New Mexico, Population 2.1 Million, Tops $300 Million in Recreational Cannabis Sales in Year One?

The governor is celebrating the one-year anniversary of New Mexico's adult-use marijuana market. She highlights the state's impressive sales figures of over $300 million since April last year and the numerous job opportunities the cannabis industry has generated.

On Monday, Governor Michelle Lujan Grisham (D) reported that sales of recreational marijuana have remained consistent over the past year, with the monthly record for purchases being set in March at $32.3 million. Aside from the $300.1 million in sales generated by the adult-use market, New Mexico also recorded approximately $187.4 million in medical cannabis sales over the past year, bringing the combined total to $488.3 million.

The governor stated in a press release that within a year, the cannabis industry had produced hundreds of millions of dollars in economic activity for communities statewide. Additionally, the number of businesses in the industry is growing, and thousands of New Mexicans are employed by it. The governor expressed enthusiasm for the future of the innovative and secure adult-use cannabis industry.

Since opening marijuana shops in the state, New Mexico has amassed over $27 million in tax revenue from adult-use cannabis sales, which has benefited both the localities and state general fund. Additionally, the governor highlighted that the sales resulted from over 10 million transactions made within the year.

Linda Trujillo, the Superintendent of the Regulation and Licensing Department, stated that the New Mexico cannabis industry has demonstrated remarkable potential. Starting from the governor's signing of the legislation to the establishment of the Cannabis Control Division and the implementation of the new industry. She expressed optimism for further expansion in the second year.

It was not disclosed whether Lujan Grisham engaged in any purchases within the market during its first year. However, she did not dismiss the possibility during a previous visit to a cannabis retailer on an opening day last year.

Road To Cannabis Legalization in New Mexico

New Mexico's new law legalizing cannabis went into effect on June 2021, allowing individuals 21 years or older to possess and cultivate limited amounts of cannabis for personal use. The law permits the possession of up to two ounces of marijuana and 16 grams of concentrates and the cultivation of up to six mature plants.

The Cannabis Control Division, which operates under the state Department of Regulation and Licensing, followed its timeline to the letter. The division established an advisory committee and started accepting specific cannabis business licenses on September 1, 2021. By January 1, 2022, the division began granting permits to eligible commercial cannabis firms and license training and education programs related to marijuana. After that, retail sales of marijuana commenced on April 1, 2022.

The program does not impose a specific cap on the number of business licenses that can be issued or the number of facilities a licensee can open. However, if the advisory committee concludes that "market equilibrium is deficient," regulators may discontinue granting new licenses.

For every cannabis purchase, customers are subject to an additional 12% excise tax in addition to the state's standard 8% sales tax. The excise tax rate is set to increase by one percent annually starting in 2025 until it reaches 18 percent in 2030. However, medical marijuana items, which are only accessible to patients and caregivers, are exempt from the tax.

Texas residents crossing the border into New Mexico to buy cannabis is becoming a big business for the state

The legislation also made provisions to guarantee that medical patients can continue to obtain their medication once the adult-use market commences. The legislation enables the state to mandate licensed cannabis producers to set aside up to 10 percent of their supplies for patients in the event of scarcity or grow additional plants to be used in medical products.

Legalizing cannabis was part of Lujan Grisham's legislative agenda for 2021, and she frequently highlighted the importance of legalization as a strategy for bolstering the economy, particularly in light of the COVID-19 pandemic. In a State of the State address in January, she stated, "a crisis like the one we faced last year can either be perceived as a setback or as an opportunity to reconsider the existing system - to be ambitious, imaginative, and daring."

During the special session, another complementary bill, which provides for expungements of convictions that have become legal under the marijuana legalization law, was also passed and signed by the governor. As per the bill, courts reopened eligible cases within 30 days after the law was enacted.

Increased Acceptance of Adult-use Cannabis

In recent months, officials from other states have also been promoting marijuana sales, such as in neighboring Arizona, where adult-use cannabis purchases in 2022 culminated in a year-end total of $1.4 billion. Massachusetts' recreational market achieved an official sales total of over $4 billion in January, following its launch in 2018.

On the other hand, a leading senator from Wisconsin released a legislative analysis that revealed the significant amount of money the state missed out on compared to Illinois last year. The investigation disclosed that Wisconsin residents, lacking a regulated market of their own, spent over $121 million on marijuana by crossing the border.

Lawmakers in New Mexico recently passed a bill establishing a state organization to examine the feasibility of initiating a psilocybin therapy program. This will be for individuals with specific mental health conditions who may experience benefits from using the psychedelic substance.

Conclusion

Michelle Lujan Grisham, the governor of New Mexico, has been enthusiastic about commemorating the market's one anniversary for adult-use marijuana. The cannabis sector has produced hundreds of millions of dollars in economic activity for towns statewide, with sales topping $300 million and creating numerous job possibilities.

Also, the market's success has brought the state approximately $27 million in tax income. Superintendent of the Regulation and Licensing Department Linda Trujillo expressed hope for the second year's sector growth. This achievement is a testament to New Mexico's innovative and secure adult-use cannabis industry. It is a promising sign of increasing acceptance of adult-use cannabis across the United States.

With the legalization of cannabis and the exploration of new therapies, such as psilocybin, New Mexico continues to show its commitment to ambitious, imaginative, and daring solutions that benefit its citizens.