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Arkansas Medical Cannabis Sales Tax Funds School Lunches for Kids

The Arkansas Medical Marijuana Commission (AMMC) recently announced the benefits that the state’s medical cannabis program, with millions of dollars in cannabis tax funds helping to provide lunches for kids at school.

While the state has collected $115 million from cannabis taxes, $87 million went toward free or low-cost lunches for children. AMMC spokesperson Scott Hardin explained the breakdown. “A billion dollars has been spent to purchase medical marijuana but what that means for the state is that we’ve collected 115 million dollars in state tax revenue,” Hardin told ABC 7. “From that $115…$87 went to [University of Arkansas for Medical Sciences] specifically as they tried to obtain that National Cancer Institute designation. Now there’s a change. Now that funding is going to go specifically to food insecurity.”

The “low-cost” part of this means kids are paying very little for food. “What that’ll mean is, if someone is on a reduced school lunch, if they are now paying 50 cents to a dollar, that medical marijuana revenue steps in and pays that to ensure that a student gets that for free,” Hardin explained. “So really students in the state will be not having to pay whatever that burden is. 50 cents, a $1.50 to have reduced school lunch so it really is, it’s affecting Arkansans in a positive way.”

The state currently only has eight cultivators and 38 dispensaries, which Hardin said is plenty of storefronts to serve patients and address the current growth pattern. “Unless something changes, unless voters go back to the polls and either accept a modified program or a recreational program or something that’s really where we are,” he said. “The industry itself, you’re not going to see more dispensaries opening up all over the state. You’re not going to see more growers but what we are seeing is more patients. At the beginning of the year we had 89,000 patients. Now we are pushing 100,000.”

Current data, updated as of Dec. 9, shows that there are 98,099 patients with active medical cannabis ID cards. According to Hardin, the industry has far outpaced initial projections that the state’s mature market would only have approximately 50,000 active cardholders.

The most recent sales data for November 2023 shows that the state collected $257 million. Arkansas’ medical cannabis program launched in May 2019, and between then and October 2023, the state has collected a total of $988.3 million in sales. The combined sales per year breaks down sales from 2019 ($31.2 million), 2020 ($181.8 million), 2021 ($264.9 million), 2022 ($276.3 million), and 2023 ($234 million, but only between January 2023-October 2023).

According to a report from the Arkansas Times, the more accurate number for total sales since medical cannabis began has already surpassed $1 billion. “We’re totally confident we’ve surpassed that,” Hardin said.

According to Arkansas Cannabis Industry Association executive director, Bill Paschall, reaching that $1 billion mark is a sign that cannabis is doing a lot for patients in Arkansas. “It underscores the growing acceptance and recognition of the therapeutic benefits of cannabis and the commitment of the state’s medical cannabis licensees to providing safe, quality and innovative products that meet patients’ needs,” said Paschall. “The men and women employed by the marijuana industry look forward to continuing to positively impact the lives of Arkansans and contributing to the evolving cannabis landscape.”

Arkansas isn’t the only market hitting $1 billion for cannabis sales. A recent report shows that Arizona’s recreational cannabis market has also hit $1.1 billion in sales, but includes sales data from just 2023 (specifically, January 2023-September 2023). Arizona’s overall sales data shows a total of more than $billion since it began sales in January 2021.

In legal news, an Arkansas judge ruled in September that the 2018 Farm Bill takes legal precedence over the state’s ban on hemp-derived cannabinoid products like delta-8. Act 629 of 2023 that passed earlier this year banned delta-8, delta-9, and delta-10 THC products. The lawsuit was filed by four companies (Bio Gen LLC, Drippers Vape Shop LLC, The Cigarette Store LLC, and Sky Marketing Corp) whose lawyers alleged that the ban would harm their businesses. “Plaintiffs have been, and will be, harmed by Act 629, as they are unable to transport in and through Arkansas hemp-derived cannabinoid products that have been declared legal under federal law,” the lawsuit stated.

According to the Arkansas Times, a different ongoing case involves if restrictions on advertising for cannabis businesses is unconstitutional. The lawsuit was filed in 2022 by Good Day Farm, which argued that advertising restrictions violate its right to protected commercial speech. Circuit Judge Chip Welch heard arguments earlier this month, and plans to issue a ruling by the end of the year. Attorney General Tim Griffin already stated that he plans to appeal the decision, if Welch decides to rule in favor of advertising being too restrictive.

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