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New York Vs. New Jersey: The Battle for Pot Supremacy

As the Green Rush heads east with billions of dollars on the line, an old interstate rivalry heats up.

Photo by Jakub Matyáš

New York and New Jersey enjoy something of a rivalry. And when it came to legalizing Cannabis, the competitiveness of the neighboring states was crystal clear. New Jersey was first to approve recreational marijuana – its voters did so in November, while lawmakers and Gov. Phil Murphy made it official in February. Shortly thereafter, New York followed suit. The Empire State had no interest in lagging behind the Garden State. But who will be first to market? And who will collect the most tax revenue? 

Both states are expected to pass $1 billion in legal pot sales. But Crain’s New York sees something in the state laws that might provide an advantage.

While New Jersey’s new regulatory framework law caps the number of cultivation licenses that can be issued at 37 over the next two years, New York’s law includes no such cap. This difference could give New York a leg up in keeping up with retail demand. 

Industry analysts predict that having no cap on the number of cultivators will eliminate supply shortages in New York.

After all, we’ve seen newly legal states struggle to keep up with demand at the start of retail sales. Most recently, Maine was caught off guard during the state’s opening weekend of sales, where lines grew long and dispensaries were forced to limit purchases. And prices were high, particularly compared with nearby Massachusetts, which has had years to work out the retail weed kinks.

So, no cultivation cap means New York wins, right? Well, not so fast. While the cap was one of several issues Gov. Murphy and lawmakers fought over, it doesn’t necessarily render New Jersey incapable of stocking the shelves. That’s because the state allows an unlimited number of microbusinesses, which must have no more than 10 employees and occupy no more than 2,500 square feet.

These businesses are more than capable of pumping out enough pot to keep recreational Cannabis customers satisfied. 

And, while New York lawmakers specifically opted to go without a cap for both supply reasons and to prevent a few giant corporations from coming in and cornering the industry, there could still be a cap. The rules governing New York’s Cannabis law can be changed, and if a license cap makes sense, it could be included in the rules.

So, who has the advantage in this multibillion-dollar business? We’ll have to check back in at the start of legal sales.

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