Last week, New Jersey citizens voted to legalize adult use recreational cannabis. The question on everyone’s mind is: what happens next?
On Friday, Senator Nick Scutari released a new bill that would establish the framework for legal cannabis in New Jersey. The bill is similar to the prior bills introduced by Sen. Scutari. The New Jersey legislature still has to review and pass the bill for signature by the Governor. Additionally, the Governor must finalize the New Jersey Cannabis Regulatory Commission to be the regulatory oversight body for cannabis in New Jersey. On Friday, the Governor made progress by making several top appointments to the Commission. Once finalized, the Cannabis Regulatory Commission will also have to promulgate regulations for the industry.
In the most significant decision to date in the medical marijuana context, the New Jersey Supreme Court recently confirmed that a plaintiff under the New Jersey Law Against Discrimination (“LAD”) can state a viable claim for discrimination related to lawful use of medical marijuana. On March 10, 2020, the Supreme Court in Wild v. Carriage Funeral Holdings, Inc. (A-91-18) affirmed the judgment of the New Jersey Appellate Division allowing a plaintiff’s LAD claim based on his allegation that he was terminated for lawful medical marijuana use to proceed to the merits.
In Wild, the plaintiff, a licensed funeral home director, alleged that he lawfully (and privately) used medical marijuana during non-work hours to treat his cancer. His employer learned that he was using medical marijuana and, as plaintiff alleges, terminated him without attempting to discuss an accommodation. The plaintiff filed a lawsuit alleging that his termination was unlawful disability discrimination under LAD. At the trial court level, the funeral home defendant filed a motion to dismiss, arguing that under the Compassionate Use Act (the statute allowing medical marijuana in New Jersey), N.J.S.A. 24:6I-14, employers were not required to accommodate an employee who used medical marijuana. The trial court agreed and dismissed the plaintiff’s LAD claim.
New Jersey’s efforts to legalize adult use recreational cannabis officially moved from legislative to electoral. Senator President Stephen Sweeney introduced a constitutional amendment regarding the legalization of adult use recreational cannabis that is expected to be on the ballot in the 2020 election.
If New Jersey voters approve of the amendment, it would take effect on January 1, 2021. The actual implementation of legalized adult use recreational cannabis, however, would take additional time. Similar to the anticipated process with respect legalization through legislation, this method would still require a state agency (the Cannabis Regulatory Commission) to be created, rules and regulations to be implemented and promulgated and license applications to be processed. In other states where this process has taken place, it took one to two years for dispensaries to officially open following the official legalization enactment.
On September 25, 2019, the U.S. House of Representatives passed H.R. 1595, the Secure and Fair Enforcement (SAFE) Banking Act. The legislation is intended to allow the cannabis industry to have access to financial services and to enhance public safety by reducing the industry’s reliance on cash. It provides a safe harbor for financial services companies, including banks, credit unions, and insurers, to serve cannabis-related businesses operating under state law without the threat of regulatory backlash or criminal prosecution.
The House voted 321 to 103 to pass the bill. The bill was supported in the House by 229 Democrats, 91 Republicans, and 1 Independent.
Despite the previously held belief that adult use recreational marijuana in New Jersey would have to await a ballot referendum in 2020, there is newfound optimism that a vote on legal cannabis may yet take place this year. Certain New Jersey lobbyists and industry leaders believe that the success of medical marijuana in New Jersey may prompt a vote on recreational adult use marijuana. Earlier this year, a recreational adult use marijuana bill cosponsored by Senators Nicholas Scutari and Steven Sweeney was pulled from a vote at the eleventh hour when legislative leadership determined that there were insufficient votes to get the bill passed. Thus, recreational cannabis in New Jersey will depend on two questions: 1) will a vote take place; and 2) if a vote takes place, will there be enough votes to get the law passed?
This blog will monitor all potential developments in the push for adult use recreational marijuana in New Jersey.
On Monday, the New Jersey Department of Health announced that it is seeking new applicants to operate 108 additional Alternative Treatment Centers – 38 in the northern region of New Jersey, 38 in the central region and 32 in the southern region. These licenses will include cultivation (24), manufacturing (30) and dispensaries (54). This is massive expansion of the medical cannabis program in New Jersey, which now has only twelve (12) ATCs licensed.
Application forms will be available on July 1, 2019 and will be due on August 15, 2019. The New Jersey Department of Health has published a Request for Applications that provides information for potential applicants.
Senate President Stephen Sweeney announced that the legislature is no longer pursuing cannabis legalization through the traditional legislative process. Instead, the issue of cannabis legalization will be put to a ballot measure in the 2020 election (which coincides with the next presidential election where voter turnout is supposed to be the highest).
Polling data still indicates that a majority of New Jerseyans support legalizing recreational cannabis. If that is borne out in the 2020 ballot measure, legal cannabis will be a reality in New Jersey – it may simply take more time than originally anticipated.
This blog will continue to track the developments of cannabis law in New Jersey.
As a recreational cannabis bill in the New Jersey legislature stalls, federal legislation directed at expanding the cannabis industry’s access to banking and insurance services advances in Congress. On March 28, 2019, the U.S. House of Representatives Committee on Financial Services approved H.R. 1595, the Secure and Fair Enforcement (SAFE) Banking Act. The bill was introduced to allow the cannabis industry to have access to financial services and to enhance public safety by reducing the industry’s reliance on cash. It provides a safe harbor for financial services companies, including banks, credit unions, and insurers, to serve cannabis-related businesses operating under state law without the threat of regulatory backlash or criminal prosecution.
On Monday, March 25, the New Jersey Legislature chose not to vote on the adult use cannabis legalization bill that has been the subject of debate for several years. The vote was delayed due to the lack of support for the bill. This is certainly a roadblock to adult use cannabis in New Jersey, but the efforts to legalize are not over. Legislators will continue to debate the merits of cannabis legalization in the hope that the outstanding assemblymen and senators will change their positions and vote in favor of cannabis the next time the bill is presented for a vote. Alternatively, the issue of cannabis legalization could be put to a ballot question, which would give New Jerseyans an opportunity to make their “voice heard.”
This blog will continue to follow all of the legalization efforts in New Jersey.
Earlier this week, Governor Phil Murphy, Senate President Steven Sweeney, Assembly Speaker Craig Coughlin, Senator Nicholas Scutari and Assemblywoman Annette Quijano jointly announced an agreement on the major outstanding issues for cannabis legalization: regulatory control and taxation. A new bill, that has not been publicly released, will be debated over the next two weeks in anticipation of a vote on March 25, 2019.