It’s Really Happening….Maybe #NewJersey

Adult Use Cannabis is close in NJ, the home state of Safe-Reach and most of our team. Governor Murphy is seemingly doing his best to ensure the bill makes its way through the State Senate and Assembly on Monday, March 25, as of today (3/20) no one news source has presented any knowledge of where the vote will land.

If this bill doesn’t pass, NJ will be waiting until the fall of 2019 to pick up the conversation meaning summer 2020 legal cannabis. With our Neighbors in New York hovering above the legal cannabis issue, the Tri-State area could be on the verge of getting a lot more green.

Below are some spark notes (nice) on pending cannabis vote.

  1. Social Justice – A big part of the cannabis debate is how will social equity play into a “free market” system. Some groups are pushing for licenses and business opportunities to go first into areas that have been impacted by the war on drugs and cannabis convictions, historically minority and lower-income communities. The big driving point on the recently passed bill is a state executed expungement of prior convictions – helping adults who have low-level possession arrests and convictions.
  2. Tax – New Jersey is no stranger to piling on taxes on its residents and a major concern was an aggressive tax rate on rec and medicinal cannabis – too high of tax rate and the product becomes unaffordable to many and provides incentive to keep the black market afloat (look up California YOY sales correlation to Taxation.) The state has landed at a $42 per ounce tax with the notion as the scale of distribution increases and the cost of the plant goes down the state can maintain their tax revenue and the consumer still benefits from cheaper prices. Murphy has accounted for 60 million in Tax revenue off of adult use cannabis in 2020.
  3. Home Grow – This adult use bill would not allow for home grow a point of contention for many medical advocates who want to let patients grow their own medicine at home organically (and typically at a significantly lower price point than at retail.)
  4. Delivery – NJ would benefit from home delivery, expect to start seeing companies like Eaze work their way into the market. There are a few different models for the legalities on this here look at the polarity between Oregon and California as a good model of different approaches to regulating this space.
  5. Social Consumption Sites – There will be licenses for social consumption sites, retailers would be able to apply for a license to have consumption sites in a separate area but the same facility as their retail space.

If the vote passes Monday what’s next? The state has six months to lay out plans for the adult use and medicinal market – quantities, licenses, retailers, products, advertising… NJ residents and transients from the surrounding states could be buying legal cannabis by the fall of 2019.