Marijuana Business Magazine - January 2017

TRENDS AND HOT TOP¬CS W ith November’s election of Democrat Phil Mur- phy as New Jersey’s next governor, the odds of the Garden State becoming the next to legalize adult-use cannabis practically went through the roof. During last year’s campaign, Murphy famously promised to legal- ize marijuana in his first 100 days in office. The state legislature – which is solidly Democratic – already has a potential bill lined up for him. The measure may or may not be what ends up getting passed by lawmakers in 2018. Regardless, the big takeaway from Murphy’s runaway victory is that New Jersey stands to become the first state in the nation New Jersey Rising? The Garden State could become a marijuana hub if governor-elect Phil Murphy legalizes adult-use cannabis – as he promised to do to legalize recreational cannabis through a legislature – as opposed to the ballot box. Lawmakers in many states have already passed medical marijuana legalization measures. Up until now, however, victories for recreational MJ have been achieved through popular vote, with activist groups taking their cases straight to voters instead of trying to finesse state lawmakers and gover- nors. Elected officials, meanwhile, have been more cautious – despite activists having predicted for years that state legislators in Rhode Island and Vermont were poised to legalize adult use. If rec in New Jersey does become a reality, it would be another milestone for the cannabis industry for three reasons: 1. The Domino Effect Other state legislatures could potentially follow suit. Politicians of all stripes are often cautious to endorse risky causes that might backfire with voters. But if New Jersey lawmakers pave the way, it’s possible other New England states could become emboldened and move ahead with rec legalization in 2018. That’s important. Only about half the states have a ballot measure process. The rest – including New Jersey and most of the eastern United States – must change laws through their legisla- tures. For that to happen with rec can- nabis, state lawmakers would, in effect, have to opt into the marijuana industry. 2. East Coast Marijuana Hub Depending on the legal framework, New Jersey could offer loads of busi- ness opportunities and potentially immense retail sales numbers – per- haps more than $1 billion a few years after the market launches – given its proximity to New York City and Philadelphia. And if state lawmakers craft indus- try regulations with an eye toward competing with nearby Massachu- setts, potentially through lower taxes or more retailers, New Jersey could become the biggest cannabis busi- ness hub east of the Mississippi River. 3. A New Brick in the Cannabis Wall Rec legalization in New Jersey could be yet another brick in the wall being built by legal states to protect the industry from federal interven- tion by the Department of Justice and Attorney General Jeff Sessions. The DOJ has not ripped up the Cole Memo or begun raiding state- licensed MJ businesses, at least not yet. One reason that hasn’t happened is arguably because several states – including California, Colorado, Nevada and Washington – have made it clear to Sessions and the Trump admin- istration that they would fight tooth and nail in court if the DOJ tried to interfere with their legal MJ programs. Murphy’s election means those states would have another ally ready to go to the mat. by John Schroyer Phil Murphy 34 • Marijuana Business Magazine • January 2018