NM Legislature Should Avoid Traditional Licensing Of Recreational Cannabis Based On Population; “Let Supply And Demand” Market Forces Decide

On January 21, 2020, the 30 day New Mexico legislative session begins. The 30-day session is referred to as the “short session” which are held in even number years while 60-day sessions occur in odd number years. State lawmakers have already pre-filed nearly 90 bills ahead of the upcoming legislative session, but what actually gets put on the agenda is totally up to Governor Michelle Lujan Grisham. The governor has made it known that she wants marijuana legalized at this year’s session, which begins January 21.

On January 1, 2020, the State of Illinois became the latest state to legalize recreational cannabis. The recreational use of cannabis is now legalized in 11 states: Alaska, California, Colorado, Illinois, Maine, Massachusetts, Michigan, Nevada, Oregon, Vermont, and Washington, the District of Columbia. During the 2020 legislative session that begins on January 21, 2020, the New Mexico Legislature will likely attempt to make New Mexico the latest state to legalize recreational marijuana.

On January 1, 2020, New Mexico State Representative Javier Martinez, (D)-Albuquerque, made it known he is pre-filing a new bill to legalize cannabis. Representative Martinez served on the task force created by Gov. Michele Lujan Grisham the worked-on recommendation to legalize marijuana here in New Mexico. The group was made up of law enforcement, medical professionals and politicians and met several times throughout the state to discuss ideas and come up with recommendations to the governor.

According to Representative Martinez:

“I can’t wait for New Mexico to be next in line and be a leader in the country. … The country is following that lead, and New Mexico certainly wants to be among the first to legalization. … Not only to legalize but do it in the right way. One of the things I learned from the process is the openness and willingness of people across the state to look at recreational cannabis with an open mind. … There is going to be a very tight regulatory framework around the industry to ensure not only public safety, but quality for customers”.

Taking recommendations from the Governor’s Task force group into consideration, Martinez is pre-filing a new bill in the coming days to legalize cannabis. He said under the new legislation, recreational cannabis would be a private industry, regulated similar to the way the state does liquor stores. Martinez said his legislation will divert funding from cannabis sales to law enforcement programs statewide to help fight the war on drugs.

Martinez added that in order to protect the existing medical cannabis program, the gross receipts sales tax would be eliminated on any medical cannabis product to cut costs. He also suggested subsidies would be created for low-income patients.

A bill was passed in the House last year, but it never made through the Representative Martinez expressed high hopes that during the 2020 legislative session his colleagues in the House and Senate will be more accepting of the idea.



On March 7, 2019 the state House passed House Bill 356 (HB 356) with a two-vote majority of 36 to 34 that would have legalized the recreational use of marijuana. HB 356 bill included a provision for state run and regulated stores. House Bill 356 was a broad marijuana legalization proposal and dedicated some of the tax revenue from cannabis sales to research into cannabis impairment, purchasing roadside testing equipment for law enforcement and to train police officers as drug recognition experts when drivers are stopped. Every Republican Representative in the House voted against HB 356 joining 10 Democrats in opposition to it. The bipartisan proposal to allow cannabis sales at state-run shops narrowly cleared the state House but failed to make it through the Senate. After the Legislature adjourned on March 21, 2019, Governor Michelle Lujan Grisham announced she would add the issue of legalizing recreational marijuana use to the 2020 legislative agenda.


On June 28, 2019, Governor Michelle Lujan Grisham announced the creation of a “Cannabis Legalization Working Group.” The task force consisted of 19 members including the Democratic and Republican legislators who sponsored the unsuccessful legislation and included representatives of a labor unions, sheriff’s department, health care business, Native American tribes, medical cannabis businesses, a county government association, and commercial bank and hospital company.
On August 15, 2019, the Governor’s Cannabis Legalization Working Group was told by a consultant that if recreational marijuana is legalized in New Mexico, the state can expect out-of-state tourism and the reduced stigma and other factors to help fuel sales of recreational marijuana. It was reported that the demand for recreational marijuana and related cannabis products has far outpaced expectations in the State of Colorado since it was made legal. It was estimated the annual revenue for state and local governments could hit $120 million in five years, well beyond what legislative analysts estimated earlier this year. The market will also depend on the tax structure and the of regulatory decisions that will have to be implemented.


On September 10, 2019, the Governor’s task force endorsed and recommended a traditional licensing system for private companies that would grow and sell marijuana. The state would not operate retail stores. The licensing system is the same system as used for the State’s medical cannabis program. The proposal is a complete shift from the legislation that advanced through the state House last session where Democratic lawmakers embraced the idea of state-run cannabis stores as a part of a compromise with Republicans.


According to Governor Lujan Grisham, a recent poll showed 76% of New Mexicans are in favor of recreational marijuana. However, the poll does not mean lawmakers will be able to agree on a plan that best benefits New Mexico. In interviews, the Governor has acknowledged that winning approval of the marijuana legalization plan will be difficult. She believes the Senate will be the biggest hurdle and she had this to say:

“I think cannabis [recreational legalization] is going to be really hard [and] it should be. That is not something to run into without being really clear. … If I have it on the call, I’m serious about getting it passed”




New Mexico has some of the highest DWI rates in the country and ranks #1 in heroin overdose deaths with the state having a serious opioid crisis. Legalizing recreational marijuana has the danger of contributing to the State’s high alcohol and drug addiction rates, a legacy no Governor wants to be remembered for after they leave office. Notwithstanding, a recent poll shows 76% of New Mexicans are in favor of legalizing recreational marijuana. Further, any recreational cannabis needs to ensure that the states highly successful medical marijuana program is not placed in jeopardy.

When it comes to the legalization of the recreational use of cannabis, Representative Javier Martinez and the legislature would be wise to avoid a traditional licensing system like it created for full-service alcohol licenses. With present alcohol full-service licenses, the number of licenses is capped and based on population numbers. Liquor licenses are now being sold for upwards of $1.5 million. The result is that only the wealthy or major restaurant chains and corporations can only afford the licenses.

The result and unintended consequence will be identical with recreational cannabis licenses purchased for a few thousand dollars from the state and held onto as an investment and for a windfall profit. The exact same thing will happen with recreational marijuana licenses unless the licenses are not tied to population.

There should be no limit on the number of recreational pot licenses that will create a market of licenses that increase value and are considered an investment by the private sector as opposed to regulation by the state to protect the public health safety and welfare. Let free market of supply and demand dictate the number of licenses needed. Those with good business models will prevail.


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Pete Dinelli was born and raised in Albuquerque, New Mexico. He is of Italian and Hispanic descent. He is a 1970 graduate of Del Norte High School, a 1974 graduate of Eastern New Mexico University with a Bachelor's Degree in Business Administration and a 1977 graduate of St. Mary's School of Law, San Antonio, Texas. Pete has a 40 year history of community involvement and service as an elected and appointed official and as a practicing attorney in Albuquerque. Pete and his wife Betty Case Dinelli have been married since 1984 and they have two adult sons, Mark, who is an attorney and George, who is an Emergency Medical Technician (EMT). Pete has been a licensed New Mexico attorney since 1978. Pete has over 27 years of municipal and state government service. Pete’s service to Albuquerque has been extensive. He has been an elected Albuquerque City Councilor, serving as Vice President. He has served as a Worker’s Compensation Judge with Statewide jurisdiction. Pete has been a prosecutor for 15 years and has served as a Bernalillo County Chief Deputy District Attorney, as an Assistant Attorney General and Assistant District Attorney and as a Deputy City Attorney. For eight years, Pete was employed with the City of Albuquerque both as a Deputy City Attorney and Chief Public Safety Officer overseeing the city departments of police, fire, 911 emergency call center and the emergency operations center. While with the City of Albuquerque Legal Department, Pete served as Director of the Safe City Strike Force and Interim Director of the 911 Emergency Operations Center. Pete’s community involvement includes being a past President of the Albuquerque Kiwanis Club, past President of the Our Lady of Fatima School Board, and Board of Directors of the Albuquerque Museum Foundation.