The economic downturn has resulted in reduced tax revenues for the states, creating significant budget problems. States are now with faced with deciding about state employee layoffs, pay cuts, tax increases and service cuts.

One simple. relatively popular, and basically pain-free way to alleviate a state’s budget problems that is only now starting to get some attention is legalizing, taxing and regulating marijuana.

Recently, two states, California and Washington, have put out official analyses of the likely revenue that would be generated from marijuana legalization. The California State Board of Equalization (PDF) determined a marijuana legalization and taxation bill would result in $1.38 billion in new revenue, about $37 per person. The Washington State Office of Finical Management found a legalization and taxation bill in that state would generate about $180 million in state revenue, about $26 per person, plus millions in local taxes.

These two figures were used to create a chart with very rough estimates about how much each state could generate by taxing and regulating marijuana in ways similar to alcohol, based on population:

State Population Projected Revenue Assuming $26 per Person (Washington) Projected Revenue Assuming $37 per Person (California)
Alabama 4,779,736 119,493,400 176,850,232
Alaska 710,231 17,755,775 26,278,547
Arizona 6,392,017 159,800,425 236,504,629
Arkansas 2,915,918 72,897,950 107,888,966
California 37,253,956 931,348,900 1,378,396,372
Colorado 5,029,196 125,729,900 186,080,252
Connecticut 3,574,097 89,352,425 132,241,589
Delaware 900,877 22,521,925 33,332,449
Florida 18,801,310 470,032,750 695,648,470
Georgia 9,687,653 242,191,325 358,443,161
Hawaii 1,360,301 34,007,525 50,331,137
Idaho 1,567,582 39,189,550 58,000,534
Illinois 12,830,632 320,765,800 474,733,384
Indiana 6,483,802 162,095,050 239,900,674
Iowa 3,046,355 76,158,875 112,715,135
Kansas 2,853,118 71,327,950 105,565,366
Kentucky 4,339,367 108,484,175 160,556,579
Louisiana 4,533,372 113,334,300 167,734,764
Maine 1,328,361 33,209,025 49,149,357
Maryland 5,773,552 144,338,800 213,621,424
Massachusetts 6,547,629 163,690,725 242,262,273
Michigan 9,883,640 247,091,000 365,694,680
Minnesota 5,303,925 132,598,125 196,245,225
Mississippi 2,967,297 74,182,425 109,789,989
Missouri 5,988,927 149,723,175 221,590,299
Montana 989,415 24,735,375 36,608,355
Nebraska 1,826,341 45,658,525 67,574,617
Nevada 2,700,551 67,513,775 99,920,387
New Hampshire 1,316,470 32,911,750 48,709,390
New Jersey 8,791,894 219,797,350 325,300,078
New Mexico 2,059,179 51,479,475 76,189,623
New York 19,378,102 484,452,550 716,989,774
North Carolina 9,535,483 238,387,075 352,812,871
North Dakota 672,591 16,814,775 24,885,867
Ohio 11,536,504 288,412,600 426,850,648
Oklahoma 3,751,351 93,783,775 138,799,987
Oregon 3,831,074 95,776,850 141,749,738
Pennsylvania 12,702,379 317,559,475 469,988,023
Rhode Island 1,052,567 26,314,175 38,944,979
South Carolina 4,625,364 115,634,100 171,138,468
South Dakota 814,180 20,354,500 30,124,660
Tennessee 6,346,105 158,652,625 234,805,885
Texas 25,145,561 628,639,025 930,385,757
Utah 2,763,885 69,097,125 102,263,745
Vermont 625,741 15,643,525 23,152,417
Virginia 8,001,024 200,025,600 296,037,888
Washington 6,724,540 168,113,500 248,807,980
Washington, D.C. 601,723 15,043,075 22,263,751
West Virginia 1,852,994 46,324,850 68,560,778
Wisconsin 5,686,986 142,174,650 210,418,482
Wyoming 563,626 14,090,650 20,854,162

These are just rough projections to give a ballpark impression of how much potential new revenue is at stake. Obviously, the exact amounts for each state would vary significantly based on several factors like demographics, exact tax rates, consumption rates, design of the law, and rules in surrounding states. Ideally, comparing these figures to the current budget deficits will spur looking at taxing and regulating marijuana as an alternative to some current proposals like massive teacher layoffs.

Interesting Wisconsin could probably generate between $140-210 million from taxing and regulating marijuana, which would be sufficient to coverthis year’s $137 million shortfall that Republican Gov. Scott Walker is using as an excuse to take away collective bargaining for some public sector unions.