This article has been saved to your Favorites!

NJ Voters Approve Pot Legalization At Ballot

By James Nani · November 3, 2020, 10:20 PM EST

New Jersey voters approved legalizing and taxing recreational marijuana for adult use Tuesday after lawmakers had put the question on the ballot last year when they failed to garner enough support to take the step on their own.

New Jersey voters' legalization of recreational marijuana came nearly two years after state legislators gave up on bills toward such an effort. (AP Photo/Dolores Ochoa)

As of late Tuesday, the question was approved 67.25% to 32.75% with nearly 58% of the votes reported. The question authorizes a state constitutional amendment legalizing cannabis for personal, nonmedical use for those 21 and older and allows a state commission overseeing New Jersey's medical cannabis program to have oversight of the recreational market as well.

The measure also makes cannabis products subject to state sales and use tax and gives the state Legislature authority to allow a municipality to pass a local ordinance charging a local tax of up to 2% on cannabis products. The state's current sales and use tax rate is 6.625%. The changes go into effect Jan. 1.

The question was put on the ballot after New Jersey's Legislature canceled expected votes in March 2019 because of a lack of support for bills that would have legalized and taxed cannabis for adults. The abrupt cancellation came after months of discussion among Democrats.

In December 2019, the state Senate and Assembly approved a resolution mostly among party lines to place the proposed constitutional amendment on the November ballot, setting off a race to sway public opinion on the issue.

In an online post after the race was called, Democratic Gov. Phil Murphy, who supported the measure, praised the question's passage as "a huge step forward for racial and social justice and our economy."

The Legislature's research office has said it can't quantify how much the tax will raise because there aren't enough details yet about how cannabis would be regulated. However, based on figures from Colorado, the office estimated New Jersey could raise $126 million annually once a market is established. The office noted that sales would be lower in the first few years and that estimates could change depending on the market and whether nearby states also legalize recreational cannabis.

Democrats supporting the measure in the Legislature had framed the issue as correcting social and legal injustices that have had a disproportionately negative impact on communities of color, while making cannabis regulated and safer.

Those criticizing the measure, including Republicans, argued that legalizing cannabis poses a danger for motorists as more drivers get behind the wheel while high. Organizations such as Don't Let NJ Go to Pot and Smart Approaches to Marijuana opposed the measure, arguing that cannabis would still get into the hands of minors and that legalization wouldn't solve systemic injustice and racism issues.

But NJ Can 2020, a coalition of groups, organized in favor of the measure, arguing that taxation and legalization would address harm caused by cannabis being illegal, including disproportionate arrests of people of color related to cannabis.

New Jersey has an existing medical marijuana program that is subject to the state's sales and use tax, though the state began phasing out that tax in July, decreasing the rate from 6.625% to 4%. The rate will decrease again after June 30, 2021, when it will drop to 2%, and the tax will be eliminated on July 1, 2022.

Amol Sinha, executive director of the ACLU of New Jersey, said in a statement that the question's passage is "the first step toward justice." He called on the Legislature to pass a bill to enable a "robust expungement of records" and to immediately decriminalize cannabis to stop arrests before legalization is fully put in place.

"After decades of waiting and hundreds of thousands of arrests, New Jerseyans can no longer wait," Sinha said.

New Jersey's measure was among several cannabis-related state measures on ballots Tuesday. Other measures appeared in Montana, Mississippi, South Dakota and Arizona.

--Additional reporting by Bill Wichert. Editing by Neil Cohen.

Update: This story has been updated with a statement from Sinha.

For a reprint of this article, please contact reprints@law360.com.