Legal weed brings tax boost, but it's modest

DENVER (AP) — To see the tax implications of legalizing marijuana in Colorado, there's no better place to start than an empty plot of land on a busy thoroughfare near downtown Denver.

It is the future home of a 60,000-square-foot public recreational center that's been in the works for years.

Construction costs started going up, leaving city officials wondering whether they'd have to scale back the project. Instead, they hit on a solution — tap $3.2 million from pot taxes to keep the pool at 10 lanes, big enough to host swim meets.

The Denver rec center underscores how marijuana taxation has played throughout Colorado and Washington. The drug is bringing in tax money, but in the mix of multibillion-dollar budgets, the drug is a small boost, not a tsunami of cash.

Much of the drug's tax production has been used to pay for all the new regulation the drug requires — from a new state agency in Colorado to oversee the industry, to additional fire and building inspectors for local governments to make sure the new pot-growing facilities don't pose a safety risk.

And estimates for pot's tax potential varied widely.

Some government economists predicted a huge boost to public coffers. Others predicted a volatile revenue stream that could spike wildly based on how consumers and the black market would respond.