DeWine Proposes Cannabis Tax Overhaul, Sparking City Backlash

23 March 2025

Ohio’s booming recreational cannabis market has pulled in more than $390 million in sales since August 2023, generating over $30 million in excise tax revenue. But despite early promises, none of that money has reached the cities hosting dispensaries — and local leaders are demanding answers.

Under the ballot measure approved by voters, 36% of cannabis tax revenue was supposed to go to the Host Community Cannabis Fund, directly benefiting municipalities and townships with licensed dispensaries. Cities like Cleveland and South Euclid had already budgeted for these funds, expecting hundreds of thousands of dollars to support local infrastructure and services.

Now, Governor Mike DeWine’s new budget proposal aims to reroute that money to statewide programs — including police training, jail improvements, and addiction services. The move has sparked backlash from city officials and the Ohio Municipal League, who say the state is changing the rules after the fact and jeopardizing the future of local cannabis zoning.

DeWine’s administration argues that because the ballot measure lacked specific spending language, the legislature has full control over the funds. Meanwhile, lawmakers are debating competing proposals, like House Bill 96, which could reshape how cannabis tax dollars are distributed going forward.

For cannabis users, business owners, and ancillary operators, the outcome could have ripple effects — from tax increases and regulatory changes to potential pushback from cities that feel burned by the state. With more legislative moves on the table, the stakes are high for Ohio’s cannabis future.