Marijuana Legalization Has Other States Green With Envy

• Published date: 08 May 2021
• Subject Matter: Finance and Banking, Media, Telecoms, IT, Entertainment, Cannabis & Hemp, Financial Services, Advertising, Marketing & Branding
• Law Firm: Davis & Gilbert
• Author: Mr Gary Kibel and Louis P. Dilorenzo

New York became the 15th state to legalize recreational marijuana this March, following the lead of New Jersey and three other states where voters approved legalizing recreational marijuana this past November. In a year where states are seeking tax revenue wherever they can get it, this has set off a wave of similar legislation in other states where recreational use is expected to be legalized in the coming months.

Recreational Marijuana Legalizations

Up until 2012, recreational marijuana was illegal in all 50 states. In that year, Colorado and Washington legalized marijuana via ballot measures, becoming the first two states where recreational marijuana could be purchased legally. In the following years, a number of states modified their marijuana laws in various respects ' including by legalizing medical marijuana and decriminalizing recreational marijuana ' but relatively few states moved forward with legalizing recreational marijuana outright, with legalization efforts being mostly concentrated on the West Coast and New England.

However, legalization efforts dramatically increased following the 2020 November election. Four states ' New Jersey, Arizona, South Dakota and Montana ' chose to legalize marijuana via ballot initiative this past November. As expected, this development led to legalization efforts elsewhere for a few reasons:

1. First, recreational marijuana is expected to result in at least $100 million in annual tax revenue for New Jersey alone. Given the steep decline in tax receipts due to the COVID-19 pandemic, the potential for increased tax revenue is a powerful incentive for state legislatures facing budget cuts.
2. Second, as more states legalize recreational marijuana, it becomes virtually impossible for their neighbors to stem the flow of marijuana into their states.

Legalizations in 2021

Where states legalized recreational marijuana, their neighbors quickly followed suit to avoid the loss of tax dollars going across the border. New Jersey's larger neighbor, New York, legalized recreational marijuana this March, and New Mexico's neighbor, Arizona, followed suit in April. Virginia also legalized recreational marijuana in April. The expansion of the map will almost certainly lead to increased legalization efforts as more and more states now border others states where marijuana is legal.

Barriers for Legalizations

Keep in mind, though, that there are still barriers for the marijuana industry for these states and...