Both chambers of the New Mexico Legislature passed a bill legalizing and regulating recreational cannabis use on May 31, and the Cannabis Regulation Act passed the state House by a 38-32 vote, the New Mexico Business Coalition reported.
The senate also voted to pass a provision that would expunge certain cannabis offenses from arrest and conviction records.
So now what?
The New Mexico Business Coalition recently reported that less than 1% of a state's tax revenue tends to come from legal marijuana taxes, which would put a damper on any expected economic boom as a result from the legalization of marijuana.
Kelly O’Donnell, a professor at the University of New Mexico School of Public Administration and an economist, stated that by her calculations the state should expect legalized cannabis to bring in about $342 million to roughly $1 billion by 2026.
Rep. Javier Martinez, (D-Albuquerque), said that New Mexico towns near the Texas border such as Sunland Park and Las Cruces were in great position to capture revenue from El Paso County.
“My hope is that all of those restaurateurs and people operating bars and entertainment venues and whatnot get ready, because this is going to bring more traffic into your community the way it has in Colorado,” he said, according to Border Report.
In contrast, the New Mexico Business Coalition (NMBC) has released a report that employers in the state could have a hard time maintaining a drug-free work environment and the recent legalization of cannabis would make it difficult for employees to pass a drug screening despite lawmakers touting that legalization could make the industry thrive in the state, bringing in more jobs and revenue.
The same NMBC report also notes that marijuana legalization has coincided with a growth in homelessness in other states. After legalizing recreational marijuana in the state of Washington, the homeless population increased by 18.9%. Similarly, homelessness increased by 9.1% after legalization in Colorado.
New Mexico voters largely favored legalizing and taxing marijuana sales to adults 21 and over at 72%, according to a poll conducted by Drug Policy Action.
The state is in the midst of a severe drought, which could play a critical role in how well the cannabis industry does in the state as it is estimated that approximately 30,000 gallons of water would be needed each year for the growth of the product.
A backlog of applications for water permits illustrates that the water utility in the state is already stretched thin and that the large amount of water needed to grow cannabis could compound the effects of the drought.
Gov. Michelle Lujan Grisham has gone on record that the industry would be a boon to the state’s economy.
In January, while giving her State of the State address, she said that “a crisis like the one we’ve experienced last year can be viewed as a loss or as an invitation to rethink the status quo—to be ambitious and creative and bold.”
