Legalizing recreational cannabis use in New York and New Jersey would be a huge win for cannabis investors. Here’s where the Big Apple and the Garden State stand on the issue…
Cannabis legalization was a key issue for voters in the 2018 U.S. elections: Michigan legalized recreational use and Utah and Missouri legalized medical cannabis. That’s a good start, but the news gets even better – and bigger – in 2019.
New York and New Jersey, two of the most populous U.S. states, could be the next to legalize recreational cannabis.
Governor Andrew Cuomo (NY-D) expects his state could raise about $300 million in annual revenue from legalization. Governor Phil Murphy (NJ-D) also believes New Jersey could generate a similar amount of revenue, according to Bloomberg.
And it’s clear that residents of each state want legalization.
According to a 2018 Quinnipiac University poll, 63% of New York voters favor legalizing cannabis. For New Jersey, a 2018 poll by Rutgers University‘s Eagleton Center for Public Interest Polling found that 60% of New Jersey adults wanted legalization.
But if the majority of folks want this to happen, what’s the hold up?
Today, I wanted to give you an update on the legalization efforts in these two states.
The Big Apple and the Garden State could be huge cannabis markets, and companies expanding into New York and New Jersey could rake in massive profits…
New Jersey Pushes for Cannabis Legalization
New Jersey could be a big cannabis market, and state officials need to make sure they get legalization right.
They don’t want to end up like California, which expected $643 million in tax revenue from legal marijuana sales in 2018 but only hauled in $350 million. I’m going to have more details on that tomorrow in my Cannabis Profits Daily report.
To delve into the biggest issues a little further, the team at the National Institute for Cannabis Investors spoke with Juan Carlos Negrin, the President of the New Jersey Marijuana Retailers Association about where legalization stands in New Jersey. Here’s what he told us:
“There has been recent progress, but until the Governor’s (Phil Murphy) signature is on the bill, there is still work to be done on the legislation. The two biggest obstacles holding it up are oversight and pricing.
The issue of taxation had been one of the legislative hurdles separating the governor and the state legislature and this has recently been addressed with the proposed $42 excise tax on every ounce of marijuana sold, regardless of price. Additionally, establishing the framework for a committee to regulate cannabis caused progress to stall. One of the recent agreed-upon amendments to the measure allows Governor Murphy to have three direct appointments to the commission. The legislature will have the remaining two appointments to the committee. There are still some opposed and/or undecided in the legislature. If all parties can come together for a vote in March, cannabis could potentially be available in retail establishments in the first quarter of 2020.”
Similar issues are going on in New York – which would be a massive cannabis market – with debates over how much to tax cannabis and how to establish a legal framework for effective regulation.
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New York Marijuana Legalization
Cuomo is also focusing on trying to make the cannabis industry a level playing field for everyone.
“We have to do it in a way that creates an economic opportunity for poor communities and people who paid the price and not for rich corporations who are going to come in to make a buck,” Cuomo said in a speech.
There’s a strong incentive here, as any money coming out of legal cannabis in New York could do a lot of good. Cuomo wants to use revenue from legal sales to help fuel repairs for the Metropolitan Transportation Authority. The MTA has $41 billion in maintenance and upgrade needs, and $15 billion from cannabis taxes could be used to chip away at that enormous cost.
Both governors wanted to legalize marijuana within the first 100 days of their new term, and there’s a big incentive to be the first to reach legalization, as there will be a lot of tourist dollars on the line. In Colorado in 2017, visitors spent $287 million on cannabis tourism.
Last year I thought New Jersey would beat New York to the punch, but bureaucracy pushed both states into this year. I’m not sure who will be first this time around, but I am confident that once one of these states legalizes recreational cannabis, the other will follow in weeks, not months.
But no matter who is first, the most important thing is that they don’t over tax cannabis and send people to the black markets, where they could buy marijuana at much cheaper prices.
With the right frameworks, New York and New Jersey could be massive cannabis markets, and that’s only good news for your cannabis investments.
Thanks for being an important part of the National Institute for Cannabis Investors,
Executive Director, National Institute for Cannabis Investors
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7 responses to “Here’s What’s Happening with Cannabis Legalization in New York and New Jersey”
February 27 2019