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Do we want a bud shop in our town?

Legal weed. First in a two part series: This week, a look at New Jersey towns; next week, a look at New York towns. Local views collide over recreational marijuana – or “state-sponsored drug pushing.”

| 20 Aug 2021 | 10:36

Now that recreational marijuana is the law of the land in five states from New Jersey to Maine, towns and villages across the region find themselves at a fork in the road. Should they cash in on the tidal wave of demand? Run in the other direction? Or tap the brakes, and wait and see how it goes in other towns?

From the Jersey shore to the Adirondacks, cities and towns have been trying to come to some consensus about what kind of community it wants to be. Each zip code is doing its own homework and its own soul searching, weighing on the one hand the allure of tax revenue, job creation, and tourism that “cannabusinesses” would bring; and on the other, concerns over image, security, traffic, and for some, morality.

The debate is going full tilt across New Jersey, where the deadline for towns to opt out is Aug. 21. Towns that don’t take action by the deadline will be locked into the legal weed system, though whether a community would be forced to accept a dispensary remains unclear.

Whatever they decide, communities can’t override state laws: they can’t stop adults from smoking pot, or prevent licensed cannabis delivery companies from servicing their area. People will be toking up, that’s a given. The question is where they will get their weed, and hence, who will profit.

Not in my town

Garden State residents said yes, loud and clear, to legalizing recreational marijuana in a November referendum that passed 2-1, a margin so decisive it spurred much of the eastern seaboard to follow suit. As it turns out, though, not all of those people are eager to have a bud shop down the block. In Sussex County, N.J., Byram, Franklin, Stanhope, Ogdensburg, and Sparta have joined the nearly half of municipalities statewide that have said no thanks, for now, to all classes of legal weed enterprises under their purview, like dispensaries, warehouses, or grow facilities.

Tax revenue from those kinds of businesses would be akin to “blood money,” in the eyes of Byram Deputy Mayor Raymond Bonker. “I will not sell out my hometown for 30 pieces of silver,” he said, a Biblical reference to the money Judas received for betraying Jesus. Bonker’s kids were the eighth-generation of his family to grow up within a 10-mile radius in Byram, a township of 8,350 with a medium household income of $103,519.

The Byram Township Council voted to reject all the cannabis-related activity in its purview, over the lone objections of Mayor Alex Rubenstein, who favors “tasteful” pot shops. Rubenstein asked rhetorically whether, if they were going to get into the business of banning unhealthy things, they should go after McDonald’s sodas next.

Pot shops on the main drag would deal a blow to the town’s carefully fostered, “family-friendly Main Street atmosphere,” said Bonker, 58, a retired Wall Street computer scientist. It would impart the wrong message to kids looking out the school bus window, he believes. Generally, he supports a libertarian approach but draws the line on drugs and prostitution – a line that others may draw differently, he acknowledges, and one that gets drawn and redrawn over time in our democracy. Some might call him “moralistic,” he said, a description he doesn’t shy away from. His reasons were only his own, he clarified. The rest of the council’s reasons for voting “no” varied.

Byram residents voted strongly in favor of legalization in November, a tick more enthusiastically even than the state as a whole. But what 69 percent of residents said “yes” to was amending the Constitution to legalize cannabis, Bonker points out. That’s very different from getting into the business of selling it themselves. Conflating the two issues “is a classic moving of the goalposts,” he said.

“Inducing towns like Byram to permit pot shops in exchange for extra tax revenues on sales is a Faustian bargain,” said Bonker. “It puts the town and its taxpayers into a position where they have an incentive to increase marijuana usage to generate more money. That is state-sponsored drug pushing, and it makes all of us complicit in an activity that many people find ill-advised if not outright wrong.”

Besides, he doesn’t expect mom-and-pop cannabis operations to make it long-term. Big Weed is chomping at the bit to take over the nascent market, and eventually, Bonker said, a small number of Amazon-style home deliverers or major retailers will put the little guys out of business. In the meantime, he worries that the presence of a doomed dispensary, taking up limited space in the town’s one retail corridor, might deter more desirable long-term businesses – say, a developer looking to build senior housing along Route 206 – from making the investment.

The Byram council will revisit the issue at some point, “but not any time soon,” said Bonker. “First we need to see what the state will actually produce in terms of rules and regulations. We will also see what the experiences are in other towns.”

Business, not morality

Bucking the statewide trend, West Milford, Vernon and Newton have decided to roll out the welcome mat to the billion-dollar legal weed industry. These three towns have given the nod to all the classes of legal weed enterprise including retail, the most lucrative but also the one likeliest to make a municipality balk. Marijuana Business Daily projects New Jersey’s adult-use market will generate $850 million to $950 million in annual retail sales by 2024. In New Jersey, two percent of most cannabis income goes to the town where the business is licensed.

West Milford wasted not a moment to signal their enthusiasm. Towns don’t technically have to do anything to opt in; doing nothing is a tacit acceptance of the nascent industry. But in an attempt to differentiate themselves from the merely neutral, gung-ho towns have been passing formal resolutions, essentially flying their seven-leaf flag to lure entrepreneurs their way.

The month after recreational marijuana was legalized, West Milford Township – average household income of $100,461 – announced itself willing and eager to host retailers, growers, distributors and processors. The resolution passed just before Township Councilman Michael Chazukow, a pro-cannabis Republican, was sworn in. A West Milford native and longtime cannabis activist, Chazukow has said for years that legalization fits with the community’s conservative values of personal freedom.

In Newton, whose median household income is $48,702 and 13 percent of the population lives below the poverty line, cannabis retail sales will be limited to storefronts on two streets in town, and not on Sundays. Retailers can’t permit loitering outside the entrance. The police chief is not happy about it. He worries it will make cops’ job harder, and is concerned about the piece of the new law that prevents cops from notifying parents when they bust a kid for pot or alcohol for the first time.

Vernon, where more than 70 percent of residents supported legalization in November, originally green-lighted all cannabis enterprise except retail. Then – after a good look at the financials, and a councilmember’s visit to a medical dispensary in Maplewood – the township council changed its mind. They voted 3-2 to introduce an ordinance allowing up to three dispensaries after all, taking the advice of Jennifer Lubliner, who chairs Vernon’s Economic Development Committee.

“This is a business decision and not a morality issue,” Lubliner said, urging the township not to restrict cannabis business at all.

Harry Shortway, chair of the township council as well as a lacrosse coach, said he saw no friction between Vernon’s image as a healthy, outdoorsy community with marijuana shops in town. “My only really concern is the whole driving issue,” said Shortway, a retired cop. “But I understand a new breathalyzer is coming out shortly that would be able to get the deep air. That’s my major concern, is driving while under the influence of, whether it be alcohol or any kind of controlled, dangerous substance.”

How to detect stoned drivers may be the top concern for towns considering legal marijuana. “On the one hand, cannabis doesn’t impair driving nearly as much as alcohol does,” said Dr. David Nathan, a psychiatrist and leading voice in the medical community on marijuana reform. “That’s a good thing, and if people drink less and are using more cannabis you might actually see fatal accidents and DUI incidents go down. But if people are drinking and using cannabis at the same time, that makes the risk go up to be higher than alcohol alone. So we want to get the word out that you should never drive impaired. You certainly should never drive after drinking and smoking. It’s worse than just drinking. That to me is the biggest risk. I think everything else is manageable.”

The Vernon council has proposed earmarking 15 percent of the tax revenue to law enforcement for additional training, including training a drug recognition expert. Another 10 percent would go to zoning, to administer and enforce the new ordinances.

“My opinion is the general taxpayer should not pay for enforcement of these ordinances,” said Shortway. “That should really come from the business owners and those that use the product.”

Crunching numbers from other states, Lubliner ballparks that a town like theirs – population 23,943, medium household income $81,129 – could bring in between $20,000 and $50,000 a month in tax revenue.

In Massachusetts, where legal recreational marijuana sales began in 2018, towns like Vernon have seen an economic boom, she said. Not only are they getting the tax dollars from marijuana sales, but there’s also been a ripple effect. “As a result of having more tourists, even if it’s just people buying retail marijuana, they’re seeing more people walking around town, more people using the restaurants, and that’s created more demand for other businesses to grow,” she said.

“Although New Jersey, being New Jersey, is more restrictive than other states,” she added wearily, starting with a very limited number of licenses available statewide.

The way things are going, Lubliner would be surprised if rural Sussex County ended up with more than two cannabis-related businesses altogether. With most of the county’s towns opting out or vacillating, she thinks cannabis entrepreneurs vying will try their luck in more populated areas. “The people who are getting the licenses and going through that process right now, are looking for towns that are ready for them,” she said.

It’s a once-in-a-lifetime opportunity, Lubliner believes, the likes of which we haven’t seen since the end of the other Prohibition in the 1930s. “I think we should be on the right side of history and not restricting these types of businesses,” she said. “I feel like we should let the market decide. If a business owner thinks that they can make money and be successful by opening one of these stores in Vernon, we shouldn’t tell them that they’re not allowed to do that.”

Better safe than sorry

That half of New Jersey towns have opted out is no surprise to Dr. David Nathan, the founder of Doctors for Cannabis Regulation. “Not because they don’t want dispensaries, but rather because of the way the law was written,” he said. “If towns are at all unsure, the smart move is to preserve their options by opting out.” If towns do nothing, they are locked into that decision for five years, while if they opt out now, they can opt back in at any time.

All the opting out is temporary. The industry is on its way, said Nathan. “Cannabis dispensaries will open and the profit motive will insure that this does go forward,” he said. “The main thing is, we want to get it right from the outset. This is an industry we’re building from the ground up.”

“It’s highly likely the town banning it now will end up opting in over the next couple of years,” agrees Evan Nison, 31, the youngest member of the board of directors of NORML, a pro-legalization advocacy nonprofit. Twin motivating factors are at play. First, there are the tax revenue and job creation at stake – including ancillary industries like marketing agencies, law firms, accountants. Second, there’s politics. “It was also passed by a two-to-one margin by voters,” he said. “I think a lot of the local politics is going to start playing out and the towns that banned will start getting pushback. I mean, two to one is a pretty significant margin. That’s a mandate from the voters, and to deny that is pretty politically unintelligent. That may come back to bite them.”

The hesitant start follows a similar arc to what happened in Colorado, California, and Massachusetts, said Nison.

“Not surprisingly, when this issue is introduced, a lot of people will ban it to quote unquote ‘be safe’ in the local government,” he said.

It doesn’t usually take long, he said, for towns to decide to reverse course.

“Then they quickly realize they’re not stopping cannabis flow from their municipal borders,” said Nison. “It’s still legal, and they’re not getting any benefits.”

“Inducing towns like Byram to permit pot shops in exchange for extra tax revenues on sales is a Faustian bargain. It puts the town and its taxpayers into a position where they have an incentive to increase marijuana usage to generate more money.” Councilman Raymond Bonker, Byram, N.J.