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Chicago Suburb’s Plan To Fund Reparations Through Marijuana Sales Tax Backfires

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Evanston, Illinois, a Chicago suburb, attempted to fund its racial reparations program through a tax on legal marijuana, a plan that backfired spectacularly, according to The Washington Post.

The city planned to fund reparations through $10 million in marijuana taxes from three dispensaries that were expected to open beginning in 2019, but only one of those dispensaries materialized, bringing in far below the projected $500,000 to $750,000 per year in tax revenue, according to the Post. As a result, only 16 people have received reparation funds, while there are 106 people on the waiting list and at least five people have died waiting for their payments.

Marijuana dispensaries in Illinois have struggled in recent years due to lack of funding related to restrictions on banking for cannabis companies and heightened regulations for cannabis businesses, according to the Chicago Tribune. Illinois issued 342 new craft grower, infuser and transporter licenses and 192 dispensary licenses by the middle of 2022, but most of those businesses failed to take off; the state still has one of the highest consumer marijuana costs in the country, and people continue to buy through illegal channels, dodging city taxes.

To qualify for reparations, residents must be black and have evidence that they have an ancestor who lived in Evanston between 1919 and 1969, when the city was segregated, according to the Post. The $25,000 reparation payment is only available to homeowners and can only be used on home improvements or purchasing a home, despite the fact that only 35% of black Evanston residents own homes.

The city has only spent $400,000 on reparations so far, falling short of its $10 million goal, according to the Post. Recipients spent the money paying down mortgages and making repairs to roofs and windows, and one recipient “balled out” on marble in an upgraded bathroom, according to Rue Simmons, a local woman who championed the program.

The City of Evanston did not respond to the Daily Caller News Foundation’s request for comment.

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