook for marijuana tax projections and data, the city is likely to use revenue in the early going for larger one-time expenses or debt as opposed to committing it to an ongoing operational expense that could be impacted by changes in marijuana taxes collected. " .
.. Something that has some interest tied to it.
So then that would just free up additional funding in the next budget year," Lanning said. "So we decided to go ahead and collect the marijuana tax through the current fiscal year and then assess if we did meet our projections — not knowing really what to expect." One of the first uses could be for the Eight and Felix streets parking garage in Downtown, St.
Joseph. The proposed budget for fiscal year 2025, which runs from July 1 to June 30, proposes to use $704,437 in marijuana tax revenue to pay off remaining debt owed on the structure. "We're always trying to take a conservative approach when we're dealing with tax dollars, especially something that is as volatile as marijuana tax," Lanning said.
Over the last three months, monthly tax revenue has shown signs of stabilizing after the city saw large month-to-month swings early in the year, a byproduct of several factors including businesses adjusting to compliance with a new tax and other events. The city collected nearly $96,000 in recreational marijuana sales tax in December 2023 followed by a significant drop down to $25,860 in January 2024, before rising to $84,313 in February. The month of April, which includes the popular marijuana celebration 4/20, saw the biggest monthly collection for the city with $105,984.
39 in revenue. "We did see a little bit of a influx around business license renewal time, and that does require compliance with our taxes to be paid," Lanning said. "So that's not unusual for us to see maybe a little bit of an increase.
" St. Joseph has three certified marijuana dispensaries: Fresh Karma Dispensaries, Vertical Dispensary and Sunny Daze Dispensary. The passage of St.
Joseph's tax came not long after Missouri became the 21st state to legalize recreational marijuana in November 2022, when 53.1% of voters approved the constitutional amendment. Along with city and county marijuana taxes, the state also applies a 6% sales tax on recreational marijuana.
Passage of the law has had a significant impact on marijuana tax revenue at the state level, which increased 355.5% from $14.79 million in 2022 all the way to $67.
36 million in 2023..
