In November, Florida voters will head to the polls to cast their ballots either in favor or opposed to a state constitutional amendment aimed at legalizing medical marijuana. Because this is a constitutional amendment, and not a ballot initiative, the measure requires 60 percent of the vote to pass. With an estimated 88 percent of Florida voters in favor of the measure, it is expected to pass with relative ease.
With many expecting the measure to pass, the question on everyone’s mind isn’t if or even when Florida will receive medical marijuana, but rather, how much revenue will it generate? To answer that question, officials from the state have released a report estimating the potential economic impact.
According the report, the state estimates that medical marijuana in Florida could generate somewhere between $138 million and $5.6 billion in sales revenue. The report also estimates that medical marijuana could net the state of Florida an estimated $8.3 million to $338 million in tax revenue. The estimated cost of regulating trade in Florida is projected to cost a measly $1.1 million for the first two years.
In order to come to that estimate, Florida state officials first had to get relevant data to make the projection. According to News-Press, state officials first produced an estimate of potential patients. They looked at the number of patients who currently have a condition that would be covered under the measure, then they estimated the potential increase of patients with covered illnesses, and from those two figures extrapolated that Florida will potentially have 417,000 medical marijuana patients.
Once state officials came to the 417,000 figure, they looked at the average amount of money spent per year on medical marijuana per patient in other states and multiplied it by the estimated number of patients. In order to calculate the state tax revenue, officials multiplied the estimated revenue from medical marijuana sales by the six percent tax that will be levied on it.
Other independent estimates have placed Florida’s projected medical marijuana revenue more or less within the same range as the state issued report. Taylor West, deputy director of the National Cannabis Industry Association, spoke to the Florida Times Union about the NCIA’s projections for Florida.
“Based on what we’ve seen in other states and adjusted for Florida’s population, we project that a medical industry regulated in a similar way to Colorado [before all adult use was legalized] could do $600 million in sales in a year,” West explained.
It has been said that legalizing medical marijuana in Florida would bring an economic boom to the state, but for the first time we are actually seeing numbers to back up that projection. Even with conservative estimates of yearly revenue reaching close to $1 billion dollars, it is safe to say Florida is on its way to becoming the next hot spot for legal marijuana investments.
The Florida market is just beginning to open up, whereas markets in states like California stand to shrink over time and states like Colorado have become crowded. While Florida’s amendment hasn’t passed yet, now is definitely the time to start getting your investment ducks in a row in preparation for the inevitable green rush that’s coming to the Sunshine State.