Lower Preps for Legal Marijuana Sales

VILLAS – According to Lower Township Councilman Thomas Conrad, legalization of the recreational use of marijuana in the State of New Jersey is likely to occur in the foreseeable future. 
Conrad briefly mentioned that possibility at the Nov. 20 council meeting as a result of his attendance at the recent New Jersey State League of Municipalities conference in November.
Conrad recommended that the municipality begin planning for the possibility that retail outlets would be created in the township that would require zoning action in the event that a bill is passed and signed by incoming Governor-elect Phil Murphy.
To that end, the council approved sending a letter to the Lower Township Zoning Board that asks that it begin developing ideas on how to manage the process should the legal use of marijuana become law.
N.J. Senate Bill 3195 introduced by State Sen. Nicholas Scutari (D-22) in May 2017 would legalize the possession and personal use of small amounts of marijuana for persons aged 21 or older.
A companion Assembly Bill A-4872 was introduced by Assemblymen Reed Gusciora (D-15) and James Kennedy (D-22) in May that mirrors the provisions contained in the Senate bill.
Both bills have been referred to their respective Judiciary Committees for further action. Although the legalization of marijuana promises to test the boundaries of what many people believe is a disturbing trend of drug use in this society, other states have had some experience with defining and managing those social and legal boundaries.
Although legalization or decriminalization of cannabis in New Jersey is likely more than a year away at the earliest, a look at Colorado’s experience with legalization, as well as the provisions of the NJ Senate and Assembly bills that are pending, might provide insight into the future of recreational marijuana use locally.
Proposed State Law
The provisions found in the New Jersey law closely replicate the Colorado law in many respects. The New Jersey Senate bill defines the intent of legalization to be a “new approach” to marijuana policies.
It seeks to re-direct money from the illegal sale of cannabis away from drug gangs and cartels and funnel that money, through tax revenue that is projected to be hundreds of millions annually, towards preventive measures such as education and therapy/rehabilitation services.
New Jersey would create a new Division of Marijuana Enforcement within the Department of Law and Public Safety to administer and enforce the new laws and regulations.
That division would set fees, control retailers including placing limits on signage and advertising media. The bill provides that there should be at least one retailer in each county, the maximum number of retailers permitted in each county would be determined by population and other factors.
The division would also set standards regarding how close to schools and other public buildings retailers may operate. Municipalities would be able to control hours of operation, establish civil penalties, and process applications for licenses.
Excise tax revenue from the sale and manufacture of cannabis would be earmarked to fund the expenses of the new Division of Marijuana Enforcement.
In year one of enactment, 1 percent of the tax revenue would go to the municipality. In year two, 2 percent would be returned locally, and in year three, 3 percent would be returned.
Proposed tax rates for licensed operators in year one of enactment would be 7 percent. In each succeeding year, the tax rate increases by 5 percent which means that after five years, the excise tax would be capped at 25 percent. There are some differences in approach and use of revenue in the Colorado law.
Colorado’s Experience
In 2012, Colorado began the most high-profile legalization of recreational cannabis in the nation when it passed Amendment 64. The law became effective more than a year after initial enactment. In summary, that law permits the possession and use of small amounts of marijuana, although it prohibits public or open use of the product.
One ounce of marijuana is considered legal to possess for recreational use by persons 21 years of age; persons are permitted to grow no more than six plants for personal use.
Retail outlets are licensed and their hours of operations are limited; Colorado allows municipalities to decide if they want retail sales to occur in their counties and cities, and they are generally permitted to regulate sales as they see fit as long as they do not supersede state law.
Each municipality enacts its own ordinance to codify local regulations.  Retailers, cultivators, transporters, and processors are licensed and regulated, but in a more decentralized manner as compared to the proposed New Jersey bill being considered.
Colorado also established new driving under the influence standards; the legal blood level limit is 5 nanograms of cannabis per milliliter of blood.
Retail sales are taxed at a 2.9 percent state sales tax, plus any local taxes imposed by the ordinance enacted in each municipality; an additional special 10 percent tax is also levied at the state level.
The first $40 million raised through taxes is earmarked for school capital construction.
According to various campaign sources, Murphy wants to sign legislation to legalize the recreational use of cannabis within 100 days of taking office with the intent to use the estimated $300 million in tax revenue to fund public education and worker pension costs.
To contact Jim McCarty, email jmccarty@cmcherald.com.