ECONOMIC IMPACT OF MEDICAL MARIJUANA REPEAL DEBATED

HELENA -- Two dramatically different pictures emerged Tuesday about
the financial impact of repealing the state law legalizing medical
marijuana.

House Speaker Mike Milburn, R-Cascade, told the House Appropriations
Committee that a cost estimate from the governor's budget office shows
if his bill repealing the law passes, it would cost the state nearly
$263,000 in fiscal 2012 but save the state about $317,000 in 2013,
$479,000 in 2014 and $496,500 in 2015.

The Appropriations Committee is examining House Bill 161 before a
final vote on the bill by the full House, which already had a 63-37
preliminary vote last week to pass the measure.

As estimated by the budget office, the additional costs the first year
are because of the cost of estimated increases in incarcerations of
people using what would then be an illegal drug. The net savings in
the three future years would be from reducing state employees and the
cost of running the registration for medical pot.

But Milburn said the estimate fails to take into account the societal
costs Montana will face if the law isn't repealed.

Tracy Raunig of Great Falls agreed, saying it would save
money.

"I think it's a great opportunity for us to not hit the wall as a
state of Montana," she said.

But a number of people involved in the medical marijuana industry
argued Tuesday that the fiscal note doesn't show the ultimate costs to
the state of Montana if the law is repealed.

These include the loss of tax revenues, loss of money paid to
utilities, hardware supply stores and other businesses and the
addition of laid-off employees to the state unemployment rolls, they
said.

Some patients said they would be forced to go back on Medicaid and be
prescribed costly prescription drugs that they don't believe work as
well as medical marijuana.

Chris Williams, owner of Montana Cannabis, said if the repeal is
passed, his staff of 30 would be unemployed. If that happens, he said
he wouldn't be spending $415,000 on payroll, $140,000 on the costs of
goods and services, $81,000 in rent, $125,000 in utilities, phone and
data services and $72,000 in federal and state taxes.

"You would do a serious impact to the state if you made this illegal,"
Williams said.

Valerie Sigler, who has medical marijuana businesses in Bozeman, Big
Sky and Butte, said she paid $183,000 in wages and workers'
compensation on 12 employees last year, $79,000 in rent, $17,000 in
utilities, $3,500 for carbon dioxide, $10,000 for phones and Internet
and $7,500 to the state Department of Public Health and Human Services.

"I ask you not to put us out of work," she said.

Jim Gingery, executive director of the Montana Medical Growers
Association, said his group did a limited economic impact study that
failed to cover the entire industry. He suggested the state ought to
do a full study to see how unemployment would rise and tax revenues
would decline if the repeal passes.

The limited study showed that medical marijuana had created 1,400 new
jobs, with 70 percent of the employees coming from the ranks of the
previously unemployed.

"This is a job-killing bill," said Ed Doctor of Whitefish.

The House Appropriations Committee is expected to vote on the bill
later this week. It faces one final House vote before heading to the
Senate.