Lawmakers have three weeks to submit a bill to New Mexico Gov. Michelle Lujan Grisham to legalize recreational marijuana.
While the effort has widespread support, many issues remain contested regarding a taxed and regulated market.
The hope is to solve several problems by creating a competitive market, including creating jobs while nipping the illicit market in the bud.
A state Senate panel hopes to create a bill with broad support this week.
On Friday, the state House approved a bill that subsidizes medical cannabis for the poor and taxes retail sales about 20%.
The House pushed back on efforts to restrict production licenses.
Similar rules have actually made medical cannabis more expensive in Arizona, Colorado and Mexico.
Still, many lawmakers are divided on everything from tax rates and cultivation limits, to protections for niche markets and illicit drug decriminalization.