How legal marijuana provides a positive boost to local economies

Marijuana in a few short years has proven to be the answer to many human problems. Another meaningful benefit the cannabis plant provides is an investment opportunity in community economic growth.

How Pot Investing Helps Society

Since the banking industry has avoided funding cannabis companies, independent investors have stepped up to fill the void. Hall of Fame Quarterback Joe Montana, who won four Super Bowl rings, is now showing his leadership as a cannabis investor. He’s now part of a $75 million investment pool supporting a San Jose-based cannabis manufacturer. Montana stated he believes the company can help victims of opioid addiction.

Beyond cannabis companies listed on the stock market, which has helped provide funding, there are many new cannabis startups that seek funding. Part of the proceeds go to state taxes, which have amounted to billions for states such as California, Colorado and Washington. Reuters reported in May 2018 that the U.S. cannabis market is expected to reach $16 billion by 2020. That will be the year the commercial radio industry celebrates its 100th year, as it still rakes in about $18 billion per year by comparison.

Keeping the Money Local

As much as cannabis has helped states collect revenue that otherwise would not exist, it can have an even more profound effect on local economies. One of the immediate effects legalization had in Denver was a return to a booming housing market. Colorado voters approved Amendment 64 in 2012, making it one of the first states to legalize recreational marijuana, which went on sale January 1, 2014. But since then only about a quarter of the state’s jurisdictions have allowed medical or recreational pot stores.

Even with only a fraction of Colorado jurisdictions on board to sell pot, the state sold $1.5 billion worth of the herb in 2017. It also added 3,000 new businesses to the state. Denver’s economy particularly improved as competition began to grow among growers and sellers for industrial warehouse space. Real Estate firm CRBE reported that cannabis businesses occupied over 14 million square feet in Denver alone by the end of 2016. The nearby county of Boulder, which has a population of about 322,000, collected over $1 million in tax revenue in 2017 from both medical and recreational pot sales.

The expansion of the cannabis industry has also led to job creation. In 2018 the Marijuana Policy Group estimated that 38,000 cannabis licenses have been issued in the emerging industry, which included 1,637 business owners. Furthermore, the firm estimated that the cannabis industry reached an employment level surpassing 17,000 nationally, which was a 17.7 percent increase from the previous year.

A Fast Growing Industry

The good news about marijuana for investors is that it’s one of the fastest growing industries in America. Not only can it help states and counties overcome financial hurdles, cannabis creates local businesses and jobs. These people in turn put money back into their local economies.

So far we’ve only seen a snapshot of how robust cannabis sales can be. As laws become more refined and governments see the value of cannabis, as well as industrial hemp, cannabis is poised to create a mountain of wealth for local businesses. Contact us here to learn more about the exciting economic opportunities for legal marijuana.