Did you hear that Los Angeles won the bid for the 2028 Summer Olympic Games? It should attract many spectators and recreational weed states around the country must be jealous of California for all the recreational marijuana it is likely to sell. But, before California can start counting the money that it is going to make from the marijuana Olympic games, it has to find a way to fund it.
The big plan is that recreational marijuana and medical marijuana tax revenue will play a major role in funding the marijuana Olympic games, as will sponsorship from legal cannabis businesses. Proposition 64 takes effect at the beginning of 2018, 10 years before the games, leaving the state plenty of time to accrue the money it will need to put on a spectacular Olympics. Do you think that part of the reason why California made such an effort to so liberally legalize cannabis is that they knew the Olympics were coming? The decision to host the Olympics in Los Angeles came seven months after the vote to legalize recreational marijuana. Do you think that since Los Angeles is expected to be the epicenter of recreational marijuana in the United States, it played any role in the Olympic committee granting L.A. the games? Were there conversations held behind closed doors?
Cannabis industry insiders assert that California state revenue from marijuana legalization will play a major role in funding the 2028 Summer Olympics hosted by the city of Los Angeles.
Although the Organizing Committee for the Olympic Games will receive a $1.8 billion grant from the International Olympic committee per contract, hosting the Summer Olympics has cost a city an average of $5.2 billion (adjusted for inflation) since 1960. And of course, it’s a host city’s job to raise the capital to bridge that gap.
The current estimate for the cost of construction in Los Angeles is $5.3 billion, with the city leaning heavily on its existing sports infrastructure. But the Olympics are notorious for running over budget: The 2012 Rio Summer Olympics ended up costing about $1.6 billion more than planners anticipated. The 2008 Summer Olympics in Beijing cost a whopping $40 billion.
So how will Los Angeles pay for the modifications required to host thousands of athletes and even more fans? When it was still in the running to host the 2024 Summer Olympics, the city said they planned to save money through corporate sponsorship deals. But professionals in the marijuana industry have serious cause to think that they’ll be among those footing the bill.
The announcement that Los Angeles would host the 2028 Summer Olympics came seven months after California’s vote to legalize recreational marijuana, where sales are set to begin into effect on Jan. 1, 2018, but will likely be delayed. Estimates place the tax revenue that California will earn from the marijuana industry after the first year of legalization alone at $1 billion.
Matt Gray, CEO of marijuana-focused media platform HERB, predicts a very profitable future for legal marijuana.
“The cannabis industry is the fastest-growing in the world. In the U.S. alone it’s projected to be a $23 billion industry by 2020,” Gray said. “[This] means that year over year, it’s growing at a compound growth rate of 32 percent, and it’s projected to be larger than the NFL and organic foods. I believe in the next 10 years it’ll be bigger than alcohol.”
Marijuana industry leaders predict that this number will rise steadily over the next 11 years as the business of legal weed expands. Geoff Doran, co-founder of online cannabis distribution market Tradiv, estimated that by 2028 that the state’s cannabis tax revenue will have increased dramatically.
“We all know how much the Golden State or should I say the ‘Green State’ [loves]its cannabis,” Doran said. “Nobody fully understands the potential of the industry yet, but it’s not hard to fathom $12 billion in taxable revenue by 2028.”
In the past, Olympic athletes were prohibited from using marijuana at all. Champion swimmer Michael Phelps was famously embroiled in scandal after someone leaked a picture of him ripping bong at the University of South Carolina in 2009. Phelps lost a sponsorship from Kellogg and was suspended from competing for three months by USA Swimming as a result of the incident.
Policies on marijuana have, however, relaxed since then. The World Anti-Doping Agency, the regulatory body that codifies the substances that Olympians are and are not allowed to use while training or competing, relaxed its stance on marijuana in 2013 and adjusted the rules such that athletes who use marijuana on their own time, outside of the competition, don’t get penalized. Plus, the World Anti-Doping Agency announced this week that CBD will no longer be prohibited for athlete use, starting in 2018.
Doran foresees the Olympics adjusting to the marijuana industry once it becomes profitable.
“By the time the 2028 Olympics roll around in Los Angeles, the Olympic Games will look at cannabis just like any other industry,” he said. “With our ad dollars, we’ll be able to help many events like the Olympic Games tap into new revenue sources to increase their innovation and profitability. I think there will be many other collaborations with the cannabis industry.”
Matt Lee, co-founder of cannabis concentrate manufacturer Jetty Extracts, was less confident that the Olympics would be comfortable with marijuana. “I couldn’t see them being too open to the idea,” he said. “The science is there and athletes are beginning to see the benefits, but I think it will be the major sponsors worried about stigma that make it a slower progression than it needs to be.”
Dispelling the stigma surrounding marijuana is obviously critical when it comes to potential advertising collaborations between the cannabis industry and the Olympics, but according to Gray, it’s also crucial from a medicinal standpoint.
Marijuana’s classification as a Schedule I drug prevents scientists from studying marijuana to the fullest extent, but widespread legalization — and with medical marijuana currently legal in 29 states and Washington, D.C. — more and more studies are being conducted. “One amazing trend that I think I’m really excited about is the amount of research that’s going into cannabis,” Gray said.
Medical marijuana is often prescribed to manage pain from ailments ranging from cancer to chronic migraines. And Gray posits that Olympic athletes deal with more pain than most.
“These people, they’re human beings,” he said. “They suffer from higher rates of injury than people in normal occupations, and they should be able to remedy those injuries in a sustainable fashion, through cannabis, rather than using harmful methods, like opioids.”
And what can the Olympians and Olympic spectators do for the cannabis industry in return for its monetary and medical support?
“Hopefully they buy a lot of weed!” Lee said.