On Monday, New Mexico became the 17th state alongside D.C. to legalize a recreational marijuana program after Gov. Michelle Lujan Grisham signed the legislation into law. Touted as a law that will not only create jobs and boost state revenue but also put an end to social injustices surrounding the criminalization of marijuana, the new law will allow legal recreational sales to begin in April of 2022.
Throughout the legislative process, Gov. Grisham has argued that legalization would help communities that have been negatively impacted by tough policing in regards to cannabis drug violations. On Monday, she touched on those concerns that surround disproportionately created harm for racial and ethnic minorities through drug criminalization and tougher policing. She noted that the new law could free up to 100 prisoners and expunge criminal records for thousands of other residents.
“It is good for workers. It is good for entrepreneurs. It is good for consumers,” the governor reiterated. “And it brings about social justice in ways in which we have been talking about and advocating for, for decades.”
The bill allows for the governor to have some authority over recreational cannabis in the state by giving her the power to appoint the superintendent of the Regulation and Licensing Department, which will oversee the distribution of licenses to dispensaries as well as make sure vendors are following the laws set forth under the bill.
People 21 years of age and over will be allowed to grow at least 6 pot plants at home, 12 per household, and possess up to 2 ounces (57 grams) of cannabis beginning June 29 according to Agency Superintendent Linda Trujillo.
With recreational cannabis sales at state-licensed dispensaries set to begin by April 1 of 2022, Gov. Grisham also emphasized on Monday that licensed cannabis farmers could begin scaling up production several months ahead of time. This measure is intended to help the developing recreational market keep up with the inevitable demand of next year’s sales.
Included in the array of legislative measures that passed is an initial excise tax of 12 percent on recreational cannabis sales that eventually would increase to 18 percent by 2030. This tax would be in addition to a current gross receipts tax on sales that ranges from 5% to 9% annually.
Taxes on medical marijuana will be waived to make sure patients in need are not hurt by the potential cost increase of products as a result of the new legislation. Regulators must also decide how much cannabis the industry will need to set aside for patients that qualify for medical marijuana. Regulators will face additional obstacles ahead.
Specifically, state regulators will need to handle the pending influx of applications for a variety of business licenses this upcoming September. Among the licenses the department needs to sort through are product testing labs, dispensaries, and industrial grow operations as well as “microbusinesses”, both of which will be allowed to grow, refine, package, and sell marijuana products. So-called microbusinesses will only be permitted to grow up to 200 plants.
State regulators will also have to deal with expressed concerns from residents of smaller towns, especially along the Texas border, that have seen many cannabis dispensaries trying to lay the groundwork to open operations for marijuana tourism. Though local governments cannot prohibit businesses from establishing store fronts, they have a voice in where businesses will be located and what hours of operation can exist through zoning regulations.
And learning lessons from fluctuations in marijuana supplies and prices in other states that have legalized, regulators in New Mexico will have the ability to put a cap on cannabis cultivation quantities as well as impose a $50 fee per plant each year if deemed necessary.
The Long Road to Legalization of Cannabis in New Mexico
While the legalization of marijuana in New Mexico is not a new idea, it has taken some time to push the legislation through. It seemed the path was much clearer, however, after New Mexico voters unseated several incumbent state senators that opposed legalization in the 2020 Democratic primary. With much of the opposition to legalization ousted, bills for pot legalization were finally given priority.
Legislators mobilized around several new proposals, with legislative framework from Rep. Javier Martinez of Albuquerque receiving particular attention due to its focus on social justice and automated procedures for expunging past marijuana convictions.
Rep. Martinez hopes the newest state to pass legalization will encourage the federal government to take a long look at the law and consider it a potential template for federal legalization. “I grew up along the border. I’ve seen what the war on drugs has done,” Martinez stated. “I’m proud that New Mexico – little old New Mexico – has dones its part to tell the federal government once and for all to legalize cannabis for the people.”
But the passing of this legislation was also due to Gov. Grisham’s commitment to get this bill through both chambers. The governor had to call a special legislative session to iron out details of the final bill in late March after legalization efforts wavered in the state Senate.
Not all lawmakers supported the legislation. Notably, Republican legislators were absent from the signing ceremony as the bill was passed along partisan lines. But, credit was given to Republican State Senator Cliff Pirtle for his influence in emphasizing free markets and public safety in a competing bill.
Another key point that many lawmakers wanted to emphasize in the cannabis legislation was the inclusion of a provision that addressed the rights of tribal nations. The new law will allow the state to create agreements with Native American tribal governments that would allow the cannabis industry to be accessible to these nations.
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