N.J. lawmakers OK bills to create legal marijuana industry and approve bill to stop weed arrests

New Jersey legislators approved three bills Thursday that radically change how the state approaches drug use involving marijuana.

The state’s Senate and Assembly voted first to create a new and legal marijuana industry from scratch and called for new regulations to be written within six months.

Both houses also approved a bill that decriminalizes possession of up to six ounces of cannabis. That second bill is designed to stop arrests and expunge criminal records of low-level marijuana offenses.

The third bill, meanwhile, will reduce penalties for possessing psilocybin, also known as magic mushrooms, from a felony charge to a disorderly persons offense.

“This is an historic day, the culmination of years of work,” said Amol Sinha, executive director of the ACLU of New Jersey, on the vote to legalize marijuana for all adults. “The decriminalization bill is among the most progressive in the country.”

Gov. Phil Murphy, who campaigned on a platform to legalize marijuana, is expected sign the bills into law as soon as next week.

Voters on Nov. 3 overwhelmingly approved a constitutional amendment to legalize marijuana in the Garden State for all adults.

New Jersey is expected to save about $127 million per year on enforcement costs with the expected enactment of the new laws. None of the bills, however, addresses home cultivation of marijuana. Growing weed without a state-issued permit still can result in felony charges for gardeners or basement growers.

Though the bills passed with significant margins, some lawmakers in the Senate assailed the lack of measures in the bills to ensure greater social justice and reparations, while others said the measures were laden with too many regulations and taxes.

The session, held on a conference call because of the COVID-19 pandemic and several inches of snow on the ground, erupted at one point into a squall of insults and recriminations.

State Sen. Ronald L. Rice (D., Newark), who opposed the bill, angrily rebuked its sponsor, State Sen. Nick Scutari (D., Linden), for not including stronger social justice measures in the proposed law. The attack provoked a furious rebuttal from Scutari. As the two lawmakers yelled at each other over the phone lines, Senate President Steve Sweeney (D., Gloucester) threatened to mute both of the warring lawmakers.

“I’m the one who’s legalizing it so Black and brown people don’t get arrested and he’s hollering at me?” said Scutari, minutes after the historic vote. “He’s lucky I’m not Donald Trump. I’d have called him a loser.”

A study produced by the ACLU of New Jersey found Black and brown people were over three times more likely to be arrested for marijuana crimes than white people, even though they consume cannabis at similar rates.

Scutari, who also serves as a full-time Linden County prosecutor, called passage of the legalization the “greatest achievement of a career’s worth of work.”

“People now have the opportunity to get jobs and go to college who might not have been able to because they’d been arrested for marijuana in their younger years,” Scutari said. “It’s a significant accomplishment for New Jersey and is likely the most significant piece of legislation we’ve passed in my lifetime.”

The “New Jersey Cannabis Regulatory, Enforcement Assistance, and Marketplace Modernization Act” provides the blueprint to create a new business sector. Some industry experts believe it will create thousands of jobs and generate $2 billion in revenues a year.

The law will limit the number of growers for the first two years to a total of 37. The state currently has 12 medical marijuana facilities in operation. The law will distribute tax revenues to the communities with the most drug arrests and prosecutions. The law will give businesses the right to drug-test employees suspected of being intoxicated on the job.

The existing medical marijuana retailers will be allowed to be the first to switch over and sell cannabis to adult recreational consumers.

The Cannabis Regulatory Commission, under the Department of Treasury, will create and enforce statutes that will govern the state’s marijuana marketplace. Those regulations will be required to be done within the next six months.

“The bill leaves a lot of impactful decisions up to the CRC and sets up new licensing concepts that seek to address issues of systematic inequality,” said Ellie Siegel, CEO of Longview Strategic, a cannabis-industry consultancy. “Lawmakers are trying not to overburden the emerging industry with high costs and taxes, but until New Jersey gets plentiful products on shelves, the underground market will continue to dominate.”

Eventually, the state will issue “micro-permits” intended to provide opportunities for hundreds, if not thousands, of small businesses to participate in the industry.

“We don’t know yet how those micro-permits are going to break,” said Chris Goldstein, an organizer for NORML, the National Organization for the Reform of Marijuana Laws. “Right now the industry is set up to be run like a state-sponsored cartel. As soon as wholesale is available, the micro-permittees could purchase and sell it. That could be a while.”

The marijuana legislation was designed to eliminate the black market and replace it with a legal marketplace. But State Sen. M. Teresa Ruiz (D., Newark) doesn’t want to see “traditional” neighborhood weed dealers left behind.

“We’re going to pivot to make sure everyone has a pathway to participation,” said Ruiz, who also sponsored the decriminalization bill. That law provides expungement for most cannabis crimes. She believes that even Ed Forchion, the Garden State’s most notorious underground dealer, might find a place in the legal regime.

“We can’t launch a new economic frontier without being inclusive of those that the War on Drugs has hurt the most,” Ruiz said. “That’s why we went a long way to ensure funding returns to the communities that were hardest hit.”

Advocates, experts, and community leaders generally applauded the bills, though some voiced reservations.

“While our work to repair the damage done by the drug war is far from over, today is a moment for celebration,” said the Rev. Charles F. Boyer, pastor of Bethel A.M.E. Church in Woodbury. “Through this [legalization] bill, 70% of the sales tax revenue as well as an excise tax will be directly used to fund programming in communities most impacted by New Jersey’s drug war.”

One industry insider, who did not want to be identified, said limitations placed on weed businesses were “more restrictive than those on casinos and nuclear power plants.”

State Sen Declan O’Scanlon (R., Monmouth) decried the lack of a home-growing provision and lambasted the “overtaxation, overregulation, and over-complication” spelled out in the 247-page legalization bill.

“To be blunt, I had no choice but to vote no,” said O’Scanlon. “The fact that the tax structure prescribes — unconstitutionally — an excise tax (which is prohibited under the referendum) that can amount to a 60% tax rate, is a recipe for the perpetuation of the illicit market.”

Kevin Sabet, a former Obama administration adviser who cofounded Smart Approaches to Marijuana, was also pointed. “New Jersey’s marijuana market will not benefit people of color and other disenfranchised communities,” he said. ”Instead, it will continue the trend of the marijuana industry enriching mostly white men while expanding substance use disorders and predatory marketing in vulnerable communities.”

The founder of the CannaBusiness Association said there will be time and opportunity to fine-tune the regulations. Scott Rudder would have preferred to see lower barriers to entry for aspiring marijuana entrepreneurs.

“There’s nobody who’s walking away saying this is 100% right,” said Rudder, a former Republican assemblyman from Medford. “Every major stakeholder — whether on the social justice, industry, or patient side — is a little frustrated. But that’s what happens when you’re trying to end 83 years of cannabis prohibition.”