During Governor Phil Murphy’s campaign for the Garden State’s top office in the 2017 election, he promised to work with the state’s legislature to legalize adult use cannabis in New Jersey during his first year in office. However, the drive fell short despite a major victory in November when two panels in the Senate and Assembly passed three bills that would pave the way to making adult use cannabis a reality.
Further debate and (hopefully) a vote will now be pushed out to 2019.
If and when current points of contention are settled, the primary bill will allow adults (21 years of age and older) to consume, as well as buy and possess up to an ounce of cannabis. In addition:
- A Cannabis Control Commission will be established and responsible for licensing all cannabis-based businesses.
- At the state level, cannabis sales will be taxed at 12% and local governments may also apply an additional 2% tax.
- Dispensaries will be able to create consumption areas upon approval by local government. This would essentially give customers a place to enjoy cannabis outside of their homes.
- Programs will be set up to support minority-owned, female-owned and small businesses.
- Local governments will be able to prohibit cannabis-based businesses within their communities.
- Dispensaries will be able to create a fleet or hire independent contractors to deliver cannabis to customers who might not have transportation or live near a dispensary.
The other bills being considered include one that would expand New Jersey’s existing medical cannabis program, permitting patients to possess up to three ounces of cannabis instead of the current maximum of two, as well as allow edibles and improve the licensing process for businesses.
The final bill called for the development of a system to expedite the expungement of low-level cannabis offenses and reducing the waiting period from ten years to just five.
Sticking Points, Governor Murphy vs. Lawmakers
Despite everyone being on the same page regarding the legalization of adult use cannabis in New Jersey, there are two points of contention that apparently prevented the bill’s passage before the close of 2018.
One area that will require compromise is the tax rate on cannabis sales. While the current bill sets it at 12%, Governor Murphy has suggested an excise tax of 25% which is more in line with other states such as Washington where sales tax is 37% and Colorado where there is a 15% excise tax and 15% sales tax.
The proposal is opposed by both State Senate President Stephen Sweeney and State Assembly Speaker Craig Coughlin. While both lawmakers support legalization, Sweeney has stated that he wants the tax rate to be kept low in order to prevent people from returning to the black market due to high prices.
In addition, both sides have differing opinions on whether or not a Cannabis Regulatory Commission is needed full-time. Governor Murphy is against it, Sweeney is for it, and the bill calls for an assessment three years after implementation to make a determination regarding the necessity of full-time.
If all of these issues can be worked out and the bills passed in 2019, New Jersey will be the first state to launch a legal, adult use cannabis market without a ballot initiative. While Vermont’s legislature made it legal for adults to grow, possess and consume cannabis, it’s yet to establish a fully regulated industry for cultivation, production and sales.
Of course, Medicine Man Technologies will be here to give you the latest updates on adult use cannabis in New Jersey. So, please stay tuned.
If you wish to start your own legal enterprise in the U.S. or anywhere across the globe, please contact us for private consulting, as well as help with licensing, cultivating, dispensary operations and more.