The Murphy administration is keeping $60 million in the upcoming budget from recreational marijuana tax revenue, Treasurer Elizabeth Maher Muoio told the Senate Budget Committee Tuesday afternoon, despite the decreasing likelihood that a legalization bill would be approved in time for the June 30 budget deadline.
Under Gov. Phil Murphy’s $38.9 billion spending plan for fiscal year 2020 the state would see $60 million from the taxation of recreational marijuana, $21 million of which would go toward the one-time set-up of the bureaucracy to regulate the cannabis market.
“I don’t think that’s going to happen this year,” Senate Budget Chair Paul Sarlo, D-36th District, said Tuesday. “That’s not something we should consider as part of the final budget negotiations. I’m not sure if that will be part of what’s going to happen in this current fiscal year.”
Murphy included $80 million in last year’s budget from the taxation of recreational marijuana, only to take the revenue out of the budget days before the end of negotiations.
Insiders across Trenton have predicted the legalization bill is dead after Senate President Stephen Sweeney, D-3rd District, backed out of a closed-door meeting between Murphy and Assembly Speaker Craig Coughlin, D-19th District, on how to whip the 21 votes needed to pass the bill in the state Senate.
Many onlookers have postulated that Murphy’s scrutiny and criticisms of the state’s Economic Development Authority’s Grow New Jersey tax breaks, which Sweeney supports, have derailed the legalization talks.
Murphy unveiled a task force in January to scrutinize how Grow NJ was crafted and how corporations applied for and received tax breaks. The task force, in early May, honed in on how corporations, businesses and lobbying firms with strong ties to insurance executive and South Jersey powerbroker George Norcross crafted the Grow NJ program or unethically benefited from the tax breaks.
Norcross is a strong ally of Sweeney, and the Murphy administration’s spotlight on Norcross has been seen as an attack by the governor on Sweeney. In turn, the South Jersey Democrat unveiled his own legislative committee to evaluate Grow NJ.