Author: Juliet Sobel
Abstract
This post proposes that Congress adopt a system of compulsory voting to address the problem of voting discrimination. Such a system would have considerable advantages over the Voting Rights Act (particularly after Shelby County and Brnovich) and over other recently proposed legislation because it would address both governmental impairment of the right to vote and also the significant socioeconomic factors correlated with low voter turnout. Congress should have the power to enact such a plan through its Fifteenth, Nineteenth, and Twenty-Sixth Amendment powers. First Amendment concerns about compelling speech can be avoided by providing abstention options. Any concerns about criminalization can be mitigated by carefully implementing the penalty for non-voting in a way that takes account of economic status. Ultimately, I argue that a system of compulsory voting represents the most effective way to reduce voting discrimination and civic inequality in the United States.
Keywords: voting rights; discrimination; racism; classism; constitutional law; proposed legislation
Table of Contents
Introduction
I. The Voting Rights Act and Its Shortcomings
II. Advantages of Compulsory Voting
III. Difficulties in Enactment and Implementation
A. Constitutional Difficulties: Individual Rights
B. Constitutional Difficulties: Congressional Power
C. Concerns about Criminalization
D. Other Implementation Concerns
Conclusion
Appendix: Model Statute
Introduction
“If a single statute represents the best of America, it is the Voting Rights Act.”[1] So Justice Kagan proclaimed with lachrymose solemnity in the opening sentence of her Brnovich v. Democratic National Committee dissent. If those words were not yet an obituary for the Voting Rights Act (VRA), certainly they were an acknowledgment that the Act only lives under a do-not-resuscitate order. Brnovich, along with the Court’s earlier decision in Shelby County, Ala. v. Holder,[2] has left the VRA a shell of its former self. Congressional Democrats have proposed at least two bills—the For the People Act (a.k.a. H.R. 1)[3] and the John Lewis Act[4]—that would do much to restore the rights formerly protected by the VRA and to add new requirements promoting access to the ballot. However, even if enacted, these bills would still be insufficient to wholly solve the problem of voting discrimination and civic inequality in the United States.
I propose that Congress pursue a different legislative strategy altogether: make voting compulsory. Many instinctively recoil from this idea, but it has been implemented successfully in several other countries. As of 2021, at least twenty-seven democracies use some form of mandated voting.[5] In comparison to currently proposed legislation, instituting a compulsory voting scheme would offer more significant protection to voting rights by addressing to a much greater extent the social and economic causes of voting discrimination and civic inequality.
Implementing this proposal would not be a simple matter. There are serious constitutional issues at stake, including whether compulsory voting would violate the First Amendment and whether Congress has the power to enact such a plan. Additionally, a poorly designed compulsory voting scheme could end up criminalizing those who, in many cases, are already among the least privileged in this country. However, I believe that this plan, while unorthodox, would ultimately be constitutional, particularly if it includes provisions allowing one to opt out of the obligation. Concerns about criminalization can be overcome by careful attention to the implementation of the law.
In this essay, I will first elaborate on the inadequacies of the VRA and of recent legislative proposals to amend it. I will then examine a model statute for compulsory voting (located in the Appendix) and explain how a compulsory approach would better protect access to the ballot box. Finally, I will address the potential difficulties with the plan and discuss how they may be overcome.
I. The Voting Rights Act and Its Shortcomings
Before Shelby County and Brnovich, the VRA protected access to the ballot box in two principal ways. First, § 2 of the Act prohibited any state or political subdivision from adopting any voting procedure that “results in a denial or abridgement of the right . . . to vote on account of race or color.”[6] This right of action was a powerful tool to redress wrongs, but, as Congress had learned in the years preceding the VRA’s 1965 enactment, individual suits are poor vehicles for solving the systemic problem of voter disenfranchisement.[7] “Early attempts to cope with this vile infection resembled battling the Hydra” because as soon as courts struck one restriction down, two new methods of disenfranchisement would rise to take its place.[8] To address this “whack-a-mole” problem,[9] Congress enacted a “preclearance” requirement in § 5 of the Act, whereby certain states and counties with particularly egregious histories of resisting the Fifteenth Amendment’s extension of voting rights to all races would have to obtain approval from the Department of Justice (DOJ) before enacting any change to voting laws.[10] To determine which states and counties § 5 covered, Congress created a formula, enacted in § 4(b), which the DOJ followed in enforcing the Act. The formula applied § 5 to any jurisdiction that had previously used voting tests to control the franchise or that had less than 50% voter participation as of 1972 (in the most recent reauthorization), unless the jurisdiction had since made a showing of significant improvement.[11] Over the next five decades, Congress reauthorized the VRA four separate times.[12] The most recent reauthorization, in 2006, passed the Senate 98–0.[13]
Seven years later, in Shelby County, the Supreme Court invalidated the preclearance formula in § 4(b) with a 5–4 decision because—so it claimed—the formula was out of date.[14] Although the Court left § 5 intact,[15] that section cannot function without a coverage formula, meaning that it remains unenforceable unless and until Congress amends § 4(b) in a manner consistent with Shelby County’s holding. Section 2 remains good law, but it also remains subject to the whack-a-mole problem. Moreover, the Court has subsequently indicated in Brnovich that it will treat future § 2 cases with the utmost skepticism.[16] The result is that today states are free to enact blatantly discriminatory voting laws, and so long as they can articulate facially plausible excuses invoking “election security,” the law is likely to withstand judicial scrutiny.[17] Since Shelby County, more than thirty states have enacted restrictive voting laws.[18] 2021 alone saw more than 440 restrictive bills introduced across forty-nine out of fifty states in the country, with at least thirty-four bills becoming law.[19] Had these bills been subject to the VRA’s preclearance requirement, the DOJ almost certainly would have nixed a large portion.
This plethora of discriminatory laws clearly illustrates the problem created by the Court’s dismantling of the VRA. Yet, as strong a tool as the VRA was for protecting the right to vote, the extensive geographical breadth of the push to restrict voting also illustrates the weaknesses of the VRA’s approach. At the time of Shelby County, the VRA’s preclearance requirement applied to only nine states and some jurisdictions within six other states.[20] Thus, even if Shelby County had gone the other way, many of these bills (those from jurisdictions not covered by the § 4(b) formula) would never have been subject to the preclearance requirement. They would only have been addressed (if at all) through the “whack-a-mole” protection of § 2.
Additionally, even at its most expansive, the VRA could only address direct government action. It could do nothing about the myriad other socioeconomic factors that contribute to severe disparities in voter turnout along predictable demographic lines.[21] In the 2020 federal election, slightly more than two-thirds of adult citizens voted.[22] This paltry sum represents the highest turnout of the twenty-first century.[23] It is substantially lower than voter turnout in most, if not all, of our peer democracies—even those that do not use compulsory voting.[24] Indeed, “it is likely that no U.S. President has ever received a majority of the votes of the American adult population.”[25] Given that ours is a government supposedly constituted by “We the People,” such low turnout creates severe problems of legitimacy.
The American tradition of low turnout is not demographically neutral. In 2020, 70.9% of white non-Hispanic adults voted, but only 62.6% of Black adults voted.[26] When comparing by income, the differences become even starker. In 2020, only 47.1% of those with less than $10,000 in annual household income voted, compared to 84.8% of those with annual incomes greater than $150,000.[27] Age, too reveals significant disparities: eighteen-year-olds have the lowest voting rate by age (41.8% in 2020), while 78-year-olds have the highest rate by age (79.7% in 2020).[28] In short, the older, richer, and whiter you are, the more likely you are to vote (and also the more likely you are to be able to vote). These disparities in the demographics of voters and non-voters severely undermine our government’s claim to be a representative democracy.[29]
Some of the racial disparities in the 2020 election could stem from the restrictive voting laws passed since Shelby County. And, since Black people have lower incomes on average than white people, anything that contributes to a disparity of race in voting is also likely to contribute to disparities of income in voting (and vice-versa). In 2012, the last presidential election before Shelby County, Black adults voted at a rate of 66.2%—which was 3.6 points higher than in 2020 and, in fact, higher than that of white adults in 2012.[30] Moreover, given that 2012 had a much lower overall voting rate than 2020 (61.8% compared to 66.8%), the actual impact of the restrictive laws passed since 2013 is probably more like 9 points than 3.6.[31] However, the fact that Black turnout still reached only 66.2% even while the VRA was fully in force shows that the Court’s dismantling of the law can only partly explain today’s low turnout rate.
Consequently, any attempt to simply adopt a new preclearance formula will not be able to accomplish much more than the VRA itself was able to do. Even an expansion to the preclearance formula along the lines of the John Lewis Act[32] would likely be of only limited effect. Although adopting a new formula based on more recent voting data would make § 4(b) presumptively constitutional,[33] the current Court is more conservative than it was in 2013 and may be opposed to any federal intervention into state and local voting practices. When faced with a suit challenging a hypothetical new coverage formula, today’s Court could well follow the lead of Justice Thomas’s Shelby Countyconcurrence and find the preclearance requirement itself unconstitutional.[34] H.R. 1 takes a different approach from the John Lewis Act—it would adopt an omnibus package of election access protections—but it still fundamentally suffers from the “whack-a-mole” problem of § 2 of the VRA. Moreover, even if either of these bills completely halted government discrimination, they still would have only limited effect on the other social and economic factors that correlate with disparities in turnout.
II. Advantages of Compulsory Voting
Unlike H.R. 1 and the John Lewis Act, a compulsory voting scheme would significantly reduce voting discrimination and civic inequality. In support of this claim I have drafted portions of a model statute (see Appendix A). My model statute is incomplete, as many of the specific details would need to be rooted in far more extensive research than is feasible in a blogpost of this sort. But its core requirement is quite simple:
§ 3. All persons in the United States shall be required by law to vote in every governmental election in which they are legally permitted to vote.
The language of this provision establishes that, if one may vote in an election, then one must. It applies not only to federal elections but also to state and local elections.[35] Although many details of implementation must still be worked out (some of which I discuss below), this core requirement would provide notable advantages over H.R. 1 and the John Lewis Act, as well as the pre-Shelby County VRA.
First, and most obviously, this statute would increase voter turnout across the board. As political scientist Jill Sheppard notes, “the literature is almost unanimous in finding compulsion increases voter turnout at the aggregate level.”[36] Some commentators have described low voter turnout as a sort of “collective action” problem—“If left to individual choice, the level of voting theoretically will be below the socially optimal level. Like jury service, taxes, and the draft, compulsory voting is a legitimate way to solve such a market failure.”[37] Although one should not characterize the act of not voting as a simple “choice”—with no attention paid to broader socioeconomic and historical factors—the fact remains that some people do simply choose not to vote, and for a variety of reasons. Increasing the direct cost of not voting, even only marginally, is likely to have significant effects. Some studies have shown that compulsory voting laws increase voter turnout across the board by seven to sixteen points.[38] Moreover, given that the United States would start from such a low turnout baseline, the effects might be particularly strong in this country.[39]
Evidence indicates that compulsory voting disproportionately boosts turnout among groups whose voting rates would otherwise be disproportionately low. Sheppard observes that “Compulsion increases turnout among socioeconomically disadvantaged citizens, reducing the stratification between voters and non-voters evident in democracies where voting is concentrated among those citizens with high socioeconomic status.”[40] Shane Singh similarly concludes that “the voting population will be more reflective of the entire electorate in compulsory systems.”[41] Additionally, these authors’ studies focus on the socio-economic effects of imposing a penalty for non-voting, which is, unsurprisingly, likely to have a disproportionately strong effect on those who would otherwise be unlikely to vote. However, my model statute aims to further increase the effectiveness of compulsory voting in increasing turnout among the young, poor, and non-white by imposing a duty upon all governments not to restrict one’s fulfillment of the obligation to vote:
§ 3(a). No government entity or agent shall restrict any person from fulfilling the legal obligations imposed by this section. No private entity or person shall intentionally and substantially restrict any person from fulfilling that obligation.[42]
Third, a compulsory voting obligation would solve some of the fundamental shortcomings of the VRA. By implementing a simple nationwide standard, this model statute would apply across the entire country, rather than only in a handful of preclearance states and counties. Moreover, it would obviate the need for any coverage formula whatsoever and would thereby avoid the constitutional difficulty of “depart[ing] from the fundamental principle of equal sovereignty” that led the Shelby County Court to strike down § 4(b) of the VRA.[43] Additionally, compulsory voting would likely reduce the “whack-a-mole” problem dramatically. Rather than evaluating whether a voter-restrictive policy was one of many factors that led a voter to stay home, courts would instead inquire whether it restricted a citizen from fulfilling their legal duty. When the background assumption is that citizens need to fulfill an obligation, rather than choose whether to exercise a right, then interference should become considerably easier to spot.
A plan of compulsory voting along the lines proposed in the model statute would alleviate the shortcomings of § 2 and § 5 of the VRA. Even more importantly, it could address the socioeconomic factors underlying much of voting discrimination and civic inequality in this country—factors that the VRA and recent legislative proposals could never hope to address. In doing so, it would more greatly alleviate voting discrimination and civic inequality and would have a secondary benefit of raising voter turnout across the board. This would lead to a more legitimate government that is better equipped to respond to the voices of the people who constitute it.
III. Difficulties in Enactment and Implementation
Any federal plan of compulsory voting will need to overcome several significant difficulties of enactment and implementation. Here I am interested in legal and practical difficulties. Consequently, I put aside the most obvious problem, which is that Congress is unlikely to endorse this model statute or a similar one at any point in the near future. Instead, I focus, first, on whether a law like the model statute would be constitutional; and, second, on how to implement the law without also criminalizing those who do not comply with it.
A. Constitutional Difficulties: Individual Rights
The constitutional difficulties with a compulsory voting scheme are potentially numerous. The first category of problems relates to individual rights. While some of these issues can be side-stepped by allowing potential voters to opt out of the obligation, the constitutional issue is still worth exploring.
Does the right to vote also imply the right not to vote? Such an implication might seem intuitively to be the case. After all, not even the most zealous gun rights advocate would hold that the Second Amendment compels people to bear arms. Nevertheless, the Supreme Court has held on numerous occasions that the right to one thing “does not ordinarily carry with it the right to insist upon the opposite of that right.”[44] Many examples occur in the context of criminal procedure. For example, the constitutional right to a public trial does not imply the right to a private trial,[45] and the right to a jury trial does not necessarily imply the right to a bench trial, or even the right to forego a trial altogether.[46]
Some examples occur in the civil context as well. For example, the right to a minimum wage does not permit an employee to agree to work for less than that amount.[47] Here the reasoning is instructive: one cannot waive the right to a minimum wage because doing so “would ‘nullify the purposes’ of the [Fair Labor Standards Act] and thwart the legislative policies it was designed to effectuate.”[48] In other words, if an employer could simply choose to hire those who were willing to waive their right to a minimum wage, then that would effectively nullify the right for all other workers.
In a similar manner, the right to vote can also be construed as a duty to vote—because the public has an interest in having the American government accurately represent the body of its constituents. As one author argues, “The individual act of voting is essential to the collective’s ability to have democratic government, and as such should not be waivable.”[49] Much like the right to jury trial imposes a duty of jury service, the right to constitute the government should also create a duty to constitute the government.
Another spin on the individual rights problem is the question of whether a duty to vote constitutes a governmental compulsion of speech in violation of the First Amendment. Unlike the rights discussed above, the right to free speech does contain the right not to speak.[50] However, this is not because the First Amendment implicitly includes its opposite; rather, free speech includes the right to stay silent because silence is itself a form of speech.[51] Here there is a close analogy to voting—one could argue that not voting is actually a means of exercising the franchise, in addition to being a form of speech. However, both difficulties can be avoided by simply allowing persons to opt out of the obligation. The model statute addresses this concern in a number of ways, the most important of which is the following:
§ 4. All ballots in elections affected by this Act shall have an abstention option.
Additionally, the model statute contains a provision (§ 4(a)) allowing one to notify the government in advance of an intent not to vote, which serves as an absolute defense against any charge of non-compliance. By supplying these abstention options, the government avoids a quandary in which it might end up forcing one to vote for a candidate whom one cannot support. Additionally, the lightness of the penalty for not voting (discussed below) further diminishes the extent to which the government could be considered as compelling speech through this law.
B. Constitutional Difficulties: Congressional Power
The second category of constitutional difficulties relates to congressional authority to institute compulsory voting. Section 4 of Article I of the United States Constitution gives Congress the power to control some aspects of Senate and House elections.[52] When the Constitution was ratified in 1789, it explicitly left primary control over presidential elections to the states,[53] and no provision gave Congress any power over state and local elections. Since then, however, the Fifteenth, Nineteenth, and Twenty-sixth Amendments have given Congress some power over all government elections by granting it the power to pass legislation enforcing voting rights on the respective bases of race, sex, and age.[54] As noted above, significant disparities in voting exist along racial, gender,[55] and age lines.[56] Because compulsory voting would alleviate these disparities,[57] Congress would have the power to compel states to follow the model statute.[58]
Critically, the Court has held that “The Fifteenth Amendment empowers ‘Congress,’ not the Court, to determine in the first instance what legislation is needed to enforce it”[59]—and the same logic would apply to the Nineteenth and Twenty-sixth Amendments, since they empower Congress through identical language. Granted, the Shelby County Court held that, in reauthorizing § 4(b) of the VRA, Congress exceeded the powers granted to it under the Fifteenth Amendment—but the problem there was a failure to respect the “fundamental principle of equal sovereignty among the states.”[60]Such a problem would not present itself under the model statute, which would bind all states equally.
As a fallback position, even if the Court were to find lacking Congress’s power to regulate state and presidential elections pursuant to the Fifteenth, Nineteenth, and Twenty-sixth Amendments, Congress would still retain its Article I, Section 4 power to regulate congressional elections.[61] Severability provisions in the model statute (see § 8) express Congress’s intent for the construction of the statute in the event that any provisions are found unconstitutional. These severability provisions instruct the Executive Branch to enforce the statute as written, minus any unconstitutional sections. They should ensure that Congress maintains the power to compel voting in congressional elections, even if the Court strikes down other parts of the statute.[62] Although a narrow power over congressional elections would be a blow to the ultimate goals of the model statute, even this remaining compulsion would likely prove quite effective in encouraging higher turnout rates for state and local elections. Because states and municipalities tend to hold many of their elections on the same days as congressional elections, the fact that voters would be compelled to go to the poll anyway—to vote for a Representative or Senator—means that they would also be likely to also vote for whatever other local, state, and federal matters are present on the same ballot.
C. Concerns about Criminalization
This statute is designed to alleviate voting inequality along racial, economic, and age lines. It does so by imposing a penalty—a form of criminalization—on those who do not vote. However, this criminalization introduces a number of related problems. First, the demographics that the statute aims to help (those who are less likely to vote) are also those most at risk of criminalization from a compulsory voting scheme. Second, it is well-established that poorer and non-white people are more likely to have negative interactions with the police.[63] This structurally racist and classist reality means that enforcement of the law is likely to fall disproportionately on people of color and the poor, even given the sociological realities of the first problem. Third, the demographics most at risk of criminalization are also those that would be most disproportionately harmed by the penalties the statute imposes, owing to lower average wealth.
These are major drawbacks to any plan of compulsory voting. Without careful implementation they could become so severe as to outweigh compulsory voting’s benefits. Consequently, the model statute incorporates several measures to eliminate or diminish this counterproductive potential result as much as possible. It does this, first, by adopting a relatively minor penalty that takes economic status into account, thus minimizing the impact of criminalization on the poor, the young, and people of color. Second, it aims, where possible, to shift the penalty for non-voting onto those who are more able to bear it, such as bosses who refuse to grant their employees time off to vote.
Countries that have adopted compulsory voting use a number of different enforcement mechanisms.[64] Some countries, such as Brazil and Peru, tie proof of voting to certain social benefits rather than imposing a direct punishment.[65] This is also the approach taken by the Selective Service System in the United States: although one can nominally be prosecuted for failing to register for the draft, in practice the punishment is restriction in access to government benefits such as driver’s licenses.[66] Such a system could conceivably work in the voting context, but I am hesitant to adopt it for at least two reasons. First, those who are less likely to vote are also more likely to be reliant on government benefits, and the processes of obtaining those benefits are already byzantine enough in this country.[67] Second, registering for the draft is a one-time obligation that one can fulfill at any time, which means that non-compliance has an easy remedy—registering later. Conversely, elections happen frequently, but only on specific days, which means that “curing” one’s status as a non-voter could only occur at the next election.
I have instead opted in the model statute to follow an approach like Australia’s, where the government can fine those who do not vote.[68] A simple fine can calibrate the penalty for non-compliance so that it does not severely impact even the destitute but still creates enough of an annoyance to ensure that most people comply. Moreover, the statute instructs the agency administering the statute to exercise discretion in deciding whether to impose a fine (§ 7(c)) and must particularly take into account the likelihood of significant hardship resulting from enforcement (§ 7(b)). Those issued a fine are also permitted several enumerated legal defenses (§§ 7(c)(2)–(5)), and the statute expressly prohibits bringing any sort of criminal prosecution to enforce the Act (§ 7(a)). Together, these restrictions on enforcement should create a situation in which the state’s power to compel adherence to the law is actually rather minimal, but its mere possibility still substantially increases turnout.
Additionally, when people are unable to vote because larger structures have prevented their access to the ballot—for example, a boss who refuses to allow employees time to vote—then it would be unjust to impose a penalty on the non-voters. For this reason, as I noted above,[69] the model statute establishes penalties on those who “intentionally and substantially restrict any person from fulfilling” their obligation to vote (§ 3(a)). It also incorporates several measures designed to increase access to the ballot box. These provisions allow the statute, where possible, to shift the penalty for non-voting onto those creating socioeconomic forces responsible for keeping potential voters away from the polls, rather than further penalizing those who have already been disenfranchised.[70]
Finally, the minor criminalization imposed by this statute could also prove to be self-correcting. Because a scheme of compulsory voting would have the effect of increasing the governmental power of marginalized persons, the government would likely become more responsive to their needs. In time, this would hopefully reduce the number of people who would be disproportionately impacted by enforcement of the law.
D. Other Implementation Concerns
Many details of the model statute still need to be ironed out to ensure its effective implementation. For example, the model statute contains provisions that would make election days government holidays and provide a specific right of action against employers who punish employees for visiting the polls (§§ 6(b), (c), (e)). Further provisions ensuring access to the ballot box are necessary. Discussion of these provisions and potential provisions is beyond the bounds of this essay, except to note that ensuring that one has a substantial opportunity to easily fulfill the obligation to vote is another necessary measure to ensure that the statute criminalizes as little as possible.
Conclusion
Voting is what ensures that the American government is composed “of the people, by the people, for the people.” But for that very same reason, the right to vote also implies a duty to vote. Low rates of voter turnout—and, in particular, disproportionately low rates along racial, income, and age lines—pose a major threat to the legitimacy of the government by undermining the public’s ability to make the government comport with its wishes. Although the VRA and recently proposed legislation have and would reduce voting discrimination and civic inequality, they are insufficient to address the full breadth of the problem. Adopting a compulsory voting scheme pursuant to Congress’s constitutional powers under the Fifteenth, Nineteenth, and Twenty-sixth Amendments, as well as Article I, Section 4, could considerably ameliorate these issues. Although significant concerns remain regarding criminalization under such a scheme, careful implementation, guided by the principle of avoiding hardship to those who are already most marginalized in American society, should be able to almost entirely eliminate the criminalization that would ensue from enforcing the model statute. Consequently, I believe that a careful system of compulsory voting represents the most effective way to reduce voting discrimination and civic inequality in this country.
Appendix: Model Statute
§ 1. Definitions. In this Act, the following definitions shall apply:
(a). “Election” means any official government poll, whether for the election of officials, amending state statutes or constitutions, or any other purpose.
(b). “Employee” shall be construed to include both employees and independent contractors.
(c). [. . .]
§ 2. Congressional Findings. [Among the findings to be included here would be ones showing particular racial, age, and gender disparities in voting turnout that would be resolved by enacting and enforcing this statute.]
§ 3. Obligation to Vote. All persons in the United States shall be required by law to vote in every governmental election in which they are legally permitted to vote.
(a). No government entity or agent shall restrict any person from fulfilling the legal obligations imposed by this section. No private entity or person shall intentionally and substantially restrict any person from fulfilling that obligation.
(1). For the purposes of subsection (a), it shall not be considered a restriction to close polling places at a previously posted time of 7pm local time or later, except that every eligible person who enters or stands in line to enter a polling place prior to closure shall be permitted to vote.
(b). Any person whose obligations are restricted in the manner forbidden by subsection (a) shall have a right of action against the person or entity who violated that subsection.
(c). The Department of Justice shall also have a right of action against anyone who violates subsection (a).
(d). In all suits under this section, a successful plaintiff may seek compensatory, nominal, and punitive damages, as well as attorney’s fees.
§ 4. Right of Abstention. All ballots in elections affected by this Act shall have an abstention option.
(a). Any person may submit to the Voting Compliance Agency a notice of intent not to vote. Submission of such a notice at least two weeks before any election will be accepted as an absolute excuse from the obligation to vote in that election.
(b). Filing an intent not to vote does not place any restrictions on the filer’s ability to vote, nor shall it be construed under any circumstances to constitute a waiver of one’s right to vote. No government entity or agent shall in any way hinder a voter on the basis of a previously filed intent not to vote.
§ 5. Administration. This Act shall be administered by the Voting Compliance Agency (VCA), a new independent agency to be created upon passage of this Act. The VCA shall have the authority to issue regulations consistent with this Act to ensure its effective implementation.
(a). The head of the VCA shall consist of a board of five commissioners, each of whom shall be appointed by the President for a term of ten years, and who may only be removed from office for negligence or malfeasance.
(b). The terms of the commissioners shall be staggered, so that one commissioner is replaced or retained every two years.
(c). [. . .]
§ 6. Ensuring Access to the Ballot.
(a). No voting precinct may contain more than 500 voters, unless that precinct conducts its elections exclusively through mail voting.
(b). Any day on which a federal election occurs shall be a federal holiday. Any day on which a statewide vote occurs shall be a government holiday within that state. Any day on which a county or municipality election occurs shall be a government holiday within that voting district.
(c). For the purposes of subsection (b), all federal elections shall also be considered to be statewide, county, and municipal elections. All statewide elections shall also be considered to be county and municipal elections within that state.
(d). Municipalities, counties, and states shall hold elections for their respective governments on the same day as federal elections, unless there is a compelling government interest for doing otherwise.
(e). No employer may fire, sanction, or otherwise punish any employee for taking time off to vote. Anyone who suffers a violation of this subsection—and notwithstanding subsection 3(a)—will have standing to bring suit against the violator. A successful plaintiff may be awarded compensatory, nominal, and punitive damages, as well as attorney’s fees.
(f). Except for precincts that conduct elections exclusively through mail voting, all elections shall be immediately preceded by at least seven consecutive days in which in-person early voting is allowed.
(g). Voters shall be permitted to submit ballots via mail for any election.
(1). Mail ballots shall be distributed at least two weeks ahead of any election.
(2). Any ballot postmarked on or before the day of an election shall be counted.
(h). [. . .]
§ 7. Compliance.
(a). Under no circumstances shall any criminal prosecution occur for a violation of this Act or any other state or municipal law instituting compulsory voting, nor shall failure to pay a fine levied under this Act constitute grounds for jailing or imprisonment.
(b). In all acts of discretion related to the enforcement of this Act, the VCA shall particularly take into account the likelihood of substantial economic hardship resulting from enforcement.
(c). Upon suspicion that an eligible voter has failed to vote in an election, the VCA shall have discretion to issue a fine to the suspected non-voter.
(1). The amount of the fine shall be approximately 5% of the non-voter’s monthly income, subject to the VCA’s discretion. A lesser fine shall be issued if the standard fine would impose substantial economic hardship.
(2). Upon being issued a fine, a defendant may establish by clear and convincing evidence that they either fulfilled their legal obligation to vote or notified the VCA of their intent not to vote pursuant to subsection 4(b).
(3). Alternatively, a defendant may provide an excuse for not voting, such as mental or physical incapacity, moral opposition, interference from a government entity or other third party, or some other legitimate reason for not having voted. The VCA shall accept this excuse unless it finds either:
(A). That the given excuse is invalid on its face; or
(B). By clear and convincing evidence that the given excuse is false.
(4). Upon acceptance of a defendant’s excuse or evidence of voting, the VCA shall dismiss the fine.
(5). All decisions of the VCA related to fines may be appealed to a Federal District Court with geographic jurisdiction over the suspected non-voter.
(d). [. . .]
§ 8. Severability.
(a). In the event that the Supreme Court finds § 2 of this Act unconstitutional for lack of congressional power to control state or local elections, it is the intention of Congress that the section shall be construed to apply only to federal elections.
(b). In the event that the Supreme Court finds § 2 of this Act unconstitutional for lack of congressional power to control presidential elections, it is the intention of Congress that the section shall be construed to apply at the federal level only to congressional elections.
(c). In the event that the Supreme Court finds § 2 of this Act unconstitutional for any other reason, or finds any other part of this Act unconstitutional, it is the intention of Congress that the unconstitutional provisions shall be severed from the Act. Thereafter, the remaining provisions of the Act shall still be enforced as written.
§9. Effective Date.
(a). Sections 3, 6, and 7 of this Act will become effective six months prior to the first federal election that takes place at least two calendar years following the passage of this Act into law.
(b). All other sections will become effective immediately upon passage.
[1] Brnovich v. Democratic Nat’l Comm., 141 S.Ct. 2321, 2350 (2021) (Kagan, J., dissenting).
[2] Shelby Cnty., Ala. v. Holder, 570 U.S. 529 (2013).
[3] H.R. 1, 117th Cong. (2021).
[4] Id.
[5] Compulsory Voting, Int’l Inst. for Democracy & Electoral Assistance, https://www.idea.int/data-tools/data/voter-turnout/compulsory-voting(last visited May 4, 2022).
[6] Voting Rights Act of 1965 § 2, 52 U.S.C. § 10301.
[7] Shelby Cnty., 570 U.S. 561 (Ginsburg, J., dissenting).
[8] Id. at 560.
[9] Brnovich v. Democratic Nat’l Comm., 141 S.Ct. 2321, 2354 (2021) (Kagan, J., dissenting).
[10] Id. (Kagan, J., dissenting) (discussing VRA’s legislative history).
[11] Shelby Cnty., 570 U.S. at 538 (“Among other prerequisites for bailout, jurisdictions and their subdivisions must not have used a forbidden test or device, failed to receive preclearance, or lost a § 2 suit, in the ten years prior to seeking bailout.”); see also 28 C.F.R. app. pt. 51 (containing a list of jurisdictions covered under the § 4(b) formula as of April 15, 2011).
[12] Shelby Cnty., 570 U.S. at 538.
[13] Id. at 565 (Ginsburg, J., dissenting).
[14] Id. at 557 (faulting Congress for failing to update the formula since 1975); but see id. at 576–94 (Ginsburg, J., dissenting) (providing a significant refutation of the claim that the formula was out of date).
[15] Id. at 557.
[16] See Brnovich v. Democratic Nat’l Comm., 141 S.Ct. 2321 (2021).
[17] Id. at 2339–40.
[18] See P. R. Lockhart, How Shelby County v. Holder Upended Voting Rights in America, Vox (June 25, 2019, 7:49 PM), https://www.vox.com/policy-and-politics/2019/6/25/18701277/shelby-county-v-holder-anniversary-voting-rights-suppression-congress.
[19] Voting Laws Roundup: December 2021, Brennan Ctr. for Just. (Jan. 12, 2021), https://www.brennancenter.org/our-work/research-reports/voting-laws-roundup-december-2021.
[20] Jurisdictions Previously Covered by Section 5, U.S. Dep’t Just. (Nov. 29, 2021), https://www.justice.gov/crt/jurisdictions-previously-covered-section-5.
[21] See Lisa Hill, Low Voter Turnout in the United States: Is Compulsory Voting a Viable Solution?, 18 J. Theoretical Pols. 207, 210–12 (Apr. 2006) (discussing many of the factors that lead to low turnout in the United States; among the more common factors are inability to get time off from work, difficulty in registering, low motivation, and complexities of federalism).
[22] 2020 Presidential Election Voting and Registration Tables Now Available, U.S. Census Bureau (Oct. 8, 2021), https://www.census.gov/newsroom/press-releases/2021/2020-presidential-election-voting-and-registration-tables-now-available.html.
[23] Id.
[24] See Note, The Case for Compulsory Voting in the United States, 121 Harv. L. R. 591, 591 (2007).
[25] Id. at 594.
[26] Voting and Registration in the Election of November 2020, U.S. Census Bureau (Oct. 28, 2021), https://www.census.gov/data/tables/time-series/demo/voting-and-registration/p20-585.html
[27] Id.
[28] Id.
[29] See Hill, supra note 21, at 209 (“Perhaps the most important value that is undermined by high levels of non-voting is political equality.”).
[30] Voting and Registration in the Election of November 2012, U.S. Census Bureau (Oct. 8, 2021), https://www.census.gov/data/tables/2012/demo/voting-and-registration/p20-568.html.
[31] If the Black turnout had increased at the same rate as the overall vote between 2012 and 2020, then we would expect the Black turnout in 2020 to be about 71.6%. Comparing the actual Black turnout in 2012 (62.4%) with the actual Black turnout in 2020 (66.2%) yields a discrepancy of 3.6 points, whereas comparing the actual Black 2012 turnout to the expected Black 2020 turnout yields a discrepancy of 9 points.
[32] The John Lewis Act would update the coverage formula of § 4(b) of the VRA to cover, inter alia, states in which “fifteen or more voting rights violations occurred . . . during the previous 25 calendar years.” H.R. 4, 117th Cong. § 5(b)(1)(A)(i) (2021).
[33] The Court explicitly stated that “Congress may draft another formula based on current conditions.” Shelby Cnty., Ala. v. Holder, 570 U.S. 529, 557 (2013).
[34] Id. at 557–59 (Thomas, J., concurring).
[35] I use “person,” rather than “citizen,” because some cities—such as New York—allow non-citizens to vote in municipal elections.
[36] Jill Sheppard, Compulsory Voting and Political Knowledge: Testing a ‘Compelled Engagement’ Hypothesis, 40 Electoral Stud. 300, 301 (2015).
[37] Case for Compulsory Voting, supra note 24, at 601; see also Sheppard, supra note 36, at 301.
[38] Arend Lijphart, Unequal Participation: Democracy’s Unresolved Dilemma, 91 Am. Pol. Sci. Rev. 1, 8–9 (1997).
[39] Case for Compulsory Voting, supra note 24, at 592; see also Lijphart, supra note 38, at 9 (discussing the drop in turnout from 90.2% to 60.2%—a rate roughly similar to U.S. voter turnout—after Venezuela repealed its compulsory voting law).
[40] Sheppard, supra note 36, at 301.
[41] Shane P. Singh, Compulsory Voting and the Turnout Decision Calculus, 63 Pol. Stud. 548, 565 (2015).
[42] Details concerning rights of action may be found in §§ 3(b)–(d). The different standard for private actors is intended to avoid liability for minor and unintentional restrictions that might occur in everyday life.
Here it should be noted that H.R. 1 and the model statute are complementary. If H.R. 1 were to be enacted, the model statute would gain strength from the bevy of requirements protecting access to the ballot that the For the People Act would create. Any violation of H.R. 1’s requirements would also violate § 3 of the model statute by placing a restriction on fulfilling the obligation to vote. See also infra text accompanying note 70.
[43] Shelby Cnty., Ala. v. Holder, 570 U.S. 529, 542 (2013).
[44] Singer v. United States, 380 U.S. 24, 34–35 (1965).
[45] Id. at 35 (citing United States v. Kobli, 172 F.2d 919, 924 (3d Cir. 1949)).
[46] Id. at 36 (holding that a defendant’s ability to waive the right to jury trial is conditional on the prosecutor and the trial judge being willing to accept a plea deal).
[47] Barrentine v. Ark.-Best Freight Sys., Inc., 450 U.S. 728, 740 (1981).
[48] Id. (citation omitted).
[49] Case for Compulsory Voting, supra note 24, at 600.
[50] See W. Va. State Bd. of Educ. v. Barnette, 319 U.S. 624 (1943).
[51] Id. at 634 (“[A] Bill of Rights which guards the individual’s right to speak his own mind, [does not] le[ave] it open to public authorities to compel him to utter what is not in his mind.”).
[52] U.S. Const. art. I, § 4.
[53] Id. art. II, § 1, cl. 2. Congress’s only Article II power over presidential elections is the power to set the time and date of the election. Id. cl. 4.
[54] U.S. Const. amend. XV, § 2; id. amends. XIX, XXVI, § 2.
[55] I did not discuss gender disparities in Part I because women vote at a higher rate than men; this has been the case for decades. Participation in Congressional Elections by Sex Since 1978, U.S. Census Bureau (Oct. 8, 2021), https://www.census.gov/library/visualizations/2020/comm/participation-congress-election.html. Voting turnout is thus not a pressing site of structural gender discrimination. However, the Supreme Court has held that laws discriminating against men are unconstitutional. See Craig v. Boren, 429 U.S. 190 (1976). Thus, the fact that men vote at a lower rate may also constitute a problem that is within Congress’s Nineteenth Amendment purview to correct.
[56] See supra Part I.
[57] Note that many of these disparities may be due to disparate impact rather than discriminatory intent. However, that should not pose a problem. Although the Constitution itself often forbids only government action motivated by discriminatory intent, see Washington v. Davis, 426 U.S. 229, 239 (1976), Congress has the power to adopt legislation that uses disparate impact to determine when discrimination has occurred. The Supreme Court has expressively approved of legislation, such as certain portions of Title VII, 42 U.S.C.A. § 2000e-2, that use disparate impact in this manner. See, e.g.,Griggs v. Duke Power Co., 401 U.S. 424, 430 (1971) (unanimously holding that Title VII forbids “practices, procedures, or tests neutral on their face, and even neutral in terms of intent” that nevertheless discriminate).
[58] Congress may also be able to address inequality along other lines through the Fourteenth Amendment, although the Court’s doctrine of suspect classes may limit its power to do so.
[59] Nw. Austin Mun. Util. Dist. No. One v. Holder, 557 U.S. 193, 205 (2009).
[60] Shelby Cnty. v. Holder, 570 U.S. 529, 544 (2013) (internal quotation marks and emphasis omitted).
[61] U.S. Const. art. I, § 4.
[62] Seila L. LLC v. Consumer Fin. Prot. Bureau, 140 S.Ct. 2183, 2209 (U.S. 2020) (“When Congress has expressly provided a severability clause . . . [w]e will presume ‘that Congress did not intend the validity of the statute in question to depend on the validity of the constitutionally offensive provision[.]’”) (citation omitted).
[63] See generally Reuben Jonathan Miller & Amanda Alexander, The Price of Carceral Citizenship: Punishment, Surveillance, and Social Welfare Policy in an Age of Carceral Expansion, 21 Mich. J. Race & L. 291 (2016).
[64] Case for Compulsory Voting, supra note 24, at 611.
[65] Id.
[66] Id.
[67] See, e.g., Marla McDaniel, Michael Karpman, Genevieve M. Kenney, Heather Hahn, & Eleanor Pratt, Urb. Inst., Customer Service Experiences and Enrollment Difficulties Vary Widely across Safety Net Programs (Jan. 2023), https://www.urban.org/sites/default/files/2023-01/Customer%20Service%20Experiences%20and%20Enrollment%20Difficulties%20Vary%20Widely%20across%20Safety%20Net%20Programs.pdf.
[68] Id.
[69] See supra note 42.
[70] The model statute also allows a suspected non-voter to sue others who restrict their access to the ballot (§ 3(b)) and to present evidence of being kept from the polls as an excuse against a levied fine (§ 7(c)(3)).
Abstract
Historically disadvantaged groups, like Native American tribes, faced a difficult time during the COVID-19 pandemic. This Blogpost seeks to bring attention to the difficulties Native American tribes face when accessing healthcare by focusing on the Acoma Pueblo tribe in New Mexico, which illustrates the need for better access to healthcare for Native American tribes in rural areas.
The Blogpost discusses the litigation case between the Acoma Pueblo and the Department of Health and Human Services and funding issues for the Acoma-Cañoncito-Laguna Hospital, while providing a historical background on the Acoma Pueblo. Furthermore, this Blogpost provides a similar healthcare access issue faced by a fellow New Mexico tribe, the Laguna Pueblo. The Laguna Pueblo’s resolution illustrates an alternative for how funding of healthcare facilities for Native American tribes can be handled to the advantage of the Native American tribes who need healthcare facilities.
Keywords: Acoma Pueblo, Pueblo of Acoma, New Mexico Native American Communities, Laguna Pueblo, Native American Affairs, Healthcare Policy, American Indian Law, COVID-19 Healthcare Challenges, Native American Healthcare, Department of Health and Human Services
Table of Contents
Introduction
I. A Historical Perspective and Hospital Cuts During a Healthcare Crisis: The Acoma Pueblo’s Suit Against the Department of Health & Human Services
II. Litigation
III. Looking Over the Issue of Funding and Possible Solutions
Introduction
The COVID-19 pandemic has affected people across socioeconomic levels and geographic regions around the globe. However, historically disadvantaged groups, including economically, socially, politically, and a combination thereof, have seen themselves disproportionately affected. This Blogpost explains how a Native American Tribe, the Pueblo of Acoma, has fared during this difficult time. My experience working for a government agency in the Southwest before law school brought awareness about the Native American tribes in the region. I was aware of their vulnerable position prior to the pandemic, and I wanted to see how tribes in the Southwest fared during the acute period of the health crisis. The Acoma Pueblo are one example of the disadvantages and injustices Native American tribes faced during the crisis, and I am using their example to bring attention to them and inspire readers to look into how states treat tribes during crises. In addition, this Blogpost discusses ongoing litigation involving the United States Department of Health and Human Services (HHS) and Indian Health Service (IHS), hospital funding cuts, and diminished resources and staffing during the crisis.
This Blogpost invites readers to become familiar with the hardship the Acoma Pueblo faced during the pandemic. While this period of time was difficult across geographies and cultures, the Acoma Pueblo have a specific history of struggle, which is unfortunately familiar to Native American Nations in the United States. Among other tribes, the Navajo, Blackfeet, and Gros Vente faced similar limitations in access to healthcare. However, this Blogpost focuses on the Acoma Pueblo to analyze this issue in more detail. Governmental agencies and states should ensure tribes have access to healthcare and other necessities, because helping to preserve tribes and their unique heritages should be a priority.
In Part I, this Blogpost introduces the Acoma Pueblo and their access to health care, outlining the hospital funding and staffing cuts during the peak of the pandemic, which led to a lawsuit against HHS. Then, it goes over the colonization of the Acoma Pueblo and their historical background. Part II reviews the Acoma Pueblo’s complaint and provides more detail on the unfair situation the Tribe faced by being deprived of appropriate healthcare access. Lastly, Part III returns to the healthcare funding issue and goes over possible solutions that would benefit the Acoma Pueblo.
I. A Historical Perspective and Hospital Cuts During a Healthcare Crisis: The Acoma Pueblo’s Suit Against the Department of Health & Human Services
This section starts by introducing the reader to the healthcare access issue faced by the Acoma Pueblo, which prompted a lawsuit against HHS. The Pueblo of Acoma, or the Acoma Pueblo, is a rural community in Cibola County, New Mexico, about sixty miles from Albuquerque, with Sky City as the center of their settlement.[1] Their lands cover 411.5 square miles with a population of 2784.[2] 18% of the Acoma population are over fifty years old, and 20% of their senior citizens live below the poverty line.[3] A federally recognized tribe, the Acoma Pueblo, historically had settlements over an estimated 5,000,000 acres.[4] They have lived in the region for over 2000 years, making them one of the oldest continuously inhabited communities in the United States, together with the Hopi.[5] However, fewer than fifty tribal members remain year-round in what remains of Sky City.[6] They tend to San Estévan del Rey Mission, a historical landmark that Spaniard missionaries and colonizers founded in their tribal land.[7] The remaining tribal members live outside Sky City in Anzac, Acomita, and McCarty’s villages.[8] The tribe’s land passed from Mexico to the United States under the Treaty of Guadalupe Hidalgo in 1848.[9] Throughout their interactions with Spanish, Mexican, and American governments, the Pueblo of Acoma have remained a sovereign Indian nation.[10]
When the COVID-19 pandemic started in 2020, the travel requirements for the tribe members, together with their health, population size, and age, made the Acoma Pueblo particularly vulnerable to the virus. The isolation of the tribe can be perceived as an advantage during a situation like a pandemic. However, the community’s isolation ended up making the community more susceptible to the virus once it found its way into the community. In a way, they were “trapped” with it.
Many tribe members live and work outside the central area of the reservation but return to the reservation for communal traditions. Thus, they risked contracting the virus by interacting with people outside the tribe, which increased the spread of COVID-19 within the tribe. The Acoma Pueblo population is approximately 18% over the age of fifty, which is an age group more susceptible to illness and other medical conditions.[11] Furthermore, 20% of Acoma Pueblo senior citizens live under the poverty line, which is not surprising given statistics showing that rural populations are generally poorer and suffer from higher rates of chronic illness.[12] These factors together are enough to raise concern about any isolated rural population.
The Acoma-Cañoncito-Laguna (ACL) Hospital is the reservation’s only IHS unit, assisting the 9100 tribal citizens in the region as their local health services provider.[13] Outside of this facility, the next available one is sixty miles away and can only be reached by driving. The hospital found itself with a budget shortfall on an already tight budget as the public health crisis of the pandemic began, and available beds dwindled when the number of cases rose in November 2020.[14] The financial shortfall caused the hospital to cut seventy-six of its 135 full-time employees, the inpatient critical care unit, the emergency room, and women’s services.[15] As a result, the hospital turned patients away, directing them to drive sixty miles to Albuquerque or wait for ambulance transportation.[16] The poverty prevalent in the tribe[17]means that not all Acoma Pueblo people possess the means to travel such distance. The long drive required also increases safety risks because a higher percentage of vehicle accidents and fatalities occur in rural areas.[18] Further, driving while sick or during an emergency exacerbates the risk of an accident, as medical conditions can impair the cognitively complex task of driving.[19]
Since the 1970s, the Acoma Pueblo and other tribes in the vicinity have relied on the ACL Hospital for most healthcare needs.[20] The services offered are all-encompassing including dental, pharmaceutical, internal medicine, and optometry departments.[21] The ACL was a one-stop-shop for tribal members in the area, which mitigated the travel burden for medical and preventive services. In addition, this arrangement importantly served their populations at risk due to their isolation in rural communities and significant poverty.
Unfortunately, funding for the ACL Hospital was inadequate during the critical time of 2020. This shortcoming stems from IHS, which operates the ACL Hospital. IHS covers medical bills for services offered in their facility with federal funding.[22] IHS operates as part of HHS, carrying out relevant statutes and treaty obligations and providing healthcare services to eligible tribal members.[23] Throughout history, the federal government has approved statutes to create a legal obligation to provide adequate healthcare services to American Indians and Alaska Natives.[24] At the ACL Hospital alone, IHS serves approximately 126,000 patient visits each year.[25] Despite this volume of patients and longstanding service to the community, IHS is underfunded, overcrowded, unsafe, and outdated when it comes to medical equipment and facilities. [26] In their 2020 budget request, the National Congress of American Indians, a civil rights organization, stated that appropriations have never been adequate to meet patient needs and that the healthcare provided in their units is akin to “third-world conditions.”[27] The organization accused the federal government of inaction, chronically underfunding IHS facilities, and failing to uphold their legal obligations under their treaties to tribes throughout the United States.[28]
The Acoma Pueblo is not the only Native American tribe severely affected by these inadequacies during the pandemic. Local medical units in Montana similarly lacked appropriate medical resources for tribal members, requiring them to drive over an hour to the nearest IHS facility.[29] As a result, the over 500 tribes the Montana facility serves struggled with the limited resources to manage healthcare needs during the pandemic.[30] For the Navajo, the intervention of Pfizer C.E.O., Dr. Albert Bourla, and Dr. Anthony Fauci was a significant contributor to vaccine access within the reservation.[31] Both Bourla and Fauci attended town hall meetings to answer questions about the virus and the vaccine.[32] In addition, their support was crucial for decreasing vaccination hesitancy and the tribe reaching more than 88,000 vaccinations in their enrolled members.[33] In Montana, the Budget & Policy Center proposed solutions to the federal government, including allocation of CARES Act funds for the affected tribes,[34] but the federal government did not make a concrete action based on the proposal.
Before the pandemic, IHS did not provide the support required for appropriate medical services. Consequently, the pandemic only worsened IHS service. However, the Native American population in our country is small compared to other demographic groups, which should indicate a manageable population when it comes to addressing healthcare needs. That this has not been the case should be alarming, and even more so during the pandemic when their already small populations are at risk of continuing to dwindle at a faster rate. In addition to losing lives, there is a risk of losing cultures and traditions. As of 2021, Native Americans have died at twice the rate of white Americans due to the pandemic, and the elders have been the group more at risk throughout demographics.[35] Since Native traditions respect the elders as holders of language and traditions, their deaths have brought unrecoverable gaps within tribes that place these unique cultural elements at risk of being lost to history, especially with the prevalence of oral tradition throughout Native American tribes.[36]
In a conference meeting with the Indian Affairs Committee held in December 2020, the Acoma Pueblo governor shared how the pandemic affected the Tribe beyond health necessities.[37] He identified the language as the “adhesive” that keeps their culture, traditional, and religious beliefs together and helps pass them on to future generations.[38] The Indian Affairs Committee Chair, Senator Brian Schatz, urged the Committee to help with cultural preservation efforts, which suffered from the continuous deaths of tribal elders.[39] Yet, the IHS issue remained the elephant in the room when the provision of $10 million for cultural preservation was granted.[40] The usefulness of the funds is doubtful given how there is no concrete action on helping the tribes. The lack of plans of action takes away opportunity to properly spend the funds in a useful way for the tribes. The available funds can only be spent on the subject they are approved, leaving the tribes unable to allocate funds to other issues, like the healthcare shortages.
The unfortunate situation of the Acoma Pueblo during the pandemic is sadly a new episode of harm after colonization. Since their first encounter with Spanish conquistadores, the Acoma Pueblo have been subjected to violence and forced to comply with colonial rule.[41] From the invasion led by Juan de Zaldivar in 1598 that destroyed homes and the Acoma Massacre in 1599 to the trials in New Spain for resisting Spanish conquest, the Spanish forced the Acoma Pueblo to accept mistreatment by a foreign government that never had their best interests in mind.[42]
After the New Spain conquest, the Acoma Pueblo made constant complaints of abuse of power to the government in Mexico.[43] Franciscans intended to help them, and New Spain’s government allowed them to remain independent to a certain degree by allowing them to elect governors after 1620.[44] However, the Crown and the Church interfered significantly in Acoma Pueblo affairs and controlled their culture, taking away the tribe’s promised autonomy.[45] Forced to accept the Spanish language and Catholic traditions, the Acoma Pueblo established amicable relationships with the invaders on their land.[46] This compromise led to a primarily isolated existence in Sky City and the then-newly established San Estevan del Rey Mission Church.[47] The Acoma Pueblo remained on Sky City away from the Spaniard colonizers’ settlements, interacting only with the missionaries and government representatives.[48]
Once railroads and the emerging United States reached the Acoma Pueblo in the 1900s, a foreign force once again dominated the tribe and stripped them of land through the Pueblo Lands Act, forcing them to assimilate.[49] In this new scenario, the Acoma Pueblo were forced to learn English and their children placed into boarding schools and taught the Natives Protestant Christianity.[50] The change in power from New Spain to the United States left the Acoma Pueblo with similar outcomes: the diminishment of their population and land and the suppression of their culture and language. Moreover, while the country modernized, the government failed to provide the Acoma Pueblo with essential services, such as running water, sewage, and electricity.[51] We must note that while the current U.S. government forced the Acoma Pueblo to adapt to their culture and lifestyle, they kept the Acoma Pueblo at a distance from mainstream American culture and society. A third-party observer can say it is out of respect for their autonomy. However, history shows that the apathy towards Native American tribes has been prevalent throughout the country’s conquest.[52]
II. Litigation
The Acoma Pueblo, frustrated, turned to a lawsuit to seek redress for their unjust treatment during the pandemic. Litigation began after the revelation in January 2021 that IHS planned to turn the ACL hospital into an urgent care facility with limited hours and no emergency room or inpatient services beginning February 1, 2021.[53] In response to this downsizing, thirty doctors and nurses quit ahead of the announcement because they feared being fired and left unemployed.[54] This decision was the opposite of what the Acoma Pueblo wanted when they requested support from IHS. The Acoma inquired what prompted such a disadvantageous decision,[55] and IHS responded that the neighboring tribe, Pueblo of Laguna, prompted the decision to redirect ACL Hospital funding to a new clinic they intended to operate autonomously.[56]
Fed up with poor management at the ACL Hospital, the Pueblo of Laguna Tribe decided to take the matter into their own hands to better serve their community.[57] Also known as Laguna Pueblo, they are a Tribe based forty-five miles west of Albuquerque.[58] The Laguna Pueblo, exhausted by the inadequate health care provided at ACL decided to create their facility back in 2015 with approval from IHS under the Indian Self-Determination Act of 1975.[59] Since the Pueblo of Laguna funding for the ACL diminished due to the creation of the new Pueblo of Laguna clinic, the administration notified staff at ACL Hospital of impending changes.[60] Staff started leaving out of fear of layoffs, which led to further service closures like the inpatient unit.[61] The Laguna Pueblo governor, Wilfred Herrera, Jr., denounced IHS accusations that blamed the Laguna Pueblo for the budget deficit. He stated that IHS’s inability to correctly maintain and staff the facilities led to the current closing.[62] However, the ACL never informed the Laguna Pueblo that their eventual redirection for the clinic would create a budget deficit situation.[63] Otherwise, they would need to close services in the ACL facility.[64] However, attracting staff in the middle of a pandemic was not feasible due to preexisting staffing shortages and isolation in rural New Mexico.[65]
The Acoma Pueblo eventually needed to take legal action due to the lack of healthcare access. IHS skipped the one-year notice and Congressional evaluation required by the Indian Health Care Improvement Act.[66] Therefore, the Acoma Pueblo sought declaratory and injunctive relief against HHS and IHS for the closure of the ACL hospital.[67] The Acoma Pueblo claimed failure to follow the notice requirement and the determination requirement from the Indian Self-Determination and Education Assistance Act, which requires consultation and discussion with the tribe before making a drastic change like downsizing a healthcare facility.[68] On January 28, 2021, the tribe listed grievances, including specific instances of tribal members not receiving care or being turned away from the ACL Hospital in the middle of the pandemic and an acknowledgment by IHS that Native Americans require special medical attention because the pandemic affects their health at a greater rate than other groups.[69] For relief, the Tribe requested IHS to maintain the hospital’s operations at the current level of service and declare that IHS’s downsizing of the hospital violated the Acts mentioned above.[70]
In response, IHS stated that “safety concerns” warranted closure without notice, which the Indian Health Care Improvement Act otherwise requires.[71] The Acoma Pueblo challenged this defense by bringing up how this self-inflicted safety concerns should not have affected the facility to the point of drastic downsizing[72] IHS commented publicly that they strive to provide quality healthcare to Native Americans.[73] However, the agency failed to sustain these public statements, as evidenced by the lack of healthcare support to the Acoma Pueblo and other minor tribes in the area during the pandemic. Nevertheless, they could not find funding to keep the ACL Hospital open[74]
On February 1, 2021, the D.C. District Court granted the Acoma Pueblo’s request for a temporary restraining order that lasted until March 19 to prevent IHS from closing or reducing the services at the facility.[75] The outcome of the decision resulted in the ACL Hospital remaining open until February 2022; after February 2022, the facility transitioned to a federally-operated accredited ambulatory health center.[76] As of May 2021, the Acoma Pueblo’s website continued to rally for support to maintain the ACL Hospital, requesting letters to support their request.[77] By 2022, the effort stopped, showing an uncertainty and unfortunate conformity with the turn of events that appear intertwined with the tribe’s continuous unfair treatment. The lack of a successful outcome in the litigation, the halted website efforts, and the unfair treatment are all blows against the Acoma Pueblo, defeating them in a fight for fairness they should not be losing.
III. Looking Over the Issue of Funding and Possible Solutions
Given the issue of funding for healthcare access at the ACL Hospital, some of the possible solutions explored in this section include providing control to the tribe over the healthcare facility, following consultation directly with the Acoma Pueblo, and increasing funding. The pandemic placed many groups of people in precarious situations. Uncertainty over how long the pandemic would last may have led organizations and individuals to make difficult decisions, especially in the healthcare field. However, by looking closely at marginalized groups of people, we find a pattern: minorities do not have access to essential services they are entitled to and are left to their own devices. This has been the case with several Native American tribes,[78] as discussed earlier in the paper. The unprecedented times[79] argument seems to be used chiefly as an excuse by those in power to get away with minimal effort or dismiss issues that need attention. The federal government provided grants to preserve languages, which demonstrates they have funds. Federal funding’s failure to prioritize healthcare services through IHS is an unacceptable gap.
One solution is to request emergency funding to keep ACL Hospital operating at a broader level. The federal government continuously approved COVID relief packages throughout the pandemic, demonstrating an ability to fund these kinds of initiatives. However, even if tribes obtain funding, maintaining a hospital at a service level that is not humane for its patients is an inadequate solution. More than making healthcare services available, they need to be responsible and show care towards those who help fund it–the Native American Nations. These injustices, not only against the Acoma Pueblo but also to tribes in general, are disconcerting. The federal government continues to treat Native Americans as a burden through their actions and lack of care.
Moreover, this mistreatment goes beyond not respecting laws and providing adequate services. The Indian Self-Determination and Education Assistance Act touches upon the sovereignty of Native American Nations and how the government should consult tribes before effecting changes. The issue of not respecting tribes’ sovereignty has been constant throughout the decades, disrespecting tribes as sovereign groups. In the Acoma Pueblo case, the services provided through ACL are owed, at least, to the tribal members that are descendants of those who suffered more enormous atrocities throughout history.
The issue here goes beyond the hospital closure. It would have been acceptable if the government offered something else in return, such as mobile clinics, to replace the closures, but the government agency did not even provide this suggestion. The Acoma Pueblo should find their hospital open and running at its full potential, with improvements post-pandemic. In addition, the current decline in population in the state should provide incentives to its government to attract the workforce to the state.[80] Both the state and the tribes served by the ACL Hospital can collaborate to discuss the needs of workers in the area to attract the necessary talent. Incentives through governmental programs could help with this situation by funding possible incentives to attract and keep healthcare workers in the area.
The Laguna Pueblo’s actions should inspire the Acoma Pueblo to exercise their rights as a sovereign tribe. The Acoma Pueblo should take their funding back and operate the hospital for their people independently. Of course, this solution has practical problems, but should the situation be this complicated? Perhaps the Laguna Pueblo made the best decision under the circumstances, as they know better their healthcare needs and can efficiently provide services tailored to those needs. If the Acoma Pueblo follow their example, they can demonstrate that they do not need a federal agency to manage the funding they provide. Additionally, the Laguna Pueblo and Acoma Pueblo facilities should welcome smaller tribes to receive services as a display of solidarity. Smaller tribes could contribute to funding these emerging healthcare facilities, so the services become fully funded by the tribes for themselves, ideally.
On April 29, 2021, IHS agreed to keep the hospital open for another year until officials determine what resources could work for the surrounding communities, a step IHS forgot to take before they announced closure.[81] Acoma Pueblo governor, Brian Vallo, shared that it was unfortunate they needed to sue the agency to reach this negotiation step,[82] and his stance is correct; the tribe should not need to use litigation to access essential services they are entitled to. However, Governor Vallo remains optimistic, as IHS agreed to make their “best efforts” to maintain staff for operations.[83] While this course of action seems to be more respectful of the sovereignty and human dignity of the tribe, it is still not a concrete solution. The Acoma Pueblo lawyers correctly stated this unfortunate situation is another example of a transgression that takes away much-needed health care from the tribes they are supposed to serve.[84] Giving the agency another chance may be the most diplomatic response. However, if the federal government cannot provide for them, perhaps it is time for the Acoma Pueblo to be allowed more agency in addressing their needs, respecting their sovereignty in the process. A federal agency should not limit how a tribe allocates funds to address needs like basic access to health care.
[1] Tonya M. Ortiz-Louis, Pueblo of Acoma: Healthcare in a Post-COVID World, Native News Online (Dec. 1, 2020), https://nativenewsonline.net/opinion/pueblo-of-acoma-healthcare-in-a-post-covid-world.
[2] Id.
[3] Id.
[4] Barry M. Pritzker, A Native American Encyclopedia: History, Culture, and Peoples 8 (1998).
[5] Laurie J. Edwards, UXL Encyclopedia of Native American Tribes 1175 (3rd ed. 2012).
[6] Acoma Pueblo (Sky City), N.M. Tourism Dep’t, https://www.newmexico.org/places-to-visit/native-culture/acoma-sky-city/ (last visited Apr. 15, 2021).
[7] Id.
[8] Id.
[9] Deborah A. Rosen, Acoma v. Laguna and the Transition from Spanish Colonial Law to American Civil Procedure in New Mexico, 19 Law & Hist. Rev. 513, 514 (2001).
[10] Acoma Tribal Court, Pueblo of Acoma, https://www.puebloofacoma.org/departments/acoma-tribal-court/ (last visited Oct. 25, 2022).
[11] Acoma Pueblo, Census Rep. (2021), https://censusreporter.org/profiles/25200US0010R-acoma-pueblo/.
[12] David Hartzband & Feygele Jacobs, RCHN Cmty. Health Found., Population Health Approaches to Improving Rural Health (2018), https://www.rchnfoundation.org/wp-content/uploads/2018/04/Pop-Health-Approaches-to-Improving-Rural-Health.pdf.
[13] Mark Walker, Native Americans Reliant on Hospital Feel Abandoned by U.S. During Pandemic, N.Y. Times (Oct. 8, 2021), https://www.nytimes.com/2021/01/03/us/politics/indian-health-service-hospital.html.
[14] Id.
[15] Id.
[16] Id.
[17] Acoma Pueblo, supra note 11.
[18] Local and Rural Road Safety Program, U.S. Dep’t of Transp., Fed. Highway Admin. (Oct. 5, 2022), https://highways.dot.gov/safety/local-rural.
[19] Patricia C. Dischinger, Shiu M. Ho, & Joseph A. Kufera, Medical Conditions and Car Crashes, 44 Ann. Procs. Ass’n for Advancement Auto. Med. 335, 335–48 (2000).
[20] Walker, supra note 13.
[21] Id.
[22] Id.
[23] Id.
[24] Basis for Health Services, Indian Health Serv. (Jan. 2015), https://www.ihs.gov/newsroom/factsheets/basisforhealthservices/.
[25] Id.
[26] Nora Mabie, Native American Tribes Have Been Hit Harder By COVID-19. Here’s Why., Great Falls Trib.: News (Aug. 17, 2020, 3:02 PM), https://www.greatfallstribune.com/story/news/2020/08/05/why-native-americans-impacted-harder-covid-19-montana-united-states/5573737002/.
[27] Id.
[28] See id.
[29] Id.
[30] Mychael Schnell, Navajo Nation President: Disparities in Health Care System Contribute to COVID-19’s Impact on Indigenous Americans, Hill: Sunday Talk Shows (Apr. 4, 2021, 12:37 PM), https://thehill.com/homenews/sunday-talk-shows/546377-navajo-nation-president-disparities-in-health-care-system/.
[31] Id.
[32] Id.
[33] Id.
[34] Preston Parish, The Coronavirus Pandemic Demands State Investment in Indian Country, Mont. Budget & Pol’y Ctr. (June 2020),https://montanabudget.org/report/pandemic-demands-investment-indian-country.
[35] Benjamin Din, ‘Race Against Time’: Pandemic Propels Fight to Save Native American Languages, Politico: Cong. (Apr. 13, 2021, 12:55 PM), https://www.politico.com/news/2021/04/13/pandemic-native-american-languages-481081.
[36] See id.
[37] Id.
[38] Id.
[39] Id.
[40] See id.
[41] Archaeology and Legend: How Old Is Acoma?, Pueblo of Acoma, https://www.puebloofacoma.org/about-us/archaeology-and-legend/ (last visited May 6, 2021).
[42] Id.
[43] Id.
[44] Id.
[45] Pritzker, supra note 4, at 8.
[46] Id.
[47] Id.
[48] Id.
[49] Id.
[50] Id. at 8–9.
[51] Becky Pemberton, Welcome to Sky City! Tiny Settlement in New Mexico that has been Home to the Same Tribe for 800 years Still Doesn’t Have Running Water or Electricity (and is Reached by a Staircase Cut Out of Rock), Daily Mail (Mar. 29, 2016, 7:43 AM), https://www.dailymail.co.uk/travel/travel_news/article-3509559/Inside-oldest-continuously-inhabited-settlement-s-home-tribe-800-years-doesn-t-running-water-electricity.html.
[52] David S. Jones, The Persistence of American Indian Health Disparities, Am. J. Pub. Health 2122–34 (Dec. 2006).
[53] Emma Whitford, NM Tribe Sues IHS for Hospital Downsizing amid Pandemic, Law360 (Jan. 28, 2021, 6:02 PM), https://www.law360.com/articles/1349602/nm-tribe-sues-ihs-for-hospital-downsizing-amid-pandemic [hereinafter NM Tribe Sues IHS].
[54] Walker, supra note 13.
[55] Id.
[56] Id.
[57] Id.
[58] Pueblo of Laguna: Laguna, New Mexico, Nat’l Park Serv., https://www.nps.gov/nr/travel/route66/pueblo_laguna.html (last visited Oct. 25, 2022).
[59] Walker, supra note 13; see Indian Self-Determination and Education Assistance Act of 1975, Pub. L. No. 93-638, 88 Stat. 2203 (codified as amended in scattered sections of 25 U.S.C. and 42 U.S.C. § 2004b).
[60] Walker, supra note 13.
[61] Id.
[62] Id.
[63] Id.
[64] Id.
[65] Id.
[66] Complaint for Declaratory & Injunctive Relief at 2, Pueblo of Acoma v. Cochran, No. 1:21-cv-00253-BAH (D.D.C. Jan. 28, 2021) [hereinafter Complaint for Declaratory & Injunctive Relief].
[67] Id. at 3, 15–16.
[68] Id. at 14–15.
[69] Id.
[70] Id. at 15.
[71] NM Tribe Sues IHS, supra note 53.
[72] Id.
[73] Id.
[74] Id.
[75] Emma Whitford, NM Tribal Health Clinic Opens Amid Fight to Save Hospital, Law 360 (Mar. 2, 2021, 10:36 PM), https://www.law360.com/articles/1360399?scroll=1&related=1.
[76] Acoma-Canoncito-Laguna Indian Health Center, Indian Health Serv., https://www.ihs.gov/albuquerque/healthcarefacilities/acoma-canoncito-laguna-indian-health-center/ (last visited Feb. 13, 2023).
[77] Call to Action, Pueblo of Acoma, https://web.archive.org/web/20210512005242/https://www.puebloofacoma.org/.
[78] Liz Mineo, For Native Americans, COVID-19 is ‘the Worst of Both Worlds at the Same Time’, Harv. Gazette: Nat’l & World Affs. (May 8, 2020), https://news.harvard.edu/gazette/story/2020/05/the-impact-of-covid-19-on-native-american-communities/.
[79] Will Hayward, Please can We Stop Using the Word ‘Unprecedented’ to Describe Things that have Repeatedly Happened Before, WalesOnline (Apr. 22, 2020, 9:29 PM), https://www.walesonline.co.uk/news/news-opinion/coronavirus-unprecedented-government-covid-excuses-18130261.
[80] Morgan Lee, Study Says Future of New Mexico May Include Fewer People, AP News (Apr. 29, 2021), https://apnews.com/article/nm-state-wire-new-mexico-health-coronavirus-census-2020-245e6a215c1e45f5463beb5c7b7604f7; New Mexico to Encourage Unemployed to Return to Work, AP News (Apr. 29, 2021), https://apnews.com/article/michelle-lujan-grisham-new-mexico-health-coronavirus-business-5685db85c32b9c3b6bef31658827e55d.
[81] Susan Montoya Bryan, New Mexico Tribe, US Agency Reach Agreement over Hospital, AP News (Apr. 29, 2021), https://apnews.com/article/new-mexico-coronavirus-government-and-politics-health-03f911b80bf8b9756fa0a5c215701a72.
[82] Id.
[83] Id.
[84] See generally Complaint for Declaratory & Injunctive Relief, supra note 66.
Abstract
The legal marijuana industry in the United States is rapidly developing, but there is little consensus or uniformity among state tax structuresfor marijuana. This Essay argues that states should adopt a weight and potency hybrid system for taxing recreational marijuana. It provides background into “vice taxes” and the unique considerations and potential goals of a marijuana tax. It then outlines the various forms excise taxes on recreational marijuana could take, the various recreational marijuana tax schemes, and the benefits of each system, as discussed by scholars. This Essay concludes with a discussion of the taxes states have already implemented on recreational marijuana and an explanation for why a weight and potency hybrid system would be a more equitable option until there are further developments in the field.
Keywords: marijuana law tax, recreational marijuana, equitable considerations
Table of Contents
Introduction
I. Types of Taxes: Sales and Excise Taxes
II. Issues with Taxing Marijuana
III. Goals of Taxing Marijuana
IV. Taxing Medical Marijuana
A. Sales Tax
B. Excise Tax
V. An Analysis of the Potential Forms of Excise Taxes
A. Price-Based Taxes
B. Weight-Based Taxes
C. Potency-Based Taxes
D. Manufacturer-Directed Tax
VI. Potential Solutions and Considerations
A. Proposed Solutions
B. Considerations
VII. Current State Models
VIII. Policy Recommendations
A. The Ideal Excise Tax
B. Recommendations for Future Research
Introduction
The legal marijuana industry in the United States is rapidly developing. As of October 2022, thirty-seven states and four U.S. territories have legalized marijuana for medical usage.[1] Furthermore, nineteen states (as well as Guam and D.C.) have legalized the recreational use of marijuana.[2] States have the power to decide if and how to tax marijuana at both the medicinal and recreational levels. This Essay argues for a weight and potency hybrid system for taxing recreational marijuana as the most equitable option based on the current technology and knowledge available.
The issue at hand is incredibly complex, with a variety of factors for determining which system is the “best.” The nuances of and various angles from which to examine the question make it near impossible to determine one correct solution. This Essay offers a small glimpse into the vast field of taxation and other possibilities for taxing marijuana, such as wholesale versus resale taxes. It aims to analyze potential tax schemes based on how equitably and feasibly they can be implemented by states given the current state of technology and the market.
Because the topic of taxing marijuana is so broad and complex, the scope of this Essay is limited in several ways. For instance, it does not contemplate the effect of federal legalization or the possibility of federal taxes on marijuana. Additionally, it does not examine the supplemental, local taxes localities and municipalities are often allowed to levy by their respective states.[3] Another limitation of this Essay is its focus on scholarly research and theories in place of considering more practical influences like the grey market of home growing or marijuana tourism. Lastly, the legal marijuana industry is in its infancy and rapidly developing. As a result, much of this Essay is based on educated speculation and predictions. There is little insight into how taxation will affect externalities and revenue in the long term since marijuana was only legalized recreationally in the past six years.[4]
The Essay begins by outlining the types of taxes typically levied on vices, the particular set of issues implicated in taxing marijuana specifically, and the potential goals of a marijuana tax. It then gives an overview of the various forms excise taxes on recreational marijuana could take and the various recreational marijuana tax schemes and considerations scholars have proposed. Lastly, it discusses what taxes states have implemented on recreational marijuana before explaining why a weight and potency hybrid system is the current ideal.
I. Types of Taxes: Sales and Excise Taxes
In taxing a product such as marijuana, there are mainly two types of tax options: sales taxes and excise taxes. Sales taxes are the typical taxes applied to everyday purchases and services.[5] The tax is calculated by multiplying the cost of the good or service by the stipulated tax rate.[6] Theoretically, sales taxes apply to all retail transactions, but in practice, they are more complex with exemptions for specific items and different rates for different types of purchases.[7]
Excise taxes are levied on the manufacturing, sale, and/or consumption of a few specific products.[8] The most common examples of excise taxes are those on tobacco and alcoholic products.[9] Usually, excise taxes are used as “sin” (aka Pigouvian) taxes meant to offset the negative externalities associated with consuming these products;[10] mainly by disincentivizing consumption. These taxes factor the “external cost”—what a private person using the “sinful” product costs (economically speaking) the public—into the product’s internal price for the consumer.[11] By increasing the price of marijuana, the excise tax is theoretically decreasing demand, thereby lowering marijuana usage and the associated externalities.[12] Excise taxes do not work well as tools solely intended for revenue production because they are typically focused on a narrow product or industry and thus are unstable sources of revenue. Additionally, they usually have regressive tax burdens.[13] Therefore, excise taxes should mainly be used to capture a negative externality —not to raise revenue.[14]
The question then becomes whether either or both of these taxes are appropriate for purchases of marijuana. Most policy and tax experts agree that sales taxes are appropriate for recreational marijuana. Because sale taxes are meant to be applied to most, if not all, retail transactions, logically it follows that most marijuana purchases should have a sales tax applied.[15] In fact, in 2020, only one recreationally legal state with a sales tax did not levy its general sales tax on recreational marijuana.[16]
The greater question is whether and how to apply an excise tax to recreational marijuana; that is, whether marijuana has a societal cost that justifies an extra tax. Like alcohol and tobacco, marijuana is a vice and regulated substance the government has an interest in decreasing; therefore, the purchase of marijuana should warrant an excise tax. Since most states already have an infrastructure for general sales tax, which they apply to marijuana, this Essay focuses on the different forms of excise taxes and the potential ways they could be implemented by states.
II. Issues with Taxing Marijuana
Marijuana’s unique characteristics make it hard to create an appropriate and effective tax scheme. First, marijuana comes in many different forms: it can be smoked or vaporized in its flower form, “dabbed” as an oil or wax, infused into edibles, or taken orally as a tincture or capsule—just to name a few of the most popular delivery methods.[17] Because of this variety, applying one uniform rule can be difficult.
Second, the external social costs of marijuana consumption are difficult to identify and even more difficult to quantify.[18] Every excise tax requires consideration of the cost of externalities. However, marijuana’s externalities are especially challenging to calculate because there have been no studies on them (as of 2020), and they can be impacted by substitution.[19] This is likely to remain true as long as the federal government continues to classify marijuana as a Schedule I drug, strongly limiting research on the drug.[20] The limited research that does exist provides only speculative information regarding the drug’s negative externalities. For instance, health concerns are often cited as a key risk of marijuana usage, yet scientists are still unclear on the associated health risks of marijuana usage.[21] Experts have suggested other externalities that are more clearly societal, such as adolescent marijuana usage,[22] secondhand smoke, and driving impairment.[23] However, there is still not enough research to show proof of or the extent of these social costs.[24]
Ultimately, it is still unclear how the various elements of marijuana interact with the human body and to what capacity marijuana usage harms the public. Until the negative externalities can be reliably determined, it will be difficult to appropriately set excise tax rates on recreational marijuana. As a result, some experts recommend using Tetrahydrocannabinol (THC) content as a proxy for the external costs of marijuana consumption until more research can be done.
Third, illicit marijuana is more accessible than illicit tobacco or alcohol.[25] As a result, a tax scheme would need to factor in the black market and make sure prices are low enough to minimize illegal purchases.[26] Fourth, and finally, the marijuana industry is incredibly new and bound to evolve.[27] Any tax scheme implemented now needs to be adaptable to future changes and developments in the industry, and the industry should be monitored for significant changes that warrant a change in tax law.
In addition to marijuana-specific challenges, there are problems that any new tax law will inevitably face. As Pat Oglesby, former chief tax counsel of the U.S. Senate Finance Committee, stated: “The amount of tax to levy is a value judgment—there is no clear ‘right’ tax burden.”[28] He cautioned that “[t]echnical errors and drafting blunders will complicate the work.”[29] When creating tax schemes for recreational marijuana, legislators should take extra caution given the contention and demand around the product —both of which exacerbate the need for care and increase the magnitude of potential grievances.
III. Goals of Taxing Marijuana
Any marijuana tax scheme must also be evaluated, at least in part, by its goals. The most apparent purpose for an excise tax would be to discourage use and offset associated negative externalities and social costs.[30] Other potential goals include decreasing black market purchases and raising revenue for the government.[31] Additionally, an excise tax on marijuana needs to straddle the line between being high enough to offset social costs while not driving people to a black market.[32] These goals can conflict as decreasing consumption also decreases the revenue that a state can obtain through the tax.
States may weigh these goals differently and prioritize the objectives each feels are most salient. “Sin taxes” are used to encourage a reduction in consumption to lower societal costs, like gasoline taxes; encourage consumption in moderation, such as with alcohol; or discourage consumption completely, as with cigarettes. Most states will likely take the first or third approach, depending on their views on marijuana. States that reluctantly legalized åmarijuana will likely want to reduce consumption, while states seeking to raise revenue from this specific market will encourage consumption tempered with caution. It is unlikely that any state which has legalized recreational marijuana will want to completely discourage consumption unless legalization happens against the legislature’s will;[33] and even then, pushing consumers to the black market is a risk the legislators are not likely to take. Ultimately, the objectives behind a marijuana tax will be individual and subjective based on state goals.
IV. Taxing Medical Marijuana
Taxing medical marijuana raises a separate question: mainly, whether it should be subject to tax at all because it is a medicine. Currently, there is a broad range in how states tax medical marijuana from no taxes at all to different combinations of sales and excise taxes.[34]
A. Sales Tax
Generally, prescription drugs are exempted from sales tax, while non-prescription drugs are not.[35] Therefore, whether medical marijuana should be subject to sales tax turns on whether it is better classified as a prescription or non-prescription drug. Richard Phillips, a senior tax analyst for the Senate Budget Committee, suggests that medical marijuana is best considered a non-prescription drug since it lacks Food and Drug Administration (FDA) approval, and thus, doctors cannot formally prescribe it.[36] According to Phillips, regular sales tax should apply to medical marijuana until the FDA approves it.[37]
The key reason the FDA cannot or will not approve medical marijuana—thus prohibiting doctors from prescribing it—is that marijuana is still classified as a Schedule 1 drug under the Controlled Substance Act.[38] The Drug Enforcement Administration (DEA) and other federal agencies have consistently refused to recategorize marijuana to a lower schedule arguing there is insufficient evidence to show a potential medical benefit.[39] Ironically, this lack of evidence is likely because marijuana’s Schedule 1 classification heavily limits the research that could legally be conducted on potential medical benefits of marijuana.[40] There are also political and racial motivations for marijuana’s categorization which could explain why the government refuses to reschedule the drug despite the solid scientific evidence in favor of the medical benefits of marijuana.[41] About these motivations, John Ehrlichman, Assistant for Domestic Affairs to President Richard Nixon, the President who declared the “war on drugs”, stated:
You want to know what this was really all about. . . . The Nixon campaign in 1968, and the Nixon White House after that, had two enemies: the antiwar left and black people…. We knew we couldn’t make it illegal to be either against the war or black, but by getting the public to associate the hippies with marijuana and blacks with heroin, and then criminalizing both heavily, we could disrupt those communities. We could arrest their leaders, raid their homes, break up their meetings, and vilify them night after night on the evening news. Did we know we were lying about the drugs? Of course we did.[42]
While this campaign started nearly 60 years ago, the ACLU has found that “[t]he [wa]r on [m]arijuana [r]ages on” with over 6.1 million arrests for marijuana occurring between 2010 and 2018—making up more than 43% of all drug arrests.[43] More importantly, “a Black person is 3.64 times more likely to be arrested for marijuana possession than a white person, even though Black and white people use marijuana at similar rates” regardless of state, socioeconomic class, size of county, and size of Black population.[44]
Although doctors cannot formally prescribe medical marijuana, patients also cannot simply purchase it as an over-the-counter drug. A patient in a recreationally legal state could indeed go to a recreational dispensary to purchase marijuana; however, they would not be able to get medical-grade products or any medical tax benefits without proof of their medical status. In every state that legalizes medical marijuana, a patient cannot obtain medical marijuana without a recommendation or certification from a medical professional.[45] The patient must register with the state, submit the physician’s certification, and confirm they have a qualifying medical condition before receiving an ID card asserting their status as a medical patient entitled to the accompanying benefits.[46] The entire system in place is akin to—if not more rigorous than—attaining a typical medicinal prescription from a doctor.
Therefore, it makes sense to exempt medical marijuana from sales tax even though the FDA has yet to approve it. Most states that have legalized recreational marijuana do not subject medical marijuana to the sales tax levied on recreational marijuana. Eight out of the eighteen states do not tax medical marijuana in any capacity, sales tax or otherwise.[47]
B. Excise Tax
In contrast, excise taxes are not applied to every transaction and are intended to discourage use and offset negative societal costs.[48] With medical marijuana, there is a health benefit to patients, so there is not a societal interest indiscouraging use.[49] Moreover, “[w]hile recreational marijuana shares negative externalities (secondhand smoke, driving under the influence, health impacts) with other ‘sinful’ products like tobacco and alcohol, medical marijuana would, by definition, not be viewed the same way when recommended as a treatment for medical conditions.”[50] These other products do not have the same medicinal benefits that possibly negate the need to capture externalities.
On the other hand, there is a substantial concern that people will turn to medical marijuana and seek doctors’ notes as a means to escape the excise taxes on recreational marijuana.[51] As Oglesby contends, “[n]o tax would be evaded by a claim of bodily pain that, as a practical matter, is both unprovable and irrefutable.”[52] Those with this opinion look at Colorado as an example of this same worry coming to life.[53] Two months after Colorado legalized marijuana, 70% of sales were by medical patients who did not pay excise taxes.[54] Oglesby’s commentary on this occurrence highlights the skepticism medical marijuana faces: “That’s a lot of sick people.”[55]
Two tax policy experts have proposed solutions for handling the potential abuse of medical marijuana. First, Phillips suggests that states with more restrictive requirements for a doctor’s note would have a better chance at limiting the number of people that do not need medical marijuana taking advantage of it.[56] Some states have imposed restrictions such as limiting the conditions that qualify for a doctor’s note or the quantities or forms of marijuana that can be dispensed to medical patients.[57]
Alternatively, Oglesby recommends taxing everyone equally regardless of whether they are medical marijuana patients or recreational users.[58] He believes that simplicity should be favored over fairness.[59] However, Oglesby acquiesces that if the medical components of marijuana could eventually be isolated and prescribed separately, reevaluating the tax scheme would make sense.[60]
While these concerns over abuse of medical status are valid, applying the total excise tax to medical marijuana would negate the purpose of an excise tax to offset negative externalities. Better systems for qualifying for medical marijuana should be further researched, but a tax scheme needs to be in place until then. Because of the strong potential for abuse, medical marijuana should still be subject to some type of tax, but at a lower rate than that at which recreational marijuana is taxed. It is important to ensure that patients have access to medicine without the high barrier an excise tax can create—especially since the purpose of an excise tax is not fulfilled in taxing medical marijuana. There are already several states implementing some form of this suggestion that can serve as models.[61]
V. An Analysis of the Potential Forms of Excise Taxes
Applying an excise tax to marijuana is not as simple as it might seem. There are several types of taxes that states can theoretically implement at various stages of the retail process, from manufacturing to distribution to consumer sales. This Essay will primarily focus on consumer-level taxes since they are the most visible and widely discussed but will briefly touch on taxes higher up on the distribution chain. Specifically, this Essay will discuss price-based taxes, weight-based taxes, potency-based taxes, and manufacturer-directed taxes.
A. Price-Based Taxes
Price-based taxes, also known as ad valorem taxes, are the most common form of marijuana excise taxes.[62] A price-based tax is calculated as a percentage of the sales price.[63] Consequently, a price-based tax is the simplest way to tax marijuana.[64] This simplicity likely explains the popularity of ad valorem taxes.
In addition to simplicity, there are other benefits to using a price-based tax. First, the tax will capture the same share of spending on marijuana even as the price changes.[65] Second, the tax will likely be correlated to potency because higher potency items are theoretically more expensive than lower potency items.[66]
Nevertheless, there are also several disadvantages to using a price-based excise tax. First, a “drop in marijuana prices would dramatically erode the revenue that a value-based tax can raise.”[67] As the marijuana industry becomes more efficient, it is predicted that the price will level out, as most markets do.[68] Colorado is a prime example of a state where this price drop is already occurring, so the concern is genuine and imminent.[69] While revenue-raising is not a central goal excise taxes, it is interconnected to the goals of keeping the price high enough to discourage and compensate for the social cost of marijuana use. Second, the ad valorem model does not account for the tax principle that “[a] product with similar qualities and in similar quantities should have equal tax liability regardless of design or price.”[70] Meaning, the THC level in a product should be the focus of the tax, regardless of whether it comes in a fancier form or a more expensive brand.
Third, consumers are potentially harmed by this system because a price-based tax incentivizes consumers to choose cheaper alternatives, which, in turn, encourages manufacturers to lower costs, oftentimes by sacrificing product quality.[71] Moreover, this “downtrading,” or consumers choosing cheaper products, trend does not relate to any externality the tax is trying to capture, so the excise tax is not most directly related to its purpose.[72] Fourth, price-based taxes often result in tax pyramiding where a “wholesale tax is built into the retail selling price on which the retail tax is based, resulting in a tax on a tax.”[73] Essentially, manufacturers and retailers factor the costs of the taxes directed at them into the consumers’ retail price. This tax pyramiding leads to consumers bearing the brunt of the taxes despite not being the intended target. All of these disadvantages raise concerns over the equity of an ad valorem tax.
B. Weight-Based Taxes
An alternative to a price-based tax is a weight-based tax. This tax is also known as specific taxation,[74] or per-unit taxation.[75] As the name implies, this tax is levied at a specific cost per item or unit[76] or calculated by volume.[77] A per-unit tax is generally the most common excise tax type.[78] For example, cigarettes are taxed at a flat rate per pack,[79] and gasoline is taxed in cents per gallon.[80] In taxing marijuana, the per-unit or specific tax would most logically be weight-based.[81]
There are a few key benefits of a weight-based system for taxing marijuana. To start, the tax is relatively stable and not likely to be affected if the predicted price drop of marijuana occurs.[82] The amount collected remains the same per product (of the same weight and category) without regard to brand or price.[83] This blindness to cost might make the excise tax, whose purpose is to capture the externalities of consumption, more equitable. Moreover, a weight-based tax may counterbalance any price drop by establishing a minimum selling price at the retail level.[84] Lastly, an artificial market valuation of marijuana—such as retail price—would not be required to implement this form of taxation.[85]
Despite the advantages of a weight-based tax system, there are still significant drawbacks to consider. Namely, “[a] flat, weight-based marijuana tax may inadvertently incentivize producers to cultivate stronger marijuana because it would have a higher sale price, yet still only be subject to the same per-unit tax as lower potency marijuana.”[86] Similarly, a weight-based tax can end up being regressive since consumers pay the same taxes regardless of the quality and cost of the product.[87] Furthermore, because marijuana comes in many forms that are not analogous by weight (for instance one gram of flower is very different than a gram of concentrated THC oil), it is “untenable” to have a flat, weight-based tax.[88] Consequently, a more complex system would be needed with multiple weight categories similar to what legislatures already use for taxing alcohol and tobacco.[89] Other considerations also need to be factored in, such as the weight discrepancies between fresh and dried flowers and effects of new preservation and extraction techniques such as flash freezing,[90] which removes water weight from flower and significantly increases the volume to weight ratio.[91]
As a result, most weight-based taxes are levied on the plant material and not the final product, which excludes externalities associated with the product’s final form.[92] Specific forms of marijuana might have higher externalities that legislators (or society) would want to capture. For example, edibles are more easily consumed and take longer to metabolize, which can lead to consumers taking higher doses of THC than they anticipated or desired. Journalist Maureen Dowd famously highlighted this issue in her New York Times article discussing her distressing experience with THC-infused chocolate.[93] A weight-based tax system would not account for this externality without extreme difficulty because it would need to be a complex system with different classes that would each be taxed differently to incorporate the many end forms of marijuana. Lastly, a weight-based tax is not dynamic, so while it will not decrease as price drops, it likely will not increase continuously either.[94]
C. Potency-Based Taxes
The last type of consumer-directed excise taxes is a potency-based tax. Under this kind of system, the excise tax would be directly related to the THC levels in the product, with higher levels of THC taxed at a higher rate.[95] As of 2020, Illinois was the only state to incorporate potency in its marijuana tax scheme.[96] Since then, Connecticut and New York have legalized recreational marijuana and enacted potency-based excise taxes on the consumer and wholesale levels respectively.[97]
The key benefit of a potency-based tax is that THC consumption is likely the best way to account for the negative externalities the excise tax aims to capture.[98] Additionally, a potency-based tax encourages consumers to purchase and consume less-potent products.[99] This incentive may decrease societal costs of THC consumption and discourages heavy use. Finally, because a potency-based tax more completely captures negative externalities in comparison to the other methods of taxation, it is the most equitable solution.[100]
As with all tax options, there are downsides to a potency-based tax system as well. A potency-based tax would likely be the most complex system to implement.[101] For example, reliably testing the product’s potency is a significant issue. Currently, the results of potency tests are heavily dependent on which lab conducts the test.[102] Also, there is the difficulty of measuring marijuana potency in its various forms. The most straightforward way to test potency might be measuring concentrates or other derivatives of marijuana, but marijuana is not only sold in this form.[103] However, measuring the THC in dried plants is more complicated than measuring it in derivative forms and unprecedented in tax schemes for nicotine and tobacco.[104] Additionally, which cannabinoids should be measured is unclear because cannabinoids besides THC may play a role in potency and inhibition.[105] Lastly, while revenue from a potency-based tax will remain stable if there is a price drop, it will not increase either to counterbalance the price drop and is therefore not dynamic.[106]
D. Manufacturer-Directed Tax
The last option this Essay discusses is taxing manufacturers instead of consumers. Oglesby suggests this tax base is one of the most feasible options in addition to weight, potency, and price schemes.[107] Specifically, he suggests that manufacturers could be taxed by square footage of their operations or by the number of cultivated plants.[108] One benefit of this tax is that there is little risk of pretax leakage, (i.e. taxes being evaded or uncollected) because the tax is implemented at the head of the supply chain.[109] Additionally, this tax structure is much simpler and “requires little lead time to implement” in contrast to weight or potency-based tax.[110] However, manufacturer-directed taxes have drawbacks as illustrated by California’s implementation of a cultivation tax per square foot of cultivation.[111] California localities levy the tax through gross tax receipts, which results in tax pyramiding as the tax cost is continuously passed on to each stage of the retail process.[112] While this tax might be more logistically straightforward than some other forms, it must be implemented carefully to avoid tax pyramiding.
VI. Potential Solutions and Considerations
There are three chief solutions scholars endorse as effective tax systems for recreational marijuana: a potency-based system, a weight-based system, and a combination of the two. Scholars also offer considerations states should take into account when devising their tax systems on marijuana.
A. Proposed Solutions
The first solution is a potency-only test. Ulrik Boesen, a senior policy analyst at The Tax Foundation, suggests this system is the best short-term solution.[113] His recommendation explicitly “[d]isregard[es] the issues surrounding testing”[114]—a fairly large oversight given the current technological limitations.[115] Boesen recommends a potency system based on THC content alone until further research is done.[116] He posits that a potency-based system is the best way to capture the negative externalities of recreational marijuana usage.[117] To best implement this tax scheme, Boesen offers three pieces of guidance: 1) reconsider the taxation categories as the market develops and new research emerges on how to best capture the externalities, 2) factor into the tax code the harm caused by the delivery method of marijuana consumption, and 3) consider levying the tax on the wholesale level to avoid tax pyramiding while also decreasing the number of taxpayers the government has to deal with.[118]
Nonetheless, some scholars deem a potency-based tax system impractical because of the current technological limitations on testing the potency of marijuana products.[119] Unprocessed marijuana may never have a reliable test for potency, similar to the issue of measuring nicotine in cigarettes.[120] If testing cannot be done reliably and in a manner accessible to manufacturers, a solely potency-based tax system is unrealistic. Such a tax would be inequitable and would not correctly capture the externalities an excise tax aims to collect.
Alternatively, a tax system based primarily on weight is proposed in a report from the Institute on Taxation and Economic Policy (ITEP) written by Carl Davis, Misha Hill, and Richard Phillips. ITEP concludes that a weight-based excise tax on recreational marijuana makes the most sense for the long-term because of its purported stability.[121] They believe ad valorem taxes are too unstable because of the projected price drop,[122] and a potency-based tax is problematic because testing is currently too unreliable.[123] In order to obtain the most revenue, ITEP suggests indexing the tax to grow alongside inflation each year to maintain the tax’s value over time.[124] ITEP acknowledges that their favored system would not account for potency, but suggests that states may account for potency by setting different tax rates for the various categories of products and potencies.[125]
ITEP’s proposal leads to scholars’ third tax scheme suggestion—a hybrid of potency and weight-bases. The simplest way to implement this system could be to model it after the way legislatures currently tax alcohol, where liquor is taxed at a higher rate per gallon than wine and beer, which have lower alcohol content.[126] Boesen posits that “[b]y introducing THC intervals in a similar style to alcohol intervals, testing may be easier as the acceptable margin of error is larger. This could be done by taxing the plant materials according to weight, but at different rates according to THC content.”[127] He acquiesces such a system has the potential to distort the market due to resulting tax cliffs but still believes factoring in potency is “the most equitable and realistic option at this point.”[128] Eventually, each category’s tax brackets could become more linear as the reliability of potency tests improve.[129]
Importantly, most scholars heavily discourage a solely ad valorem excise tax.[130] Boesen cautions explicitly that“[t]o best tax marijuana products equitably and stably, policymakers should stay away from ad valorem taxes despite their simplicity.”[131] Because legalized recreational marijuana is still fairly new in the United States, the accuracy of Boesen’s prediction remains unknown. While states that have implemented ad valorem excise taxes on recreational marijuana have seen an increase in revenue each year, the rate of revenue growth for the more senior states seems to be slowing down.[132] If a state insists on a price-based tax, ITEP suggests implementing it alongside a weight-based tax to increase the tax’s stability for the long run.[133] ITEP highlights Maine’s system[134] where consumers pay a price-based excise tax while manufacturers pay a weight-based tax as an example of this model.[135]
B. Considerations
Scholars also offer a few essential considerations for designing a tax scheme for recreational marijuana. First, states should contemplate slowly implementing the tax as the marijuana market grows.[136] Doing so will help the legal market compete with the black market and acclimate consumers to shopping legally so they will not be deterred by the taxes as they eventually increase.[137] States should balance this interest with the fact that lower prices can lead to more consumption, which will increase societal costs. Additionally, states need to balance fighting the black market with constituent satisfaction since constituents tend to be unhappy with tax increases.[138] Second, states might consider using the excise tax as a means to create a price floor.[139] Phillips illustrates what this may look like: “For example, if the pretax price of retail marijuana falls to $60 per ounce, but state lawmakers want to ensure that marijuana is never cheaper than $100 an ounce, the state could require that the total tax collected at the cash register be the greater of the statutory tax rate, or the tax rate needed to raise the final price to $100 ($40 in this case).”[140] Third, state constitution construction may make amending a tax law once it is on the books difficult; therefore, states should give much thought and deliberation to the long-term ramifications of their tax design for recreational marijuana.[141] While choosing the most straightforward scheme (likely ad valorem) as a placeholder until the industry develops may be tempting, states could get stuck with their chosen tax model for longer than they anticipate.
VII. Current State Models
While theoretical conjectures and proposals are helpful, analyzing what is really happening in the world is critical. Currently, only two recreationally legal states do not have an excise tax for recreational marijuana at the retail level—Alaska and New Jersey.[142] Both opted only to have an excise tax at the wholesale level.[143] Of the remaining seventeen[144] states, fifteen implemented a solely ad valorem tax at the retail level with rates ranging from 8-37%.[145]Interestingly, New Mexico chose to phase in its tax rate with gradual, annual increases until 2030.[146] New Mexico’s policy will serve as an exciting case study in the future to see if scholars were correct in suggesting states implement such an approach.
Illinois and Connecticut both employ systems more aligned with scholarly proposals. Illinois has a tax scheme for recreational marijuana based on both potency and sales price.[147] Taxes on recreational marijuana in Illinois are as follows:
Any cannabis, other than a cannabis-infused product, with an adjusted delta-9-tetrahydrocannabinol level at or below 35% shall be taxed at a rate of 10% of the purchase price;
Any cannabis, other than a cannabis-infused product, with an adjusted delta-9-tetrahydrocannabinol level above 35% shall be taxed at a rate of 25% of the purchase price; and
A cannabis-infused product shall be taxed at a rate of 20% of the purchase price.[148]
These tax rates are among the highest in any state. A reasonable inference is that Illinois might be trying to disincentive citizens from purchasing high-potency marijuana products.
Comparatively, Connecticut’s tax system for recreational marijuana combines both weight and potency.[149] In Connecticut, recreational marijuana is taxed at a rate of $0.00625/mg THC for flower; $0.0275/mg THC for edibles; and $0.009/mg THC for other products.[150]
This data shows most states choose to implement ad valorem systems despite the concerns tax and policy analysts have regarding those schemes. While the reasons why states are so drawn to this model is unclear without further research, one can presume scholars are likely correct in saying states would be attracted to the simplicity of ad valoremtaxes and the ease of implementation. Time will tell whether scholars are correct about the long-term instability of ad valorem taxes on recreational marijuana. The different models each state has chosen should be studied as the legal marijuana industry levels out, to see which system(s) captures the most negative externalities and produces the most revenue in the long term.
VIII. Policy Recommendations
A. The Ideal Excise Tax
Out of the three proposed options for an excise tax on marijuana, a weight and potency hybrid system is currently the ideal choice. This system captures externalities more equitably than a solely potency-based tax. Processed products, such as extracts and edibles, could be taxed in brackets by potency, while unprocessed marijuana, which cannot currently be reliably tested for potency, could be taxed by weight. This way, the different types of marijuana would be taxed based on their characteristics and the current testing limitations.
Additionally, by not relying solely on weight and incorporating potency, this system discourages heavy consumption and discourages consumers from purchasing products with higher THC concentrations. Third, this tax scheme would remain stable throughout the marijuana market’s leveling out process and subsequent price drop. If a state government is concerned about raising revenue, it will not want tax revenue to decrease drastically over time. While this system might be more difficult for states to set up, the complexity will ensure longevity and satisfied objectives. Since amending tax laws once they are on the books is hard, states should invest time and thought now into implementing the most ideal system possible the first time around.
B. Recommendations for Future Research
The most obvious place to continue research on effective recreationally marijuana tax schemes is to conduct case studies on each state’s tax system in upcoming years. This research should look beyond revenue and measure the societal costs and negative externalities accounted for by the tax to quantify each system’s true success. Additionally, research in this field will benefit from controlling for factors not directly related to the marijuana tax that may affect an individual state’s results. New Mexico, in particular, should be studied as an example of how phasing in the total tax rate actually affects marijuana sales in the black market.
Another critical area of research is each state’s objective(s) in choosing and levying its tax system. States need to weigh revenue-raising, reduction of marijuana consumption, and elimination of the black market, among other considerations, when designing their system. States are likely to prioritize these considerations differently based on their unique needs and concerns. States’ legislative intent can provide insight into which considerations were factored into their decisions. Ideally this will provide a greater understanding as to the practicalities of devising a tax system for recreational marijuana. Lastly, analyzing how a federal tax or legalization might affect the discussion of the ideal tax model would be prudent as well.
Pat Oglesby suggests a government monopoly might be the best method for the distribution of marijuana.[151] If the federal government ever implemented such a system, states would need to reconsider their entire tax models for marijuana. Ultimately, there are still many gaps in the research on taxing legalized marijuana, and hopefully, researchers and scholars to come will continue the conversation.
[1] State Medical Cannabis Laws, Nat’l Conf. of State Legislatures (Sept. 12, 2022), https://www.ncsl.org/research/health/state-medical-marijuana-laws.aspx.
[2] Claire Hansen, Horus Alas, & Elliott Davis Jr., Where Is Marijuana Legal? A Guide to Marijuana Legalization, U.S. News & World Rep. (Oct. 14, 2021, 2:24 PM), https://www.usnews.com/news/best-states/articles/where-is-marijuana-legal-a-guide-to-marijuana-legalization.
[3] Benjamin Hansen, Keaton Miller, Boyoung Seo, & Caroline Weber, Taxing the Potency of Sin Goods: Evidence from Recreational Cannabis and Liquor Markets, 73 Nat’l Tax J. 511, 516 (2020).
[4] Ulrik Boesen, A Road Map to Recreational Marijuana Taxation, Tax Found. 1, 2 (June 2020) [hereinafter A Road Map]. Colorado was the first state to legalize the sale of recreational marijuana in 2014. Id. The author speculates that the market will continue to expand in the years following the writing of this Essay.
[5] Inst. on Tax’n & Econ. Pol’y, How Sales and Excise Taxes Work 1 (Aug. 2011), https://leg.mt.gov/content/Committees/Interim/2019-2020/Revenue/Meetings/July-2020/HJ-35/ITEP-How-Sales-and-Excise-Taxes-Work.pdf.
[6] Id.
[7] Id.
[8] What Is an Excise Tax?, Tax Found., https://taxfoundation.org/tax-basics/excise-tax/ (last visited Nov. 18, 2021).
[9] Inst. on Tax’n & Econ. Pol’y, supra note 5, at 2.
[10] What Is an Excise Tax?, supra note 8 (“Excise taxes can be employed as Pigouvian taxes, or sin taxes, to price in externalities. An externality, in economics terms, is the side effect or consequence of an activity that is not reflected in the cost of said activity.”).
[11] Benjamin M. Leff, Marijuana Taxation: Theory and Practice, 101 B.U. L. Rev. 915, 920–21 (2021).
[12] Id. at 919.
[13] Ulrik Boesen, Excise Tax Application and Trends, Tax Found. 1, 2 (Mar. 2021).
[14] A Road Map, supra note 4, at 2, 22.
[15] For a discussion of sales tax and medical marijuana, see infra subpart II.A.
[16] A Road Map, supra note 4, at 7 (The one state with a general sales tax is not levied on marijuana is Colorado).
[17] Douglas A. Berman & Alex Kreit, Marijuana Law and Policy 9–11 (2020).
[18] A Road Map, supra note 4, at 22.
[19] Id.
[20] The Schedule I classification “functionally serves to preclude large-scale scientific research in the United States.” Researchers wishing to study marijuana must apply to the DEA and FDA, and if approved, they can only conduct research on marijuana grown in the singular federal facility created for this purpose. Berman & Kreit, supra note 17, at 422.
[21] Hansen, Miller, Seo, & Weber, supra note 3, at 518 (stating that while long-term marijuana consumption has been linked to “liver, lung, and cardiovascular disease and . . . an increased risk of mental illnesses,” scientists have not been able to find a causal relationship between marijuana usage and these health conditions.) Studies also conflict about what harm marijuana use causes while pregnant. See Chia-Shan Wu, Christopher P. Jew, & Hui-Chen Lu, Lasting Impacts of Prenatal Cannabis Exposure and the Role of Endogenous Cannabinoids in the Developing Brain, 6 Future Neurology 459, 461 (2011) (claiming that the two foundational studies on prenatal exposure did not find a correlation between marijuana exposure and miscarriages and finding that the data and studies linking some other reported harms to prenatal marijuana exposure were “weak” or irreplicable), and Hansen, Miller, Seo, & Weber, supra note 3, at 518 (citing a study that claims fetal marijuana exposure is correlated to miscarriages).
[22] Leff, supra note 11, at 925–26.
[23] A Road Map, supra note 4, at 2.
[24] See Hansen, Miller, Seo, & Weber, supra note 3, at 517 (explaining that one study found marijuana impaired driving performance, but researchers from another study could not show that marijuana usage actually caused more traffic fatalities when analyzing data from two legal states).
[25] Pat Oglesby, States May Be Stuck with Second-Best Marijuana Taxes, 72 State Tax Notes 539, 539 (2014) [hereinafter States May Be Stuck].
[26] Id.
[27] Pat Oglesby, Marijuana Taxes — Present and Future Traps, 83 Tax Notes 391, 392 (2017) [hereinafter Marijuana Taxes].
[28] Id.
[29] Id.
[30] Id.; Richard Phillips, Inst. on Tax’n & Econ. Pol’y, Issues with Taxing Marijuana at the State Level 1 (May 2015).
[31] Marijuana Taxes, supra note 27, at 392.
[32] Phillips, supra note 30, at 2.
[33] One example of a state legalizing marijuana against the legislature’s will was Colorado, where voters legalized recreational marijuana in direct opposition of the then Governor, who at the time strongly opposed legalization. Dan Kedmey, Colorado Governor: Legalizing Marijuana Was ‘Reckless’ Decision, Time (Oct. 7, 2014, 8:54 AM), https://time.com/3478057/colorado-john-hickenlooper-reckless/.
[34] Breakdown of Taxes in Adult-Use States, Marijuana Pol’y Project (May 26, 2021), https://www.mpp.org/issues/legalization/breakdown-taxes-adult-use-states/.
[35] Phillips, supra note 30, at 5.
[36] Id.
[37] Id.
[38] Joseph Gregorio, Physicians, Medical Marijuana, and the Law, 16 AMA J. Ethics 732, 733 (2014).
[39] German Lopez, The Federal Drug Scheduling System, Explained., Vox (Aug. 11, 2016, 9:05 AM), https://www.vox.com/2014/9/25/6842187/drug-schedule-list-marijuana.
[40] Id.
[41] David Downs, The Science Behind the DEA’s Long War on Marijuana, Sci. Am. (Apr. 19, 2016), https://www.scientificamerican.com/article/the-science-behind-the-dea-s-long-war-on-marijuana/.
[42] Dan Baum, Legalize It All: How to Win the War on Drugs, Harper’s Mag. (Apr. 2016), https://harpers.org/archive/2016/04/legalize-it-all/.
[43] Ezekiel Edwards, Emily Greytak, Brooke Madubuonwu, Thania Sanchez, Sophie Beiers, Charlotte Resing, Paige Fernandez, & Sagiv Galai, ACLU, A Tale of Two Countries: Racially Targeted Arrests in the Era of Marijuana Reform 5, 7 (2020), https://www.aclu.org/sites/default/files/field_document/marijuanareport_03232021.pdf.
[44] Id.
[45] Marijuana Pol’y Project, Summary of State Medical Marijuana Laws 1 (Dec. 17, 2018), https://www.mpp.org/issues/medical-marijuana/summary-of-state-medical-marijuana-laws/.
[46] Id.
[47] Breakdown of Taxes in Adult-Use States, supra note 34.
[48] Phillips, supra note 30, at 5; see supra subpart I.A.
[49] Phillips, supra note 30, at 5.
[50] A Road Map, supra note 4, at 2.
[51] Phillips, supra note 30, at 5.
[52] Marijuana Taxes, supra note 27, at 394.
[53] Phillips, supra note 30, at 5; States May Be Stuck, supra note 25, at 543.
[54] States May Be Stuck, supra note 25, at 543.
[55] Id.
[56] Phillips, supra note 30, at 5.
[57] State Medical Cannabis Laws, supra note 1.
[58] Marijuana Taxes, supra note 27, at 394.
[59] Id.
[60] Id.
[61] Breakdown of Taxes in Adult-Use States, supra note 34 (Arizona, Colorado, Illinois, Maine, Michigan, New Jersey, New York, and Rhode Island are examples of states where medical marijuana is exempt from excise taxes altogether or has a lower excise tax while not being completely tax-free.).
[62] A Road Map, supra note 4, at 26.
[63] Marijuana Taxes, supra note 27, at 393.
[64] Id.
[65] Phillips, supra note 30, at 4.
[66] Id.
[67] Id.
[68] Carl Davis, Misha E. Hill, & Richard Phillips, Inst. on Tax’n & Econ. Pol’y, Taxing Cannabis 12 (Jan. 2019), https://itep.sfo2.digitaloceanspaces.com/012319-TaxingCannabis_ITEP_DavisHillPhillips.pdf.
[69] Id.
[70] A Road Map, supra note 4, at 26–27.
[71] Id.
[72] Id.
[73] Id.
[74] Id.
[75] Phillips, supra note 30, at 3.
[76] Inst. on Tax’n & Econ. Pol’y, supra note 5, at 2; Phillips, supra note 30, at 3.
[77] A Road Map, supra note 4, at 27.
[78] Inst. on Tax’n & Econ. Pol’y, supra note 5, at 2.
[79] Id.; Phillips, supra note 30, at 3.
[80] Inst. on Tax’n & Econ. Pol’y, supra note 5, at 2.
[81] A Road Map, supra note 4, at 27.
[82] Leff, supra note 11, at 929; Phillips, supra note 30, at 3.
[83] A Road Map, supra note 4, at 27.
[84] Id. at 28.
[85] Id.
[86] Phillips, supra note 30, at 3.
[87] Inst. on Tax’n & Econ. Pol’y, supra note 5, at 2.
[88] Joseph Henchman, Tax Found., Taxing Marijuana: The Washington and Colorado Experience 2 (Aug. 2014), https://files.taxfoundation.org/legacy/docs/FF437.pdf.
[89] A Road Map, supra note 4, at 28.
[90] Id.
[91] What is Flash Frozen Cured?, Space Weed USA, https://www.spaceweedusa.com/learn (last visited Dec. 28, 2022) (A manufacturer of flash frozen marijuana flower claims its product has double the volume of “normal weed.”).
[92] A Road Map, supra note 4, at 28–29.
[93] Maureen Dowd, Opinion, Don’t Harsh Our Mellow, Dude, N.Y. Times (June 3, 2014), https://www.nytimes.com/2014/06/04/opinion/dowd-dont-harsh-our-mellow-dude.html.
[94] Leff, supra note 11, at 929.
[95] A Road Map, supra note 4, at 29.
[96] Id. at 13.
[97] Breakdown of Taxes in Adult-Use States, supra note 34.
[98] A Road Map, supra note 4, at 23, 29.
[99] Id. at 31.
[100] Id. at 29.
[101] Id.
[102] Id. at 29–30 (“This is no small issue as there may be significant problems developing tests
that reliably measure the THC level consistently. The marijuana industry is a young industry and currently test results depend on which lab tests the product.”).
[103] Marijuana Taxes, supra note 27, at 394.
[104] Id.
[105] A Road Map, supra note 4, at 29.
[106] Leff, supra note 11, at 929.
[107] States May Be Stuck, supra note 25, at 541. Oglesby specifically outlines these bases saying that “[p]ossible bases for marijuana taxes include weight, potency, percentage of sale price, number of plants, production area square footage, or abnormally high electricity use.” Id. He then rejects electricity as not being a feasible long-term solution. Id. at n. 12.
[108] States May Be Stuck, supra note 25, at 543.
[109] Id.
[110] Id.
[111] A Road Map, supra note 4, at 9.
[112] Id.
[113] Id. at 31.
[114] Id.
[115] See supra subpart III.C.
[116] A Road Map, supra note 4, at 31.
[117] Id.
[118] Id.
[119] Davis, Hill, & Phillips, supra note 68, at 10–11.
[120] Id.; States May Be Stuck, supra note 25, at 541.
[121] Davis, Hill, & Phillips, supra note 68, at 5.
[122] Id.
[123] Id. at 11.
[124] Id. at 5.
[125] Id. at 9.
[126] Id.
[127] A Road Map, supra note 4, at 30.
[128] Id.
[129] Id. at 32.
[130] Davis, Hill, & Phillips, supra note 68, at 11; A Road Map, supra note 4, at 31.
[131] A Road Map, supra note 4, at 31.
[132] Cannabis Tax Revenue in States that Regulate Cannabis for Adult Use, Marijuana Pol’y Project (Apr. 5, 2022), https://www.mpp.org/issues/legalization/cannabis-tax-revenue-states-regulate-cannabis-adult-use/.
[133] Davis, Hill, & Phillips, supra note 68, at 11.
[134] Id. at 9.
[135] Breakdown of Taxes in Adult-Use States, supra note 34.
[136] Id. at 9.
[137] Phillips, supra note 30, at 5; Davis, Hill, and Phillips, supra note 68, at 5.
[138] Marijuana Taxes, supra note 27, at 394.
[139] Phillips, supra note 30, at 5.
[140] Id.
[141] Marijuana Taxes, supra note 27, at 394.
[142] Breakdown of Taxes in Adult-Use States, supra note 34.
[143] Id.
[144] While South Dakota has passed an amendment which would legalize recreational marijuana, its Supreme Court is still deciding the constitutionality of the amendment. The proposed amendment did levy a tax which was solely based on price and would be 15% of the sales price at the retail level.
[145] Breakdown of Taxes in Adult-Use States, supra note 34.
[146] Id.
[147] Id.
[148] Resource Page for Taxes on Cannabis Sales – UPDATED, Ill. Revenue (June 27, 2021), https://www2.illinois.gov/rev/research/taxinformation/other/Pages/Cannabis-Taxes.aspx.
[149] Breakdown of Taxes in Adult-Use States, supra note 34.
[150] Id.
[151] States May Be Stuck, supra note 25, at 539.