new mexico cannabis legalization covid 19

The governor of New Mexico expressed regret that her administration were unable to legalize cannabis this year as it would have led to a much-needed tax windfall amid an economic downturn prompted by the COVID-19 pandemic.

Gov. Michelle Lynn Lujan Grisham (D) made the remarks during a recent livestreamed press conference when asked by Dan Boyd from the Albuquerque Journal what steps she will take to aid the state’s economic recovery.

New Mexico’s state budget is heavily reliant on oil and gas industry revenues which have plummeted – losses are estimated at about $500 million – due to lower demand wrought by the coronavirus outbreak. Gov. Grisham acknowledged the need to coordinate state and federal responses with oil and gas companies before lamenting the missed economic opportunity of marijuana legalization.

“You know, if there was ever a time for wishful thinking, I wish we had passed recreational cannabis because that would be $100 million [in tax revenue],” she said. “Now that was before COVID-19, but that would be $100 million in the budget. And I am very sad about that.”

The $100 million figure is an estimate provided by a working group the governor convened last year to report on the impact of cannabis legalization. This estimate includes total projected revenues from a legal adult-use market upon maturity and New Mexico’s established medical cannabis dispensaries. The governor’s working group advanced a marijuana legalization proposal, but this would have only allowed for legal sales to begin on July 1, 2020. This means the much-needed tax revenues from cannabis sales would probably not have been collected during the worst of the crisis.

That said, Emily Kaltenbach, executive director of the New Mexico Drug Policy Alliance, thinks cannabis legalization should be an integral part of the state’s strategy to move away from its dependency on oil and gas revenues.

“[I]f we could legalize cannabis in New Mexico, it’s not going to solve our budget woes, but it would add to the state coffers,” Kaltenbach said. “We need to be creative and we need to diversify our economy so that we are not reliant on oil and gas, and legalization is one of the ways to do that. So, it’s encouraging to hear perhaps we may be more inclined to legalize given the economic situation we are in right now.”

The marijuana legalization bill proposed by Gov. Grisham’s working group passed one Senate committee but was voted down by another three weeks later in February. This led Grisham to announce she would be “open to any number of pathways” to pass legislation to legalize adult-use cannabis, such as a voter-approved ballot initiative.

Another possible avenue for cannabis legalization in New Mexico in the short-term could be a special legislative session which is expected to convene in mid to late June. However, a spokesperson for the governor said it’s unlikely the issue will feature. House Speaker Brian Egolf (D) echoed these sentiments saying legislation in this session would be targeted on coronavirus relief measures.

While the total revenue an adult-use cannabis market in New Mexico would have brought in during the coronavirus pandemic is up for debate, in those states which have legalized marijuana it’s been widely deemed an essential service. At the same time, the COVID-19 pandemic has stalled progress towards marijuana reform across the country due to social distancing guidelines, the suspension of legislative sessions and lawmakers’ prioritizing action on coronavirus-related measures. The question then, in response to House Speaker Egolf’s statement, is why shouldn’t marijuana legalization be considered a part of New Mexico’s coronavirus relief measures?

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