Washington Marijuana Excise Revenue: $129 million, not $1.6 billion

OK, this is confusing, so I have been tinkering with it (March 5).  The official Washington estimate of marijuana revenue at http://www.erfc.wa.gov/forecast/documents/rev20140219_color.pdf shows some $51 million through FY 2017 and some $190 million through FY 2019, but it omits the 81.7 percent of excise tax collections that do NOT go to the General Fund, and adds in general sales and B&) taxes.

But total marijuana tax collections are expected to be much bigger — $129 in excise collections alone, $28 million in other taxes.  That adds up to the current  total estimate of $157 million given to Austin Jenkins of Public Radio.

That $129 million for excises alone supersedes an old official estimate of $1.6 billion for  fiscal years through 2017.  (The new estimate goes through FY 2019, but that’s not relevant here.)

That $1.6 billon for excise alone was part of the  old  Washington estimate of $1.9 billion in total new taxes on account of marijuana for the fiscal years through 2017,  I never believed those old, high numbers.

Now for some details.  Of that new $157 million total through FY 2017, $28 million comes from sales and Business and Occupation taxes.  The $28 million figure peels off the official written estimate.  The $129 million requires subtracting that $28 million from the official $157 million figure.

Here’s how I figure that $129 million was arrived at.  I take $22.9 million from the official written estimate and adjust it,  getting only as close as $126 million — but that’s in the ballpark.

That $157 million (or $154 million, as close as I can get) compares to the old legislative estimate of $1.94 billion in goal for the period through the end of FY 2017, http://www.ofm.wa.gov/ballot/2012/I-502_Worksheet.pdf.  Quite a change.  Less than 10 percent remains.

Here are my calculations, with spreadsheet retaining formulas here:  WA revenue Feb 24 2014 PO calculations.

Among problems with my calculations are (1) numbers in the new, February estimate were rounded off, and I take them to be precise, (2) I’m using the license fee number ($483,000) from the legislative estimate that got to $1.94 billion, and the estimate is very sensitive to errors in that number.  But I’m in the ballpark.