32 Aug 8th-Aug 14th, 2024 phoenixnewtimes.com PHOENIX NEW TIMES | NEWS | FEATURE | FOOD & DRINK | ARTS & CULTURE | MUSIC | CONCERTS | CANNABIS | Up in Smoke Medical marijuana sales continue to fall in Arizona. BY DAVID ABBOTT | ARIZONA MIRROR A fter a slight uptick in March, the medical mari- juana market continued its slow-moving free-fall and has dropped to one-quarter of the size of the adult-use market three years after recreational sales began. Following a third straight year of reaching $1.4 billion in total sales, Arizona’s cannabis markets have fallen into a familiar pattern, leveling out at about $110 million monthly. From March 2021, when the combined marijuana market reached nearly $134 million in monthly sales, totals have ranged from about $120 million to an apex of $140 million in March 2022. So far in 2024, those numbers have been below $113 million. January and April bottomed out at $104 million, the lowest total since the first full month of legal cannabis sales in February 2021 registered $96 million. Since a record $103 million of sales in March 2023, adult-use sales have remained steady, fluctuating between $70 million and $90 million monthly, following a trend that began in December 2021. The most recent report for the month of April was $83.7 million. March had the highest total recreational sales so far in 2024, reaching $89.5 million. After the medical side recorded consec- utive lows in December 2023 and January 2024 at $25.4 million and $21.5 million, respectively, the bottom keeps dropping for a program that has been in existence for more than a decade. After reaching a peak of $73.4 million in April 2021, the medical market has not topped $40 million since July 2022. In recent months, it has barely cracked $20 million. April’s $20.6 million is the lowest total reported since recreational sales began. Tax implications The state collects a 16% excise tax on recreational sales in addition to the standard sales tax; medical patients pay roughly 6% in state sales tax. Local juris- dictions charge an additional 2% or so for all marijuana sales. From February through April, the medical program has contributed about $5.5 million to the state coffers. Taxes on recreational sales have been about $41.8 million over that time frame. Since January 2021, recreational sales have generated about $500 million in excise taxes. One-third of revenue raised by the excise tax is dedicated to community college and provisional community college districts; 31% to public safety, including police, fire departments, fire districts and first responders; 25% to the Arizona Highway User Revenue Fund; and 10% to the justice reinvestment fund, which is dedicated to providing public health services, counseling, job training and other social services for communities that have been adversely affected and disproportion- ately impacted by marijuana arrests and criminalization. The Arizona Department of Health Services has reported a steady decline in medical cannabis program participation, as the number of qualifying patients continues to drop every month. The total number of patients has plum- meted from 113,694 in January to 100,753 in May. Should the trend continue, June patient totals could be less than 100,000 — with no end in sight. In May, Arizona medical cannabis consumers purchased 4,764 pounds of marijuana in various forms, down from 4,808 reported in January. There was a slight upward tick in March to 5,076 lbs when total medical sales topped out at $23.6 million, the high point for 2024 so far. This story was first published by Arizona Mirror, which is part of States Newsroom, a network of news bureaus supported by grants and a coalition of donors as a 501c(3) public charity. The number of medical marijuana patients in Arizona is likely to drop below 100,000 people. (Photo by O’Hara Shipe) | CANNABIS |
