Politics
Legal weed clashes with child care. Why a cannabis tax cut could spell trouble for children
A fight over taxes consumers pay for cannabis products has prompted a standoff between unusual adversaries: child-care advocates and the legal weed industry.
On July 1, California’s cannabis excise tax increased from 15% to 19% as part of a political deal struck in 2022 to help stabilize the fledgling legal market. But the industry now says the increase is untenable as it faces a sharp decline in revenue and unfair competition from the growing illicit market.
An industry-sponsored bill moving through the Legislature — and already passed by the Assembly — would eliminate the tax increase and lower the rate back to 15% for the next six years. This would reduce by $180 million annually the tax revenue that the state contributes toward law enforcement, child care, services for at-risk youth and environmental cleanup.
The losses include about $81 million annually that would have specifically funded additional subsidized child-care slots for about 8,000 children from low-income families.
“They are choosing the cannabis industry over children and youth,” said Mary Ignatius, executive director of Parent Voices California, which represents parents receiving state subsidies to help pay for child care.
Child care faces setbacks
The tension over taxes for legal weed versus child care — both industries in crisis — highlights the inherent pitfalls of funding important social services with “sin taxes,” whether it’s alcohol, weed or tobacco — funding that experts say is often unstable and unsustainable.
Engage with our community-funded journalism as we delve into child care, transitional kindergarten, health and other issues affecting children from birth through age 5.
The measure’s next stop is the Senate. All bills in the Legislature must be passed by Sept. 12, and the governor must sign them by Oct. 12.
“We can both support the legal cannabis industry and protect child care. If the measure reaches the governor’s desk and is signed into law, we will work with the Legislature to ensure there are no cuts to child care due to this policy change,” said Diana Crofts-Pelayo, a spokesperson for Gov. Gavin Newsom.
But it’s unclear where money to backfill the losses would come from, as the state grapples with declining finances and federal funding cuts.
The money from cannabis taxes represents a fraction of California’s $7-billion annual child care budget. But as federal cuts to social services for low-income families, including Head Start, continue, any potential loss creates a sense of panic among child care advocates who say California ought to be shoring up revenue options right now — not reducing them.
“Every single dollar needs to remain in the programs that are serving our children and families. What may seem like a small amount to some is everything for advocates who are fighting for it,” said Ignatius.
The past decade has been a time of progress for child care advocates, as the state rebuilt a child care industry decimated by cuts during the Great Recession. California has more than doubled spending on child care since the recession low, added about 150,000 new subsidized child care slots, eliminated the fees paid by families, increased pay for child care workers and added a new public school grade level for 4-year-olds.
But despite these efforts to bolster the market, California’s child care industry still suffers from low pay for workers, unaffordable costs for families, and a shortage of spaces for infants and toddlers.
The waiting list for subsidized child care slots is still so long that some parents have taken to calling it the “no hope list,” said Ignatius. Those who join the list know they could wait years before a spot opens up, and by that time their child may already be in kindergarten or beyond.
Jim Keddy, who serves on an advisory committee to help determine what programs the tax will finance, opposes the proposed reduction.
“If you don’t work to promote and hold on to a funding stream for children, someone eventually takes it from you,” said Keddy, who is also executive director of Youth Forward, a youth advocacy organization.
The cannabis industry, however, argues that while the causes the tax supports may be worthwhile, market conditions are so abysmal that it cannot weather an increase.
Legal cannabis industry struggles to remain afloat
“It is sad that the cannabis industry is being pit against social programs, childhood programs and educational programs,” said Jerred Kiloh, president of United Cannabis Business Assn. and owner of the Higher Path dispensary in Sherman Oaks. “The reality is, if our legal industry keeps declining, then so does their tax revenue.”
In 2022, when the cannabis industry agreed to increase the excise tax, quarterly cannabis sales were at their peak. The agreement offered the new industry temporary relief by eliminating the cultivation tax passed by voters under Proposition 64, the 2016 initiative that legalized cannabis. In exchange, state regulators would be able to increase the excise tax after three years to make the change revenue neutral.
But since then, sales have plunged to their lowest levels in five years, due in part to the growing illicit market that is siphoning off sales from legal dispensaries.
In L.A., Kiloh said that between state and local taxes, his legal dispensary customers end up paying 47% in taxes on their purchase. But if they shopped instead at any of the thousands of stores in L.A. selling cannabis products without a license, they could avoid state and local cannabis taxes entirely.
“A 30% increase in an excise tax that is already egregious is just kind of the breaking point for a lot of consumers,” said Kiloh.
Even before the excise tax hike went into effect, just 40% of the cannabis consumed in California was obtained from the legal market, according to the California Department of Cannabis Control.
The measure to drop the excise tax, AB564, received widespread support from Assembly members, including stalwart supporters of early childhood education like Assembly Majority Leader Cecilia Aguiar-Curry (D-Winters), chair of the Legislative Women’s Caucus.
“Revenues from legal sales of cannabis are already dropping and if we keep raising the tax they’ll drop even more. That penalizes cannabis businesses who are doing the right thing and working within the legal market. And, it makes illegal sales from cartels and criminals more competitive,” she said in a statement. “We need to fund our kids’ education through the State General Fund, but if we want to supplement education and youth programs, cannabis tax dollars will only exist if we steady the legal market and go after those illegal operators.”
How reliable are sin taxes?
Lucy Dadayan, a researcher who studies sin taxes at the Tax Policy Center, a nonpartisan think tank based in Washington, D.C., said the California predicament reflects a larger problem with sin taxes.
If a sin tax is successful and consumption drops — as it has with tobacco — “the tax base shrinks. And in the case of cannabis, there’s the added wrinkle that a high tax rate can push consumers back into the illicit market, which also reduces revenue,” she said.
This is not the first time services for the state’s youngest children have been affected by reductions in a sin tax.
In 1998, California voters slapped cigarettes with a hefty surcharge to pressure smokers to give up their habit. The state used the money to fund “First 5” organizations in every county, which are dedicated to improving the health and well-being of young children and their families. But the less people smoked over time, the less money was available for early childhood programs, and the First 5 system now finds itself confronting an existential crisis as it faces a rapidly declining revenue source.
Meanwhile, the critical social services like child care that come to depend on sin taxes tend to get more and more expensive, creating a “mismatch” in the tax structure versus the need, said Dadayan.
“In the short term, these taxes can raise a lot of money and help build public support for legalization or regulation. But in the long term, they can leave important programs vulnerable because of shifting consumption patterns,” she said.
This article is part of The Times’ early childhood education initiative, focusing on the learning and development of California children from birth to age 5. For more information about the initiative and its philanthropic funders, go to latimes.com/earlyed.
new video loaded: Former Presidents Speak at Jesse Jackson’s Memorial
transcript
transcript
Former Presidents Speak at Jesse Jackson’s Memorial
Barack Obama, Joseph R. Biden Jr. and Bill Clinton were among the dozens of speakers at a public memorial for the late Rev. Jesse Jackson in Chicago on Friday. The event celebrated the civil rights leader’s commitment to public service and racial justice.
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“It was because of that path that he had laid, because of his courage, his audacity, that two decades later a young Black senator from Chicago’s South Side would even be taken seriously as a candidate for the presidential nomination. The last time he and I had a chance to visit in person, he was already ailing. It was getting difficult for him to stand, difficult for him to speak. Figured we’d just have a low-key visit. Maybe he’d need some rest. And he starts coming up with this project and this initiative and issues I needed to look into.” “He used his gifts to influence generations, generations of Americans, and countless elected officials including presidents, as you see here today.” “We did not always agree, but I’ll tell you one thing. He made me a better president when I got in office. Because he was always pushing on things and he knew that change came from the outside in.” “In the movements for justice that have grown from the seeds that he tilled. Now, to the world, Jesse Jackson was an ambassador of hope for the oppressed who met with kings and queens and presidents and dictators and clergy of all the great religions. But here in Chicago, he was our neighbor.”
By Jorge Mitssunaga
March 6, 2026
Politics
Man convicted of Iran-backed Trump assassination plot compared his plan to Butler shooting: FBI
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A Pakistani man convicted Friday in federal court of plotting to assassinate President Donald Trump and other politicians told an FBI agent he thought Iran “was responsible” for the assassination attempt on Trump in Butler, Pennsylvania.
Asif Merchant, 47, told the FBI agent, Jacqueline Smith, that the incident “was the same thing he was sent here to do,” Smith testified during Merchant’s trial. Merchant told jurors the Islamic Revolutionary Guard Corps (IRGC) sent him on a “mission” to kill U.S. politicians, including by telling him to attend a Republican rally.
Merchant was arrested July 12, 2024, one day prior to the shooting in Butler, where Thomas Crooks fired several shots into a rally crowd, killing one and grazing Trump’s ear.
The FBI has said repeatedly it found no evidence that Crooks had co-conspirators or that any foreign actors were involved in the incident.
A sketch showing Asif Merchant, a Pakistani national with alleged ties to Iran, appearing in federal court in Brooklyn, N.Y., Wednesday, March 4, 2026. Merchant was on trial for charges related to a foiled 2024 plot to assassinate a high-profile U.S. politician, identified by defense and law enforcement sources as President Donald Trump. (Christine Cornell)
Merchant, who was found guilty on all charges Friday after fewer than two hours of deliberation, was convicted by a jury in Brooklyn, New York, of murder-for-hire and attempting to commit terrorism. He testified that Trump was not his only target, telling jurors then-President Joe Biden and former presidential candidate Nikki Haley were also on his list.
He claimed he only took part in the plot, which was foiled by the FBI before coming to fruition, because Iran’s IRGC warned it would target his family.
FORMER IRANIAN MINISTER PRAISES TRUMP ASSASSINATION FATWA AS DAUGHTER LIVES IN NEW YORK
“I had no other options,” Merchant said. “My family was threatened.”
Merchant now faces a maximum penalty of life in prison. His sentence will be determined at a later hearing.
Attorney General Pam Bondi said in a statement that Merchant “landed on American soil hoping to kill President Trump — instead, he was met with the might of American law enforcement.”
“The Department of Justice will remain ever-vigilant to protect Americans, prosecute terrorists, and halt acts of terrorism before they happen,” Bondi said.
This image provided by the Justice Department, contained in the complaint supporting the arrest warrant, shows Asif Merchant. (Justice Department via AP, File)
Merchant was arrested after he was recorded on camera outlining a plot on a napkin to kill a politician with a person who turned out to be an FBI informant. Federal prosecutors showed video during the trial of Merchant speaking to the informant. The prosecutors said Merchant also tried to hire two hit men and pay them $5,000, but the men turned out to be federal agents posing as assassins.
Smith, the FBI agent who met with Merchant after his arrest, said Merchant never conveyed that he feared for his family. Merchant said he wanted to do intelligence work and be paid for it, Smith said.
TRUMP DECLARES ‘I GOT HIM BEFORE HE GOT ME’ AFTER IRAN’S SUPREME LEADER KILLED IN STRIKE
Republican presidential candidate Donald Trump is whisked away by the Secret Service after shots rang out at a campaign rally at Butler Farm Show Inc. July 13, 2024, in Butler, Pa. (Jeff Swensen/Getty Images)
The FBI agent also said Merchant was told by an Iranian handler to attend a Republican political rally to scope out security. But Merchant was worried about being identified, so he watched the rally online instead.
Merchant’s defense team told jurors their client, who has two wives, was a family man and cared deeply about his faith and that he intentionally acted carelessly because he wanted to be caught.
In their closing arguments, defense lawyers said Merchant had his hand forced in the operation, thinking his family would be harmed if he did not cooperate. Additionally, the lawyers cited several instances in which Merchant’s actions as an intelligence operator were little more than incompetent.
Fox News’ Danielle Cavaliere, Brendan McDonald and Alexis McAdams contributed to this report.
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Politics
Veteran Rep. Darrell Issa decides not to seek reelection in new Democratic-leaning district
Veteran Republican Rep. Darrell Issa announced Friday that he will not run for reelection in his newly configured congressional district in San Diego and Riverside counties.
“This decision has been on my mind for a while and I didn’t make it lightly,” Issa said in a statement, arguing that he would have won the 2026 race based on his campaign’s polling and his support from President Trump among others. “But after a quarter-century in Congress — and before that, a quarter-century in business — it’s the right time for a new chapter and new challenges.”
Issa called serving in Congress “the honor of my life,” and highlighted his work for constituents such as 100-year-old retired Navy fighter pilot Royce Williams, who was awarded a congressional medal of honor during Trump’s State of the Union address. “… every day my teams in Washington and California have worked to deliver for our constituents,” Issa said.
Issa, among the wealthiest members of Congress, began telling people earlier this week that he would retire from Congress, sources said.
He had an outsized impact on state and national politics, according to political experts and strategists, including funding the successful 2003 recall of Gov. Gray Davis, which ushered Arnold Schwarzenegger into office, and his work as the head of the powerful House Oversight and Government Reform Committee during high-profile investigations of the Obama administration.
“Darrell Issa was a constant and consequential presence in the Republican Party in California without ever being its most prominent leader,” said Thad Kousser, a political science professor at UC San Diego. “He’s the person probably most responsible for the recall of Gray Davis going forward, but then he got boxed out of the race when Arnold Schwarzenegger got in. He became one of the most prominent protagonists of Barack Obama. But that never elevated him to statewide prominence or statewide office in his own state.”
National and state Republicans lauded Issa.
“We are grateful for Congressman Darrell Issa’s decades of dedicated service to the people of California and our nation,” said Christian Martinez, the spokesman for the National Republican Congressional Committee. “Throughout his career, he has embodied the spirit of public service, championed our military, and fought tirelessly for a stronger America.”
Kevin Spillane, a San Diego-area GOP political strategist, said Issa substantially enhanced his national profile during the investigation into the 2012 attack on the U.S. diplomatic mission in Benghazi, that resulted in the death of Ambassador Christopher Stevens and three other Americans.
“He’s been a national figure pretty much since he has been in Congress,” Spillane said. “He was of the people most vocal on Benghazi. He has been a national foil to Obama and Hillary Clinton. He was a major statewide figure in terms of funding the recall that allowed Arnold Schwarzenegger to be elected. He has been a major figure in San Diego County politics for more than two decades. He’s an important member of Congress.
“It is a loss for California Republicans in terms of our congressional delegation,” Spillane said. “It’s a loss for national Republicans in terms of losing a significant figure in the Republican caucus.”
Issa’s move was prompted by the reconfiguration of his congressional district under Proposition 50, a redistricting plan voters passed in November to counter President Trump’s efforts to push GOP-led states to redraw their congressional lines to favor Republicans.
“Rep. Issa is unfortunately a victim of his own inaction,” said Paul Mitchell, the Democratic strategist who drew the new congressional districts voters approved in November that made Issa’s reelection prospects shaky. “Privately all the California Republican incumbents knew it was a mistake, and yet the veterans with all the chairmanships and power didn’t speak out.”
Issa wasn’t the only Republican member of California’s congressional delegation whose reelection plans shifted on Friday because of Proposition 50.
Rep. Kevin Kiley (R-Roseville) made a surprise announcement Friday evening that he would run for reelection as an independent candidate.
Voter-approved redistricting last year fractured Kiley’s huge Northern California district into six pieces. Earlier this week he announced he would run in the district that includes his hometown and other Sacramento-area suburbs but has a nine-point Democratic voter registration advantage.
Kiley described his decision to run as a no party preference candidate as a way to “fight back and protect our democracy” from “partisan games.”
“It is no secret I’ve been frustrated, at times disgusted, by the hyper-partisanship in Congress. In the last year it’s led to the longest government shutdown in U.S. history, a massive increase in healthcare costs, and of course, a pointless redistricting war,” Kiley wrote on the social media site X.
Shortly after Issa announced his retirement Friday evening, Democrats were quick to celebrate and boast about the party’s prospects of winning the seat and increasing its ranks in California’s congressional delegation.
“After over two decades of disastrous representation, Darrell Issa is once again running for the exits — and good riddance,” said Anna Elsasser, spokesperson for the Democratic Congressional Campaign Committee. “Issa abandoning his voters now is the clearest sign yet that Republicans know he can’t win on his record of skyrocketing prices, gutting healthcare, and looking out for himself and wealthy special interests above all else.”
Issa endorsed San Diego County Supervisor Jim Desmond to replace him. His supervisorial districts includes more than a quarter of the new district.
Desmond has been running in a neighboring congressional district that straddles Orange and San Diego counties that is currently represented by Rep. Mike Levin (D-San Juan Capistrano). Though the Levin district has been considered competitive, Proposition 50 made it more safely Democratic. Desmond withdrew from that race and filed to run in Issa’s district on Thursday, according to the San Diego County registrar of voters.
Issa, 72, has represented various San Diego-area districts in Congress for 23 years. Issa’s once solidly Republican district had been trending more moderate in recent years.
Democratic registered voters outnumber Republicans by more than four percentage points in Issa’s new district, which spans San Diego and Riverside counties and was reshaped to include liberal communities such as Palm Springs, according to the nonpartisan California Target Book. Issa’s current congressional district had a 12-percentage-point GOP edge in voter registration in 2024.
As soon as the new districts were approved, speculation began swirling about Issa‘s reelection plans. Some of his supporters in Texas urged him to move there to run in a GOP-friendly Dallas-area district, but he said in December that he declined and would instead seek reelection in California.
“I believe that the people of San Diego County, who have elected me so many times, will, in fact, regardless of registration, vote for me,” Issa told the Fox affiliate in San Diego in December. “This is my home, and I’m going to fight for it.”
Several Democrats had already announced plans to challenge Issa, including San Diego City Council member Marni Lynn von Wilpert and repeat candidate Ammar Campa-Najar.
Issa, a high school dropout and Army veteran, made his fortune by purchasing a struggling electronics business in 1980 and transforming it into the Viper car alarm system, with Issa’s voice warning potential thieves to “stand back.”
Times staff writer Nicole Nixon contributed to this report.
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