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Legal weed clashes with child care. Why a cannabis tax cut could spell trouble for children

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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.

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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.

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“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.

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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.

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“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.

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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.

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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.

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Appeals court declares DC ban on certain gun magazines unconstitutional

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Appeals court declares DC ban on certain gun magazines unconstitutional

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An appeals court struck down a local law in the District of Columbia that banned gun magazines containing more than 10 bullets, describing the measure as unconstitutional. 

The ruling Thursday from the District of Columbia Court of Appeals also reversed the conviction of Tyree Benson, who was taken into custody in 2022 for being in possession of a handgun with a magazine that could contain 30 bullets, according to The New York Times. 

“Magazines capable of holding more than 10 rounds of ammunition are ubiquitous in our country, numbering in the hundreds of millions, accounting for about half of the magazines in the hands of our citizenry, and they come standard with the most popular firearms sold in America today,” Judge Joshua Deahl wrote on behalf of the two-judge majority in the three-judge panel.   

“Because these magazines are arms in common and ubiquitous use by law-abiding citizens across this country, we agree with Benson and the United States that the District’s outright ban on them violates the Second Amendment,” he added.

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A salesperson holds a high capacity magazine for an AR-15 rifle at a store in Orem, Utah, in March 2021.  (George Frey/Bloomberg via Getty Images)

“This appeal presents a Second Amendment challenge to the District’s ban on firearm magazines capable of holding ‘more than 10 rounds of ammunition.’ Appellant Tyree Benson argues that ban contravenes the Second Amendment so that his conviction for violating it should be vacated,” Deahl also wrote. “The United States, which prosecuted Benson in the underlying case and defended the ban’s constitutionality in the initial round of appellate briefing, now concedes that this ban violates the Second Amendment. The District of Columbia, which is also a party to this appeal, continues to defend the constitutionality of its ban.” 

“We therefore reverse Benson’s conviction for violating the District’s magazine capacity ban. And because Benson could not have registered, procured a license to carry, or lawfully possessed ammunition for his firearm given that it was equipped with a magazine capable of holding more than 10 rounds, we likewise reverse his convictions for possession of an unregistered firearm, carrying a pistol without a license, and unlawful possession of ammunition,” Deahl said.

Chief Judge Anna Blackburne-Rigsby, the judge who dissented, wrote that, “The majority bases its common usage analysis on ownership statistics that show only that magazines holding 11, 15, or 17 rounds of ammunition are in common use.” 

GUN RIGHTS ON PRIVATE PROPERTY DEBATED AT SUPREME COURT

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Magazines at Norm’s Gun & Ammo shop in Biddeford, Maine, in April 2013. From left, the first two are high capacity magazines for handguns, an AK-47 magazine, an AR-15 magazine and an SKS magazine.   (Shawn Patrick Ouellette/Portland Press Herald via Getty Images)

“The majority, however, fails to contend with the reality that these statistics do not support the conclusion that the particularly lethal 30-round magazine, such as the one Mr. Benson possessed here, is in common use for self-defense. It simply is not,” she added.

The District of Columbia can now appeal the decision to the Supreme Court, or ask the local appeals court to take another look at the ruling with a larger panel of judges, according to the Times. 

High-capacity rifle magazines are removed from a display at Freddie Bear Sports in January 2023 in Tinley Park, Illinois. (Scott Olson/Getty Images)

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The newspaper also reported that in a previous case, the U.S. Court of Appeals for the District of Columbia upheld the constitutionality of the local law surrounding gun magazine sizes. It’s unclear how the two rulings will interact. 

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Mike Lee unveils national constitutional carry bill to override 'hostile' state gun laws
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Contributor: The stars align for Democrats in Texas. Trump is helping them

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Contributor: The stars align for Democrats in Texas. Trump is helping them

If Democrats expect to flip a U.S. Senate seat in Texas, they’ll need all the stars to align. This almost never happens, because politics has a way of scrambling the constellations. But on Tuesday, the first star blinked on.

I’m referring to state Rep. James Talarico’s victory over Rep. Jasmine Crockett in the Democratic primary. Most political prognosticators agree that Talarico, an eloquent young Democrat who speaks openly about his Christian faith, is their best hope in a red state that Donald Trump won by 14 points.

The second star was Crockett’s conciliatory concession — far from a foregone conclusion after a nasty primary — in which she pledged to “do my part,” adding that “Texas is primed to turn blue, and we must remain united because this is bigger than any one person.”

The third star — a vulnerable Republican opponent — has not yet appeared over the Texas sky, although forecasters say it might.

Most observers agree that scandal-plagued Atty. Gen. Ken Paxton would be beatable in the general election, while incumbent Sen. John Cornyn would present a much tougher challenge. Cornyn is the kind of steady, conventional politician who tends to win elections, and so, of course, modern voters are extremely suspicious of him.

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In the GOP primary on Tuesday, Cornyn’s 42% share of the vote edged out Paxton by about a point. Unfortunately for Republicans, neither candidate garnered enough votes to avoid a May 26 runoff election.

Conventional wisdom suggests that when a majority of Republican voters choose someone other than the incumbent in the first round of voting, an even greater majority will inevitably break toward the challenger in the runoff. If that happens, Paxton would become the nominee, and Democrats would get their third star to align.

Even better for Democrats — a fourth star, so to speak — would be for this protracted runoff to become a “knife fight,” as one Texas Republican predicted, in which Paxton staggers out of the fight as the battered GOP nominee.

The only problem is that Republicans can see these stars aligning, too.

And while the Texas Senate seat matters a lot on its own, it matters even more in the context of nationwide midterm elections, in which a Texas win would help Democrats take back the Senate.

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Enter the cavalry — or, more accurately, President Trump, who is now entering a second war in the span of a week, this one a civil war in the Lone Star State.

The day after the primary, Trump announced that he would be “making my Endorsement soon, and will be asking the candidate that I don’t Endorse to immediately DROP OUT OF THE RACE!”

Reports suggest Trump may endorse Cornyn in order to save the seat for Republicans. But who knows? Trump is famously unpredictable. And it’s likely he admires Paxton’s ability to survive scandals that would have caused most normal politicians to curl up in the fetal position. As they say, “game recognizes game.”

Whomever he backs, conventional wisdom also says Trump should make his endorsement “soon,” as he promised. That would save Republicans a lot of time and money. But Trump currently has enormous leverage. Right now, people are coming to him, pleading for his support.

Do you think he wants to resolve that situation quickly?

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Me neither.

With Trump, you never know what you’re going to get. In 2021, he helped torpedo Republican Senate candidates David Perdue and Kelly Loeffler in Georgia, handing Democrats control of the Senate. The following year he backed football legend Herschel Walker in another Georgia Senate race, which did not exactly work out great. Democrat Raphael Warnock won and holds that seat, though Walker is now ambassador to the Bahamas so that’s something.

This is to say: Trump’s political assistance does not always assist.

It’s unclear whether Trump’s endorsement would be dispositive — and whether he could muscle the other Republican out of the primary race.

Paxton, for example, initially vowed to stay in the race, no matter what. (He later suggested he would “consider” dropping out if the Senate passes the SAVE America Act, a bill to require proof of citizenship to vote.)

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There’s also this: Trump’s endorsements tend to either be made out of vengeance or to pad the totals of an already inevitable winner, so his track record is probably overrated.

Case in point: While most of his endorsed candidates won their Texas elections, his endorsed candidate for agriculture commissioner lost reelection. And according to the Texas Tribune, “at least three Trump-endorsed candidates for Congress were headed to runoffs, one of them in a distant second place.”

Another issue is that Cornyn needs more than a perfunctory endorsement: He needs a clear, full-throated endorsement.

In a 2022 Missouri Senate race, Trump endorsed “ERIC,” which was awkward because two candidates named Eric were running.

More recently, he endorsed two rival candidates in the same 2026 Arizona gubernatorial race — like betting on both teams in the Super Bowl.

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This is all to say that the only thing standing between Texas Democrats and a rare celestial alignment may be the whims of the Republican Party’s one and only star.

Sure, establishment Republicans can beg Trump to quickly step in and settle the race, and maybe he will. But it’s entirely possible the president will find a way to blow up his party’s chances for holding the U.S. Senate — and there’s nothing they can do to stop him.

When you’re a star, they let you do it.

Matt K. Lewis is the author of “Filthy Rich Politicians” and “Too Dumb to Fail.”

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Video: President Fires Noem as Homeland Security Secretary

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Video: President Fires Noem as Homeland Security Secretary

new video loaded: President Fires Noem as Homeland Security Secretary

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President Fires Noem as Homeland Security Secretary

President Trump fired Kristi Noem, his embattled homeland security secretary, on Thursday and announced his plans to replace her with Senator Markwayne Mullin of Oklahoma.

“The fact that you can’t admit to a mistake which looks like under investigation is going to prove that Ms. Good and Mr. Pretti probably should not have been shot in the face and in the back. Law enforcement needs to learn from that. You don’t protect them by not looking after the facts.” “Our greatness calls people to us for a chance to prosper, to live how they choose, to become part of something special. Anyone who searches for freedom can always find a home here. But that freedom is a precious thing, and we defend it vigorously. You crossed the border illegally — we’ll find you. Break our laws — we’ll punish you.” “Did you bid out those service contracts?” “Yes they did. They went out to a competitive bid.” “I’m asking you — sorry to interrupt — but the president approved ahead of time you spending $220 million running TV ads across the country in which you are featured prominently?” “Yes, sir. We went through the legal processes. Did it correctly —” Did the president know you were going to do this?” “Yes.” “I’m more excited about just ready to get started. There’s a lot of work we can do to get the Department of Homeland Security working for the American people.”

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President Trump fired Kristi Noem, his embattled homeland security secretary, on Thursday and announced his plans to replace her with Senator Markwayne Mullin of Oklahoma.

By Jackeline Luna

March 5, 2026

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