Lawmakers in New Jersey advanced amended legislation on Thursday to enact a regulated marijuana market in the state, although new differences between Assembly and Senate versions of the proposal mean that further negotiations will be needed before anything can be enacted.
More than two-thirds of New Jersey voters passed a referendum on Election Day to legalize cannabis for adults, but state lawmakers still have to pass legislation to establish rules for the new system before legal sales can begin.
The enabling measures, S21 and A21, were introduced just days after state voters overwhelmingly passed the constitutional amendment to legalize marijuana. Lawmakers have pushed to pass the legislation as soon as possible to ensure regulations are in place when legalization takes effect on January 1 of next year.
“We’ve got to get this done by the end of the year,” the legislation’s lead sponsor, Sen. Nick Scutari (D), said at the Assembly panel hearing. “If we don’t, we’re going to run into a myriad of other problems.”
The vote in the Assembly Appropriations Committee was 7 to 4, although some who voted yes acknowledged that the bill needs additional revisions. At a hearing later in the evening, the Senate Budget and Appropriations Committee approved its own version of the bill in an 8-to-3 vote.
Because lawmakers in each chamber have now added different amendments to their versions of the legislation, Assembly and Senate leaders will need to get to work reconciling the bills.
“Our language will be different than what the Assembly has,” said Sen. Paul Sarlo (D), chair of the Senate Budget and Appropriations Committee, “which will allow us to negotiate.”
The legislation was scheduled for final floor votes in both legislative chambers on Monday, but those plans have now been delayed as bicameral negotiations proceed.
"This is not a discussion of if, this is a discussion of how the mechanism will be fine tuned," says John Burzichelli during today's appropriations hearing on adult-use cannabis in New Jersey. pic.twitter.com/ytkfXrYLGG
— NJ Assembly Democrats (@njassemblydems) November 19, 2020
As lawmakers scramble to pass enabling legislation, controversies over tax and social equity provisions are already slowing its progress. The budget committees were supposed to consider the bills last week after they were approved by other panels, but lawmakers deferred the votes due to disagreements over details.
Since then, amendments have been added to the bill that supporters say would better address social justice advocates’ concerns. The changes add an excise tax to marijuana at the cultivation level on top of the state’s regular sales tax, and lift a cap on the number of cultivation licenses available, from 28 to 37.
A newly amended version of the Senate’s bill, meanwhile, would remove the cap on licenses completely. The differences mean the two bills will need to go to a conference committee where lawmakers can craft a compromise.
Caps make it almost impossible for equity candidates – people + families impacted by prohibition – to thrive in the new industry.
Caps also drastically reduce funds collected from taxes on legal cannabis sales that could be reinvested into communities harmed by the War on Drugs.
— ACLU of New Jersey (@ACLUNJ) November 19, 2020
On Thursday, equity advocates said the Assembly’s changes did little to meaningfully address their concerns. They noted that the language of the proposed amendments wasn’t available to the public ahead of the committee meetings.
Amendments being considered by the Senate panel weren’t made available before the Thursday meeting, either. More than two hours after the meeting was set to begin, lawmakers and commenters were still waiting on the proposed changes to be delivered.
Critics urged lawmakers to slow down and reflect on the measure’s details rather than push forward with a flawed bill.
“Even if the bill does not pass right now in its current form, the sky will not fall,” Tauhid Chappell, a journalist and medical marijuana patient, said during public comment. He urged lawmakers to add a provision that would funnel 30 percent of the program’s tax revenue to equity measures, including workforce training and interest-free loans to residents from communities negatively affected by the drug war.
Tax revenue under the current bill would fund education in the state as well as local police department training. The added excise tax could help fund social equity, but critics say it’s not clear that will happen under the legislation as written.
“Today’s amended cannabis legalization bill includes an extremely important step forward: a social equity excise tax that will fund financial reparations for communities of color devastated by the drug war,” the Rev. Charles Boyer, a pastor at the Bethel African Methodist Episcopal Church in Woodbury, NJ, said in a statement. “But there are serious concerns that have yet to be addressed. This bill still lacks firm, codified language that guarantees that funding from the excise tax is reliably allocated with real community input to the state’s impact zones.”
Other commenters echoed the complaint that the measure as written would insufficiently address the historical disparities of the drug war. Though the measure would reserve 15 percent of licenses for minority-owned businesses and another 15 percent for women or veterans, most commenters on Thursday said that wasn’t enough.
"The people of New Jersey are looking for a better way forward," says @AnnetteQuijano during today's hearing on adult-use cannabis. "One that embraces the hope and opportunity that a legal and regulated cannabis market can bring to our state." pic.twitter.com/kMoocvXbVI
— NJ Assembly Democrats (@njassemblydems) November 19, 2020
Many called for lawmakers to remove the cap on cultivation licenses entirely to ensure a sufficient supply of legal cannabis—the state has recently struggled with shortages in the medical system—and enable small businesses to more easily secure licenses.
Replying to those testifying, Rep. John Burzichelli (D), who chairs the Assembly Appropriations Committee, noted that the bill, even if it passes, isn’t necessarily final. It could be amended even after becoming law. “As we bring this to life,” he said, “that doesn’t mean this is the final version forever and ever.”
Many of the same issues came up during the Senate panel hearing later Thursday, although considerably more discussion focused on workplace protections for marijuana consumers and rules on employee drug testing. The bill is designed to allow employees to use cannabis while away from work, but some officials have worried that could open the door to workers being high on the job.
The disagreements on cannabis tax issues are familiar disputes that played out the last time lawmakers unsuccessfully attempted to enact the reform legislatively before giving up and referring the issue to voters via the ballot referendum.
Commenters also complained that the New Jersey bill would keep home cannabis cultivation illegal despite most other states allowing homegrow. Scutari replied that while he personally supports homegrow, allowing adults to grow cannabis at home would be difficult to police to ensure people aren’t growing too much or selling it on the illegal market.
“Personally, yes, I believe that’s something that’s the future for New Jersey,” he said. But in other legal states, he claimed, homegrow has caused problems. “That stuff found its way into the illicit market, competing with the regulated market, or in other instances [was] baled up and sent to jurisdiction that don’t allow for marijuana.”
Other lawmakers complained Thursday that the legalization bill is getting too convoluted. “We’re making it too complicated, too overregulated, and overtaxed,” said Sen. Declan O’Scanlon Jr. (R) at Thursday’s Senate hearing.
As debate continues on the legalization bill, New Jersey lawmakers are moving forward on separate decriminalization legislation that would eliminate criminal and civil penalties for up to six ounces of marijuana. That bill became more controversial, however, after the addition of an amendment that would also lower penalties for possession of psilocybin mushrooms. The Senate approved the proposal earlier this week, but the Assembly canceled planned floor consideration and has not yet rescheduled it.
Sen. Linda Greenstein (D) at Thursday’s hearing urged colleagues to move the decriminalization measure across the finish line before adopting legalization regulations, though nevertheless voted to advance the legalization bill to the full Senate floor.
Meanwhile, Gov. Phil Murphy has begun to assemble the state’s Cannabis Regulatory Commission (CRC), which will oversee the legal industry. The governor recently appointed Dianna Houenou, a current administration staffer and former policy counsel to the ACLU of New Jersey, to head the regulatory agency.
Until legal sales are up and running, New Jersey Attorney General Gurbir Grewal (D) is encouraging police and prosecutors to exercise discretion around marijuana offenses.