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Recreational marijuana is now legal in New Jersey — and the governor who made it a reality is determined to make it work for the state’s financial coffers, as well as its historically disenfranchised residents.
Governor Phil Murphy signed three new laws after voters approved a ballot question in November to legalize adult weed use. The Garden State now joins at least a dozen others on the East Coast that are moving to legalize cannabis for recreational use, with more expected to follow suit.
“Will it create jobs, new businesses, revenue for the state? Absolutely, I’ll take all of that and we need it,” the Democrat told Yahoo! Finance Live this week.
The big move is expected to boost New Jersey’s economy — which was hammered by COVID-19 — by launching a for-profit cannabis industry that would generate millions of tax dollars for the state.
Murphy noted that retail outlets already sell cannabis for medical use, and will likely be the first to sell cannabis for recreational use within months. The state’s Cannabis Regulatory Commission (CRC) is establishing rules and regulations for sales in the state.
‘Address enormous social, racial injustice’
However, Murphy and many lawmakers have said their main goal for supporting legalized recreational marijuana was at least in part to correct historical wrongs. An ACLU analysis from 2018 New Jersey arrest data found that Black residents were arrested for marijuana possession at a rate 3.5 times higher than white residents, despite similar rates of usage.
“Most importantly, [legalization] is allowing us to address enormous social and racial injustices that have existed for far too long,” Murphy said.
The CRC will have to make decisions from advertising to quality control requirements, to how the application process is set up, and what fees might be required. Murphy expects the rules will be created with equity in mind.
“We want to most importantly get this right,” Murphy added. “That’s more important than the speed but both are objectives clearly.”
According to the language in New Jersey’s law, prioritization for licenses will be given to businesses located in areas known as “impacted zones” — cities that were “negatively impacted by past marijuana enterprises that contributed to higher concentrations of law enforcement activity, unemployment, and poverty,” Those areas have not been identified.
These zones are expected to see a higher share in tax revenue from weed sales, with 70% of taxes on retail sales from recreational marijuana designated to “impact zones” as grants, loans and other financial assistance.
The remainder of proceeds will be used to pay for the operating costs of the commission and reimbursements for towns, counties and the New Jersey State Police for training officers who can spot drivers impaired by drugs.
While Murphy’s push for the recreational-use cannabis industry came from a social justice lens, he said both can be achieved.
“There's no reason as the industry gets stood up, that we cannot have it both ways —that we cannot achieve equity in who gets the licenses where the retail establishments are located, and at the same time have a booming new sector to our economy,” he told Yahoo Finance.
“I'm extremely optimistic. We'll be able to have both. We must have the former. And I believe we will have the latter as well.”