On September 12, the New Jersey Senate was set to vote on the expungement bill for cannabis convicts, which included changes suggested by Governor Phil Murphy. However, Senators Sandra Cunningham and Teresa Ruiz and Senate President Stephen Sweeney introduced new legislation, according to an NJ Advance Media article.
According to the article, the senators claimed that the new bill would broaden the eligibility of the convicts charged with marijuana-related crimes to seek expungement. Sweeney stated that because the Democrats did not have enough members on September 12, the bill was not cleared.
Cannabis legalization in New Jersey
Thusfar, New Jersey has legalized marijuana for medical purposes only. However, several attempts were previously made by the Democratic-led Senate to legalize recreational or adult-use marijuana.
In January 2010, Governor Jon Corzine signed the New Jersey Compassionate Use Medical Marijuana Act to legalize cannabis for patients with chronic illnesses. In July this year, Governor Phil Murphy signed the Jake Honig Compassionate Use Medical Cannabis Act, which expanded the access of medical cannabis for patients.
Moving to recreational cannabis, Senator Nicholas Scutari first introduced a bill to legalize adult-use cannabis in May 2017. However, then-Governor Chris Christie, who was against the legalization of marijuana, opposed it. In January 2018, Phil Murphy became the Governor of New Jersey. Despite Murphy being a supporter of the legalization of adult-use cannabis, the New Jersey Senate has been unable to legalize recreational marijuana. The Senate has also failed to implement legislation to expunge the records of people convicted of cannabis-related offenses. We feel that the September 12 development has further delayed the legalization of the adult-use cannabis process.
However, it looks like New Jersey residents are in favor of the legalization of recreational marijuana. In February 2019, Cannabis Business Executive reported that a Monmouth University poll indicated that 62% of adults were in support of a law allowing adults to use a small quantity of cannabis for recreation. The poll also suggested that 74% wanted to expunge the charges on convicts charged for possession of a small amount of marijuana.
Legalization in other states
At present, 11 states have legalized adult-use cannabis, and 33 states have allowed the usage of marijuana for medical purposes. Of the 11 states, Washington, Oregon, Colorado, Massachusetts, Nevada, California, Alaska, and Maine are already selling recreational cannabis. Illinois, Vermont, and Michigan have yet to start their recreational marijuana businesses. You can read more about the progress Michigan has made in recreational marijuana in Recreational Cannabis: How Is Michigan Shaping Up?
Legalization of cannabis has its challenges. In our article, Marijuana Policy: Can California Shape It for the US? you can see how the black market is thriving in California despite the legalization of adult-use cannabis. Washington, which had legalized recreational marijuana in 2012, is looking at revamping its cannabis laws.
Benefits of marijuana legalization
The legalization of recreational marijuana will help in the generation of tax revenue for the states and also create new jobs. In March 2019, an NJ Advance Media article reported that Governor Phil Murphy expects cannabis tax to generate $80 million in revenue for the state in the next year. The revenue includes $60 million from recreational cannabis and $20 million from medical marijuana.
Legalization will also help marijuana players expand their businesses. We can see how prominent cannabis players, such as Aurora Cannabis (ACB), Tilray (TLRY), and Canopy Growth (CGC) (WEED), are expanding their hemp business in the US since its legalization in December 2018.
Aurora Cannabis completed its acquisition of Hempco Food and Fiber last month. The company reported its fourth-quarter earnings results on September 11. For the quarter, Aurora missed its revenue guidance and analysts’ revenue expectations, which led to a fall in its stock price. You can read more about Aurora’s fourth-quarter performance in Aurora Cannabis Stock Fell Approximately 9%: Time to Buy?
In February, Tilray acquired Manitoba Harvest, which manufactures and sells hemp products, to expand its hemp business in the US. Tilray has lost more than 55% of its stock value this year due to a worse-than-expected performance in its second quarter.
Canopy Growth is planning to open a Hemp Industrial Park in New York and is conducting research on hemp and hemp derivatives at its Batavia facility in Illinois. The company also acquired AgriNextUSA in March. Canopy has returned 2.2% YTD. The company’s weak first-quarter performance led to a fall in its stock price.