How Cannabis tax revenue can eliminate health inequities in New York
Harnessing Cannabis Tax Revenue to Address Health Inequities in New York.
In 2023, New York’s legal cannabis industry brought in nearly $16.3 million in revenue. That number is expected to grow significantly as more dispensaries open throughout the state and the market matures.
This revenue will help support needed infrastructure, especially in towns that “opted-in” and allowed adult-use dispensaries to open. This revenue also helps accomplish one of the Marijuana Regulation & Taxation Act (MRTA)’s main goals – to bolster the state’s economy.
However, as it currently stands, this revenue has no clearly outlined plan that will support the MRTA’s other goal: reinvesting in communities most harmed by cannabis prohibition.
Most of New York’s approach has, correctly, been centered on individuals or families who were convicted of a cannabis-related crime, prioritizing people who were most harmed and giving them greater access to the dispensary application process.
But thousands more individuals and families have been harmed by cannabis prohibition than will be approved to, or even want to, open and run a legal cannabis dispensary. We must ensure we are doing more to right the wrongs carried out against Black and brown communities through cannabis prohibition.
One way this can be done is by establishing programs that specifically invest revenue from the legal cannabis industry into these neighborhoods and communities most impacted by the racism that continues to lace drug policies.
While New York loves to be a leader – we can be out front and in other cases we can learn from others. It can follow the success of, and learn from, other states that have invested cannabis revenue into specific neighborhoods.
Minnesota has pledged to invest $15 million in communities most harmed by cannabis prohibition. While that money won’t be doled out until 2026, the legal framework can be replicated in our state.
And in Evanston, IL, the city drafted a “real estate transfer tax designated for reparations.” Revenue from its two dispensaries will be distributed to individuals impacted by the “harms of slavery and institutional racism.”
Reinvesting this cannabis revenue into targeted communities will not only address the racial wealth gap, but it will directly impact the racial health gap. According to Basset and Galea, evidence suggests that reparations, or community reinvestment, should be a public health priority and can help end racial health disparities.
In New York, this could mean using cannabis revenue to develop affordable housing, an issue the state has already tied to health outcomes. Other experts have also suggested that the revenue could be reinvested into mental health services such as mobile psychiatric crisis units.
Deploying mobile psychiatric crisis units or peer navigators with lived experiences into communities harmed by cannabis prohibition represents a long-term investment into a vital area of public health that is most frequently underfunded. Or more simply, this revenue can go to increase Medicaid reimbursement rates and improve care for patients using Medicaid or contribute to much-needed funds for safety net hospitals located in Black and brown communities.
Cannabis tax revenue in New York has the potential to be a significant and very needed support stream, but to live up to the goals of the MRTA we cannot distribute this revenue evenly.
New York State must be intentional in its reinvestment strategy – used to reduce both the racial wealth gap and racial health gap. As our elected officials allocate funds from the first years of collection, this must be the priority.
