In case you have not seen it, we call your attention to the League’s September 12 Urgent Alert regarding the anticipated legalization of adult recreational use marijuana.
Since that alert went out, draft amendments to Senator Scutari’s bill have gone public but with one major difference than what we reported in our earlier email. The state tax rate in the bill is 10%, not the 25% that was being widely discussed and included in the legislation as introduced. The difference reflects the respective positions of the Legislative sponsors and the Murphy Administration and will be subject to further negotiations.
As we anticipated, the legislation allows a municipality to enact an up-to-2% local excise tax for local purposes. It also would give a municipality 180 days to “opt out” by passing an ordinance banning any commercial business associated with cannabis.
The League, working closely with the Urban Mayors Association (UMANJ) and the Conference of Mayors (NJCM), has communicated to the sponsors and the Murphy Administration that the local option should be up to 5%. Enforcement will fall almost entirely on municipal governments, which will need to absorb costs associated with law and code enforcement, health services, education, and social services. Two percent is simply insufficient to offset costs and is an incentive for municipalities to opt out. We based this conclusion on our conversations with dozens of Mayors across-the-state and based on our outreach to our fellow State leagues in states that have legalized recreational marijuana.
We note that the League, as well as the UMANJ and NJCM, has not taken a position on the larger legalization issue. But regardless of your position on legalization, there are inherent issues that will be confronted by local governments if and when cannabis is legalized and it is imperative to give municipalities as many tools sufficient to effectively deal with those issues. Thus, recognizing the likelihood of passage, most likely in October, we urge you to contact your Legislators and ask that if they support legalization they should also support a 5% local option and that municipalities should have the ability to “opt-in” instead of requiring what will likely be hundreds of municipalities to “opt out.”
Contact: Michael F. Cerra, Assistant Executive Director, firstname.lastname@example.org@njslom.orgorg, 609-695-3481, x120.