There is a race underway to legalize marijuana in the northeast
With pot shops already open for business in Massachusetts, entrepreneurs and politicians alike all along the length of the Boston-Washington corridor are racing to put legal marijuana regimes in place as fast as they can. No one wants to be the last island of prohibition as the green gold rush promises fortunes to be made and tax revenues to be collected.
After all, the Boston-Washington corridor, also known as the Northeast megalopolis, is home to more than 50 million people, and a healthy number of them are going to want to get their hands on legal marijuana products. And even though state laws typically forbid transferring legal weed between states, no one believes people from New Jersey are not going to cross the river into New York to score legal weed there and take it back home with them (or vice versa), or that people from Rhode Island and New Hampshire aren’t already scoring their personal stashes in Massachusetts.
Democratic governors and legislative majorities in both New Jersey and New York are both strongly pushing for legalization right now. While New Jersey has a year-long head start on its neighbor, and although Gov. Phil Murphy vowed to legalize within 100 days of his inauguration a year ago, it still hasn’t happened.
Murphy used his second inaugural address to renew his call for legalization, but he and legislative leaders remain deadlocked over how and how much to tax legal marijuana sales. Senate President Stephen Sweeney doesn’t want to go higher than a 12 percent excise tax, while Murphy has said he wants a rate double that.
A new proposal could break the stalemate—and provide some revenue and price stability in a sometimes fluctuating market. Instead of imposing an excise tax on retail sales, the idea is to tax marijuana by weight. Whether the retail price is $300 an ounce or drops to $150 an ounce, the tax by weight would remain the same, while with an excise tax on sales, a price drop by half would result in a tax revenue reduction by half.
While they’re squabbling in Trenton, they’re getting off to a fast start in Albany. Having seen the light while faced with pro-legalization challenger Cynthia Nixon last year, Gov. Andrew Cuomo reversed his anti-reform stance and is now foursquare behind legalization. He even used his inaugural address to highlight his support for it.
A few days later, Cuomo unveiled his legalization plan. He called for a 22 percent tax on wholesale sales and a per-gram tax on growers, which he estimated would generate $300 million a year in tax revenues by 2023. His plan would also set up licensing programs for growers, distributors, and retailers, with growers barred from opening retail shops. The plan would allow cities and counties the option of banning marijuana sales in their jurisdictions. Cuomo also vowed to institute expungement for past pot possession convictions.
With both houses of the legislature now controlled by Democrats, marijuana reform should move quickly this year, but there are bound to be some hiccups. Look for squabbles over taxation and local opt-out options that will need to be resolved, as well as intense efforts to ensure equal opportunity and racial justice. Still, the state is well-placed to get it done this year.
New Jersey and New York are the big ones to watch, but every other state in the Northeast that hasn’t yet gotten around to legalizing marijuana is also working on it this year. In Connecticut, Democratic Gov. Ned Lamont made legalization a legislative priority, House Speaker Joe Aresimowicz (D) is down with it, and a legalization bill has already been filed. Next door in Rhode Island, Democratic Gov. Gina Raimondo has now proposed marijuana legalization, not so much because she’s a fan of it, but because she can read the writing on the wall.
Even Vermont, which became the first state to legalize pot via the legislature last year, but only legalized personal possession and cultivation—not sales—is now preparing to take the next step and allow legal marijuana commerce. The Senate Judiciary Committee is planning to introduce a bill that would do just that. This bill would tax sales at 10 percent, with a 1 percent local option tax. The state’s Marijuana Advisory Commission had recommended a 26 percent tax and funneling much of the tax revenues into the departments of public safety and health to pay for new enforcement and prevention efforts, but Judiciary Committee Chair Sen. Dick Sears (D-Bennington) wants the revenues to go into the general fund. He says the bill could pass the Senate within a month, but it faces a rockier path in the House.
Similarly, Washington, D.C., which legalized possession and cultivation in 2014, is also moving toward full, commercial legalization. Councilmember David Grosso (I) has reintroduced the Marijuana Legalization and Regulation Act, and with Democrats now in control of the House, the Republicans won’t be able to block it if it passes.
Likewise, legislators in Delaware, Maryland, New Hampshire, and Pennsylvania will be taking up marijuana legalization this year, too. The entire Northeast is on the verge of legalization; the only real question is who gets there first and who is able to reap the benefits.
This article was produced by Drug Reporter, a project of the Independent Media Institute.