Why is There Still a Delay in Legalizing Recreational Cannabis?

More than likely, you know that part of the current administration’s platform was the legalization of recreational cannabis. Although it was anticipated that legislation would be in place by the end of 2018, it doesn’t appear that it will actually occur as planned. However, that’s not to say it won’t happen in 2019.

In the meantime, New Jersey’s medical marijuana program expansion is imminent. A recent news article reports that six additional dispensaries are set to open. This doubles the current number from six to twelve places where eligible patients can arrange to purchase medical cannabis. The new facilities will open for business in the following locations:

• Atlantic City (only a dispensary)
• Elizabeth (solely a dispensary)
• Ewing
• Galloway (restricted to a cultivation facility)
• Paterson
• Phillipsburg
• Rahway (limited to a grow facility alone)
• Vineland

Although there are eight separate premises, they represent the six companies selected from the 146 groups who actually applied to do business providing medical marijuana in the state of New Jersey.

The obvious question remains. The State has not approved medical cannabis for all conditions. And, yes – some are looking to use weed on a recreational basis. What’s the hold-up? This information is critical if you’re contemplating a future business in legally selling marijuana.

Recreational Cannabis in New Jersey

First things first. It does appear that New Jersey’s power brokers are all in favor of recreational cannabis. It’s not just Senator Nicholas Scutari who’s advocating for legalization.  He is joined by Governor Phil Murphy, Senate President Steve Sweeney, and Assemblyman Craig Coughlin. Although some would prefer the ability to grow pot at home, that seems out of the question.

So, what’s the hold-up? Taxes. Taxes. Taxes. Just about everyone claims that New Jersey loves to tax everything. As it now stands, medical marijuana is highly taxed in the state. So, how will this work when recreational cannabis becomes available?

First, you may be aware that many municipalities have already decided that they don’t want facilities in their town. Meanwhile, those that do have their own thoughts. One newspaper article provides the opinions of mayors looking forward to expanding marijuana availability. They feel an excise tax of two percent isn’t nearly enough.  Instead, they are advocating for five percent.

Regulatory Commission

There’s a further consideration regarding the hold-up in legalizing recreational cannabis. There are currently plans to create a regulatory commission that would fall under the auspices of the Department of Treasury, but still act independently.  It will take some time to work out the details.

Starting a Cannabis Business

Those interested in starting a cannabis business will most definitely need legal guidance. Obviously, the first step involves the application process. However, if the legislation passes in its current form, here’s something you should know:

• Cannabis business owners must hire employees affiliated with labor unions
• Ten percent of licenses will be allocated to small business owners
• A percentage of prospective businesses will be reserved for “economically disadvantaged communities.’

You should know that there are other nuances that are important to consider if you are thinking of starting a cannabis business.

Contact Us

At the Law Offices of Anthony Carbone, we recognize that the legalization of recreational marijuana is an upcoming business opportunity. Have questions?  Give us a call.