Springfield unable to spend marijuana money because of state law

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SPRINGFIELD, Ill. (WCIA) — Springfield’s only two dispensaries are owned by the same company — Ascend. Which means Ascend is the only company paying the city’s 3 percent sales tax on pot.

That leaves city budget director Bill McCarty in a bind.

“I can’t make the allocation in the upcoming budget, because to do so would say we’ve got this much money this much tax, which somebody would then say, okay, that means their sales is X, because taxes were Y, therefore would technically be a violation.”

State law forbids public officials from giving out the amount of money one company paid in sales tax. The three percent tax is a sales tax, so it falls under that law, and since only one company is paying that tax in Springfield, McCarty says he can’t give the total brought in without revealing Ascend’s sales totals.

McCarty can’t even speak in generalities when asked how much money the city has brought in.

“The most specific terms that i could give you? More than $0.”

Marijuana sales numbers in the state climbed month after month since July.

The city can’t even spend the money in the way the city wants to without breaking the state law. Half of that money is supposed to go to police and fire pensions, the other half, to economic development on the city’s east side.

Alderwoman Doris Turner led the charge for the tax. Even she can’t be told how much money the city has brought in, but she plans to make sure that money is spent on what it’s supposed to.

“I feel like it’s my responsibility not just to rely on, you know, what Director McCarty is saying to me,” Turner said. “I am also going to be looking to, you know, my legislative representatives and those within the governor’s office to see how we can address this.”

Turner said she has not finalized a plan for how that money will be spent on the east side of the city. She plans to use the money for a big project that will end up needing more money than has been collected in just six months.

“We’ve only been collecting that money for three months,” Turner said. “So I don’t believe that it would be a significant amount that would have the significant impact that I’m looking to have. So I think that we have time, and we can always pass a supplemental budget, once we get it, you know, once we get it fixed.”

The city would have to pull some financial magic to spend that money without actually breaking the law, but to do that McCarty would sacrifice transparency, and the ability to assure the public that the money is going where it’s supposed to go.

“I could go and say, to the council, I budgeted the money that’s in there, and we can spend it. But you’re never going to know that we’re spending it’s dollar for dollar,” McCarty said.

Instead, the city will not include that money from the pot sales tax into their next budget, unless a fix comes soon from the state. That would need to come in the form of a change to the state law to adapt to the unique state of the marijuana market, where many cities only have only one operating a dispensary.

The fix could come at a local level, as well, if Ascend gives the city permission to share their tax contributions. McCarty asked Mayor Jim Langfelder to ask Ascend for that permission, but the mayor’s office told WCIA the mayor has not asked for that permission.

“We know exactly how much has come in. We are not allocating any of those funds to anything in this upcoming budget. In fact, the revenue is not even going to be included in this upcoming budget.”

if the issue is figured out, the city could file a supplemental budget that includes the marijuana sales tax money. That would allow the city to spend the money before the next budget is passed in March 2022.

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