More than $6 million collected from New Jersey’s social equity cannabis tax remains untouched, despite repeated recommendations from the state’s cannabis regulatory body urging lawmakers to allocate the funds. The money, meant to support communities impacted by the war on drugs, has been piling up since recreational sales began in 2022. Yet, the state Legislature has not acted on proposals to put the money to use.
Millions Collected, None Spent
The funds in question come from the social equity excise fee, a tax paid by cannabis cultivators. The goal is to channel revenue into economic development, legal aid, and support for entrepreneurs in areas disproportionately affected by marijuana prohibition. But instead of being directed toward these efforts, the money has been sitting in a state-controlled fund, waiting for legislative approval.
As of August 2024, the balance in the fund exceeded $6 million, according to Cannabis Regulatory Commission Chair Dianna Houenou. The commission has consistently advocated for the Legislature to allocate the money, submitting detailed recommendations over the past three years.
One major roadblock: the commission itself doesn’t have the power to spend the money. Under state law, only the Legislature can allocate these funds when crafting the state budget.
Push to Increase the Tax Goes Unanswered
Advocates have been pushing for a steeper tax to generate more revenue for social equity initiatives. The commission recently raised the fee to $2.50 per ounce for 2025—more than double last year’s amount—but some activists wanted a dramatic increase, arguing the tax should be set at the maximum allowable $30 per ounce.
Despite public pressure, legislative leaders have remained silent. Senate President Nicholas Scutari and Assembly Speaker Craig Coughlin declined to comment on the delay. A spokesperson for Governor Phil Murphy did not respond to requests for a statement either.
Public Frustration Grows
During a Tuesday meeting of the Cannabis Regulatory Commission, members of the public voiced their frustration over the inaction. Many believed the commission itself was responsible for allocating the funds, a misunderstanding that Houenou addressed head-on.
“If you read the report that we publish every year, we only recommend to both the state Legislature and to the governor how these funds should be used,” she said. “Again, we do not have the power to dispense these funds—we can only recommend.”
Some community leaders worry the unspent money reflects a broader lack of urgency in addressing the racial and economic disparities created by marijuana prohibition. Without action, they argue, the promise of social equity in New Jersey’s cannabis market remains unfulfilled.
Upcoming Hearings on Fund Allocation
The commission is not giving up. To keep the conversation alive, it will hold virtual hearings this month where the public can weigh in on how the funds should be used.
- Feb. 20 at 6 p.m.
- Feb. 25 at 11 a.m.
- Feb. 26 at 1 p.m.
These hearings may offer insight into where communities want the money to go. But until lawmakers take action, the millions of dollars meant to support social equity efforts will remain locked away, unused and out of reach.
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