The beginning of our story...
Before Phil Murphy was sworn in as governor of New Jersey on January 16, 2018, he spent a solid ten months endorsing recreational use marijuana and received substantial voter interest.
During the same period, our proprietary Subjective Probability + Game Theory Model forecasted a different conclusion. Our analysis consisted of 6 primary categories and 7 sub-denominations, which focused on the legislators, their proponents and constituents. Our analytics kept flashing negative feedback on the question: "Does the state legislators have enough votes to pass a comprehensive recreational marijuana use bill?"
SP+GTM algorithm continued to show +37 to +42 with a negative coefficient of 10. (+35 means the value of a positive answer to a specific question was 35%. The coefficient of 10 means, no level of change due in the near term.) At no time since Murphy declared his position has SP+GTM gone positive.
Meanwhile, the enthusiasm and level of public acceptance was above 50%. The conflicting variables were enough to suggest that just maybe the SP+GTM algorithm was wrong. Even though the predictability of the model proved to be corrected, on a weighted average, 87.9% of the time on any specific question asked.
The management of First Jersey Cannabis Corporation went with Murphy's prediction and decided that the SP+GTM algorithm was wrong.
We invested in a Business Model with the primary factor --- the approval of recreational marijuana use in New Jersey by March 2019. From opting to acquire greenhouse, testing facilities, administrative offices, trade and domain names, website, marijuana data gathering and processing, developed and funded marketing and media departments, and filed a costly registration statement with the SEC for a stock offering to raise over $2 million, we were all in.
By January 2019, the writing was on the wall "Murphy unable to reliever." Correctional marijuana use in New Jersey was DEAD!
Thus, our Business Model was inconsistent with the new reality and the company withdrew its registration statement to sell equity, material contracted operations, sold off assets and waited.
Charter 2 - SP+GTM algorithm was right.
Now for the rest of the story ...
courtesy of Mike Davis, Asbury Park Press 11.19.19
TRENTON - After nearly two years of back-and-forth over legalizing marijuana, New Jersey legislative leaders announced Monday that legal weed is heading to the polls, setting up a pivotal ballot question in the 2020 election.
If voters approve the measure, New Jersey would become the 12th state to legalize marijuana for adult use. All but two of the states — Vermont and Illinois — have legalized weed via ballot measures. Senate President Stephen Sweeney, D-Gloucester, introduced a constitutional amendment that he expects to appear on the ballot in the 2020 election. Sweeney and Sen. Nicholas Scutari, who sponsored a stalled New Jersey legal weed bill, said they simply couldn't find enough support in the Senate to get a marijuana legalization bill passed. (emphasis added)
"This initiative will bring cannabis out of the underground so that it can be controlled to ensure a safe product, strictly regulated to limit use to adults and have sales subjected to the sales tax," Sweeney and Scutari said in a statement. If voters legalize weed in New Jersey in November 2020, it would take effect on Jan. 1. The law would only regulate marijuana bought, sold and used for recreational purposes; it would not impact the New Jersey medical marijuana program, which underwent its own series of changes earlier this year.
But it would likely be at least months before recreational marijuana dispensaries opened, as the Cannabis Regulatory Commission would first have to set the rules and guidelines for the new cannabis industry, as well as accept applications and issue necessary weed licenses. In other states with legal weed, recreational marijuana dispensaries have usually opened between 12 and 18 months after a ballot question was approved.
The biggest change in the ballot measure concerns the tax structure — or lack thereof. While legislators have called for levying legal weed taxes anywhere from 12% to 25% or placing a flat $42 per ounce rate, the ballot resolution specifically states that legal weed sales would only be subject to the New Jersey state sales tax. That 6.625% tax rate would be the lowest marijuana tax in the United States, which Scutari said would help push customers away from the black market and into legal marijuana dispensaries. "One of the things we can try to do to combat and eviscerate the black market is to have the lowest possible tax rate," Scutari said in an interview. "It'll take a long time to get rid of the black market, but this will help get it done."
Gov. Phil Murphy made New Jersey marijuana legalization a campaign priority when he was elected in 2017. But getting a legal weed bill through the Legislature has proved more difficult than imagined, as a number of prominent Democrats — notably members of the party's black caucus — quickly came out against it. “I am disappointed that we are not able to get this done legislatively and that our failed status quo – which sends roughly 600 people to jail a week for possession, the majority of them people of color — will continue," Murphy said in a statement. "However, I have faith that the people of New Jersey will put us on the right side of history when they vote next November. "By approving this ballot measure before the end of this legislative session, New Jersey will move one step closer to righting a historical wrong and achieving what I have spent more than three years advocating for."
Murphy, along with social justice advocates, has argued that legalizing marijuana would put a dent in the the racial disparity among those arrested on pot charges. Despite research showing similar marijuana use rates for whites and blacks, the latter are arrested for weed at three times the rate of whites in New Jersey.
Last week, an ACLU analysis of marijuana arrest data reported that one person is arrested every 14 minutes. A New Jersey report last year revealed that New Jersey police officers are the country's toughest enforcers of marijuana laws, with marijuana making up 10% of all arrests statewide.
Social justice advocates, such as Murphy, have long argued that passing marijuana legalization through the ballot should only be a last resort. The marijuana ballot measure is essentially a bare-bones version of the bills that had been the subject of hours of debate and analysis by legislators, advocates and voters. A ballot measure, for example, likely would not address weed expungements or include provisions mandating inclusion of minority cannabis business owners. Instead, those details, if pursued by lawmakers, would have to be ironed out by the Cannabis Regulatory Commission — or set forth in future legislation.
The ACLU of New Jersey last week said legislation was the "only path to end the destructive legacy of prohibition."
Marijuana legalization was just a few votes short from becoming a reality in March. Soon after, Sweeney said legal weed would instead become a ballot issue in 2020 — as announced Monday — but walked it back over the ensuing months, saying that the Senate would "try" to get it done in the post-Election Day lame duck legislative session.
Legislative leaders had hoped to tweak the bill to find bipartisan support, but Republicans didn't flip on what has been a traditionally liberal or moderate issue.
Last week, Sen. Declan O'Scanlon, R-Monmouth, seen as a key swing vote, announced that he wouldn't support any legal weed machinations unless voters approved it first.
In a press conference pressuring legislators to support a bill to legalize weed, longtime bill sponsor Scutari said, "we're closer than we've ever been before" in trying to get the bill passed legislatively. Hours later, Scutari, D-Union, signed onto a joint statement that said he and Sweeney "made further attempts to generate additional support in the Senate to get this done legislatively, but we recognize that the votes just aren’t there.
"We respect the positions taken by legislators on what is an issue of conscience." Scutari said the press conference was to pressure legislators to "take some action, and we took action very quickly, in a couple of hours."
Mike Davis has spent the last decade covering New Jersey local news, marijuana legalization, transportation and basically whatever else is happening. Contact him at 732-643-4223,
mdavis@gannettnj.com or @byMikeDavis on Twitter.