Dozens of supporters, opponents and on-lookers crowded the New Jersey State House on March 25, 2019, waiting for a final, planned vote on Senate Bill 2703 (S2703). The bill, sponsored by Senate President Stephen Sweeney and Senator Nicholas Scutari, would have legalized use and possession of marijuana for persons over the age of 21 and created the Cannabis Regulatory Commission to oversee the program. Instead, S2703 was pulled from the planned vote, lacking the votes required to meet the 21-vote threshold required for approval. Similar efforts in May and the fall of 2019 failed, so the Legislature moved for the next available option—amending the New Jersey Constitution by a referendum on the November 2020 election ballot to permit adult use of marijuana.

On Nov. 18, 2019, the Senate introduced Senate Concurrent Resolution No. 183 (SCR183) to "amend Article IV, Section VII of the New Jersey Constitution." Article IV, Section VII governs the New Jersey Legislature and was last amended on Dec. 7, 2000, to permit the public disclosure of details about sex offenders, and again on Dec. 5, 2013, to permit sports wagering (N.J. Const., Art. IV., Section VII, Para. 12, Para. 2). SCR183 proposes, at Section 13) that New Jersey voters add a new paragraph 13, stating that:

The growth, cultivation, processing, manufacturing, preparing, packaging, transferring, and retail purchasing and consumption of cannabis, or products created from or which include cannabis, by persons 21 years of age or older, and not by persons under 21 years of age, shall be lawful and subject to regulation by the Cannabis Regulatory Commission created by [N.J.S.A. 24:6-I et al.], or any successor to that commission.

This new section would also authorize the Legislature to enable the Cannabis Regulatory Commission to regulate the program, to tax sales of adult-use cannabis under the Sales and Use Tax Act, and permit municipalities to adopt municipal taxes not to exceed 2% on the "sale, or any other transfer, of cannabis or products created from or which include cannabis …." (SCR183 at Section 13(1), (2)). The Legislature also expressly reserved the right to draft and adopt "anticipatory" legislation needed to "effectuate the provisions of the amendment."

Article IX of the New Jersey Constitution provides that a concurrent resolution to amend the Constitution must be passed by three-fifths of the Senate and Assembly within the same year to refer the amendment to the voters (N.J. Const., Art. IX, Section 1). The Governor's signature is not required on a concurrent resolution to place a constitutional amendment on the ballot. On Dec. 16, 2019, the Assembly voted 49–24, and the Senate voted 24–16, exceeding the required three-fifths or 60% threshold, and placing the matter on the November 2020 ballot (Roll Calls available at New Jersey Legislature https://www.njleg.state.nj.us/).

To adopt this proposed amendment, New Jersey voters will be asked the following question:

Do you approve amending the Constitution to legalize a controlled form of marijuana called "cannabis"? Only adults at least 21 years of age could use cannabis. The State's commission created to oversee the State's medical cannabis program would also oversee the new, personal use cannabis market. Cannabis products would be subject to the State sales tax. If authorized by the Legislature, a municipality may pass a local ordinance to charge a local tax on cannabis products. (SCR183 at page 4.)

Monmouth University polling published on Feb. 18, 2019, suggests that "[m]ost New Jersey adults (62%) currently support legalizing the possession of small amounts of marijuana for personal use." For this reason, the proposed constitutional amendment is widely expected to be adopted. Such a vote, however, would not immediately create access for New Jersey adults over the age of 21 to legally possess cannabis after Jan. 1, 2020. The New Jersey Legislature and the new Cannabis Regulatory Commission (the "Commission") would be required to set rules for the program.

Once it became apparent in the spring of 2019 that S2703 would not pass, the Legislature moved in June 2019 to pass a related bill intended to expand the medical marijuana program in New Jersey to address problems identified in a Department of Health report issued at Governor Murphy's request. Earlier versions of Assembly Bill 20 had left licensing, taxes and the structure of the expanded medical and adult-use cannabis program to S2703, which would have created the Commission. Anticipating the need for the Commission should a referendum pass, the Legislature moved the Commission's authority, as well as the rules for licensing and taxing (and a host of other provisions) from S2703 into A20, but limiting the Commission's purview to medical cannabis. A20—also known as the Jake Honig Law—passed with bipartisan support and was signed into law on July 2, 2019.

Because A20 borrowed so heavily from S2703 in creating the Commission and the framework for an adult use market, there are just a handful of key provisions required to carry out the mandate of the referendum. The definition of "cannabis" set forth in the Jake Honig Law, the New Jersey Criminal Code, Title 2C and the New Jersey Controlled Substances Act would have to be amended to exclude from the definition "cannabis" that is grown, manufactured and possessed in accordance with the constitutional amendment. Similarly, the Legislature could look to the state excise tax provisions of S2703, which placed taxes on the transfer of cannabis from cultivators to any other licensed cannabis business.

In addition to these legislative additions required to implement the amendment, there is another significant practical requirement. Despite the fact that the Jake Honig Law required the Commission to be appointed by the Governor and Legislature leadership, no Commission members have been appointed since the date of the law. Consequently, the Commission has already missed the statutory deadline of Dec. 29, 2019, to adopt rules and regulations for the medical marijuana program, and thus has failed to issue a request for new licenses required within 90 days of those new rules and regulations (N.J.S.A. 24:6I-16, -7.1). Given the status of the Commission and the current lack of "anticipatory" legislation for the amendment, there is still a significant list of actions needed before adult-use cannabis reaches New Jersey consumers.

Lisa Gora is an attorney at Wilentz, Goldman & Spitzer in Woodbridge, who practices on the Cannabis Law, Health Law and Corporate teams. She also serves as secretary of the NJSBA's Cannabis Law Committee. Seth R. Tipton is a partner at Florio Perrucci Steinhardt & Cappelli in Phillipsburg, who chairs the firm's Cannabis Law and Corporate Law practices. He also serves as co-chair of the NJSBA's Cannabis Law Committee.