Both recreational and medical marijuana have been legalized in New Mexico. In 2021, the state joined a list of states that have legalized marijuana through the legislative process rather than by ballot initiative. Under the Cannabis Regulation Act, New Mexicans who are 21 and older are permitted to possess and buy up to 2 ounces of cannabis, 16 grams of cannabis concentrates, or up to 800 milligrams of infused edibles in one purchase. Marijuana use is currently banned in public places; its use is limited to only on private properties.
Residents aged 21 and older can grow up to 6 immature plants per person, or 12 plants per household without a permit. However, the plants must be grown in discretion, meaning children and neighbors cannot see the cannabis plants maturing. New Mexico does not allow marijuana grown at home to be sold or bartered.
The Cannabis Regulation Act also ensures that the scent of marijuana no longer serves as an adequate cause for searching vehicles and property. However, any person caught driving under the influence of cannabis will be charged with a Driving While Impaired (DWI) offense. Although personal recreational use of marijuana became legal in June 2021, licenses to sell cannabis are not expected to be issued earlier than 2022.
New Mexico forbids the advertisement of cannabis using cartoon characters or other appealing imagery to persons under the age of 21. Marijuana advertisements are also forbidden on billboards or other public media within 300 feet of a school, daycare center, or church. All marijuana products in New Mexico must carry a state-approved warning label.
The State of New Mexico places no limit on the number of marijuana business licenses that may be granted under the state's cannabis program or the number of facilities a licensee may open. However, regulators may stop issuing new licenses if an advisory committee determines that market equilibrium is deficient. Cannabis purchases will include a 12% excise tax on top of the state's regular 8% sales tax. Starting from 2025, the excise tax would rise by 1% each year until it reaches 18% in 2030. Per the Cannabis Regulation Act, medical marijuana products, available only to patients and designated caregivers, are exempt from tax.
Cannabis law in New Mexico permits the state to force licensed cannabis producers to reserve up to 10% of their products for patients in the event of a shortage or grow more plants to be used in medical products. This is a provision to ensure medical patients can still access medicine after the adult-use market opens.
Unlike in several other states, New Mexico does not permit local governments to ban cannabis businesses entirely. However, municipalities can use their local zoning authority to limit the number of retailers or their distance from schools, daycares, or other cannabis businesses. Tribal governments in New Mexico can participate in the state's cannabis industry pursuant to legal agreements contemplated under the Cannabis Regulation Act.
The cannabis industry in New Mexico is overseen by a newly formed Cannabis Control Division (CCD) under the state Regulation and Licensing Department. Medical marijuana is regulated by the CCD, while the state Department of Health retains control over the patient registry.
While recreational marijuana was only legalized in New Mexico in 2021, medical marijuana had been legalized in the state since 2007 following the passing of the Lynn and Erin Compassionate Use Act. Also called SB 0523, the Lynn and Erin Compassionate Use Act established a system regulated by the New Mexico Department of Health (NMDOH) and directed the NMDOH to establish, implement, and administer the statewide Medical Cannabis Program. The Act permits New Mexicans with a physician's recommendation for treatment of one of the 28 recognized medical conditions to use cannabis.
To use medical marijuana in New Mexico, you must obtain a medical marijuana card and be over the age of 18. Persons below the age of 18 may designate adult parents or legal guardians as caregivers to help purchase marijuana and administer care. Pursuant to SB 406, New Mexico allows for reciprocity in its medical cannabis program by accepting out-of-state medical card carriers to purchase medical cannabis in the state. You can purchase medical marijuana from state-licensed dispensaries provided you show proof of legal age, a medical marijuana card, and a recommendation from a New Mexico-licensed physician. SB 523 does not preclude felons from accessing medical marijuana in New Mexico.
According to a report submitted by a working group formed by the New Mexico Governor to study the impact of marijuana legalization, New Mexico medical marijuana sales totaled $130 million in 2019. Sales have been rising in recent years with the patient count in the southwest state increasing nearly fourfold since 2016. In 2020, the state's medical cannabis market posted sales totaling $203 million, an increase of $74 million on 2019 figures, according to estimates from Ultra Health, one of New Mexico's leading medical marijuana operators.
Estimates from the report from the New Mexico Marijuana Working Group also indicate that the recreational market to outgrow the state's medical marijuana market at least three times over at startup (one-year period). During that early period, sales are estimated to go beyond the $300 million mark with New Mexico accruing state and local taxes in the excess of $63 million.
In comparison, the New Mexico Legislative Finance Committee estimated sales revenue to be closer to $250 million in the first year. Per estimates obtained from the fiscal impact report of the Committee, approximately $47.5 million in tax revenue could be generated in the first full year of legal sales which includes excise tax and gross receipts tax for the state and local economies.
The report also estimates the market size for recreational marijuana to outgrow the medical marijuana market by the fifth year of legalization. Sales are expected to go beyond $620 million with state and local taxes bringing in more than $93 million. In addition, New Mexico Rep. Javier Martinez reported that the state would gain up to 11,000 jobs in the first year of legalizing recreational marijuana.
Tax revenue in 2022: Legal sales of recreational cannabis in New Mexico began in April 2022. After the first month of legal sales, the NM Taxation and Revenue Department announced that the state generated $2,422,678 in marijuana excise tax. In addition to that, the department received gross receipts tax amounting to more than $1.6 million. Recreational marijuana sales have reached the $120 million mark since legal sales began in April. The latest report published by the Cannabis Control Division showed a total adult-use marijuana sales of over $24 million in September 2022 alone. Sales in the previous months were also above $20 million. Since the cannabis excise tax is 12% of sales, it is expected that the total tax revenue within the first six months should be more than $12 million.
As stated under the Cannabis Regulation Act, 30% of revenues generated from adult-use sales will be distributed to cities, counties, and other municipalities. The remaining revenue will go into the state’s general fund, which may be used for housing, public health, education, court system, and hospitals. Apart from the tax revenues, the New Mexico cannabis industry is expected to provide more than 11,000 jobs for residents.
DWI arrest numbers were 18,460, 18,347, and 19,597 in 2005, 2006, and 2007 before the legalization of medical marijuana. The numbers have dropped in recent years with 10,468 and 10,376 DWI arrests recorded in 2018 and 2019. The latest DWI report published by the NM Department of Transportation shows that DWI arrests have reduced by 22.5% from 2018 to 2020, which recorded more than 8000 arrests.
According to the FBI Crime Data Explorer, marijuana-related arrests (possession and sales) were put at 2,537, 1,912, and 2,905 in 2005, 2006, and 2007 in New Mexico. In recent years, the figures recorded by the state for marijuana-related arrests in 2016, 2017, 2018, 2019 were 3,946, 3,565, 2,860, and 1,450 respectively. In 2021, law enforcers in New Mexico arrested 182 persons for marijuana possession violations, while 13 persons were arrested for violating marijuana sales regulations.
In 1923, New Mexico prohibited the sale, cultivation, and importation of cannabis. Although simple possession was not expressly prohibited, anyone found in possession was presumed to have imported marijuana illegally. In 1978, the state became the first state to pass legislation permitting the use of medical cannabis in some form. The statute, known as the Controlled Substances Therapeutic Research Act, allowed the use of cannabis through a research program authorized by the Food and Drug Administration, using cannabis obtained from the National Institute on Drug Abuse.
The Controlled Substances Therapeutic Research Act was initiated by the efforts of Lynn Pierson, a cancer patient who found relief from the symptoms of the condition by using cannabis. He pleaded his case to New Mexico lawmakers to allow continued use of the drug, and his efforts were rewarded in February 1978 when the bill was signed into law. Still, the medical cannabis program in New Mexico required federal approval, which did not arrive until August 1978, not long after the death of Pierson due to his illness. Following a reversal of the approval a few weeks after Pierson's death, the final approval came in November 1978, and cannabis was delivered to the state two months later.
In April 2007, Governor Bill Richardson signed into law SB 523, thereby legalizing the use of medical cannabis. SB 523 allowed for the use of cannabis with a physician's recommendation for treating the symptoms of medical conditions such as glaucoma, cancer, epilepsy, multiple sclerosis, and HIV/AIDS. In the following years, the list of qualifying conditions was expanded, and the cultivation of cannabis by patients was also permitted. SB523 was sponsored by Shannon Robinson and was passed in the New Mexico Senate by 32-3 margin, and the House of Representatives by a 36-31 margin during the 2007 legislative session.
In the first quarter of 2019, HB 356 was approved by the New Mexico House of Representatives by a 36-34 vote. HB 356 proposed the legalization of the recreational use of cannabis and the establishment of a system for the distribution of cannabis through licensed dispensaries run by the state. HB 356 was sponsored by Javier Martínez, Antonio "Moe" Maestas, Daymon Ely, Deborah A. Armstrong, and Angelica Rubio.
HB356, also called the Cannabis Regulation Act, was advanced by the House Judiciary Committee for a vote by the House of Representatives on February 22, 2019. It was the first time a legalization bill had been advanced to the state legislature for a vote. Following the passing of HB 356 in the House, the bill stalled in the Senate Finance Committee. However, Governor Michelle Lujan Grisham announced plans to add the issue to the legislative agenda for the upcoming year.
Governor Lujan Grisham signed SB 323 into law in April 2019, making first-time possession of up to 14 grams of cannabis a petty misdemeanor offense, punishable by a $50 fine. SB323 also decriminalized possession of drug paraphernalia, thereby making the State of New Mexico the first state to do so. SB323 was sponsored by Joseph Cervantes and was passed by the House of Representatives by a 44-20 vote and 30-8 in the Senate. The bill went into effect as law on July 1, 2019.
On April 12, 2021, HB 2 was signed into law by Governor Lujan Grisham. It was sponsored by Javier Martínez, Andrea Romero, Deborah A. Armstrong, Katy M. Duhigg, and Linda M. Lope, and passed the House of Representatives 38-32 and the Senate 22-15 at a special legislative session summoned by the Governor after the legislature failed to legalize cannabis during the regular 2021 session. HB 2 legalized cannabis pursuant to the following conditions:
Possession of cannabis for New Mexicans aged 21 and older on June 29, 2021. No possession limits were specified for possession of the drug at home, while a 2-ounce limit applies outside the home.
Personal cultivation of 6 immature plants is allowed per person, with a limit of 12 immature plants per residence.
Retail sales of cannabis are to begin no later than April 1, 2022, with an excise tax of 12% applied in addition to regular sales tax.
No limits on the number of retail licenses issued by the state. Local governments are allowed to restrict the number of dispensaries or their locations but cannot ban them entirely.
Public consumption remains illegal, but businesses are permitted to offer on-site consumption if specific requirements are met.
Cultivation of marijuana in the United States, the early 17th century.