On August 19, 2021, the New Jersey Cannabis Regulatory Commission (NJCRC) published its first set of rules and regulations, titled the “Personal Use Cannabis Rules,” governing recreational cannabis use for adults age 21 and older under the Cannabis Regulatory, Enforcement Assistance, and Marketplace Modernization Act (CREAMMA).
Below is an overview of some of the new rules for New Jersey’s adult-use cannabis program:
- Adults 21 and older can legally purchase and possess up to one ounce of marijuana. Home cultivation will not be permitted.
- Regulators will prioritize three licensing categories, which are designed to promote social equity by helping small businesses that are minority- and women-owned or located in an economically distressed area.
- The state has six main licensing categories: cultivators, manufactures, wholesalers, retailers, distributors, and delivery services.
- While hundreds of municipalities can elect to ban marijuana businesses, they cannot prohibit delivery services.
- Licensing decisions will be based on market demand, and regulators will also be prioritizing microbusiness and conditional licenses, in addition to social equity applicants.
- There will not be a licensing cap, except for cultivators. The cultivator cap is 37, though that expires on February 22, 2023.
Prior cannabis convictions will not disqualify people from obtaining a cannabis business license.
- Existing medical marijuana dispensaries will be able to apply for municipal approval to sell recreational cannabis products, with an approval contingent on whether there’s enough supply to continue providing for patients.
- The license fee is kept intentionally low, with applicants only needing to pay 20 percent of the fee at the time of submitting the application and 80 percent only if it’s approved. The total fees will range from $500-$2,000.
- Cannabis products must be in child-proof packaging with warning labels about potential health risks. Advertising is permitted, but with significant restrictions.
While the initial rules set forth by New Jersey’s marijuana legalization act provide the framework for the state’s new cannabis market, they are not all-encompassing. More specific regulations will be put in place for things like delivery services and wholesalers, and the rules themselves can still be amended over time.
New Jersey plans to utilize a substantial portion of its anticipated tax revenue derived from the adult-use recreational market to promote social equity initiatives. The proposed social equity excise fee would apply only to cannabis cultivators and remains a discretionary fee within the control of the Cannabis Regulatory Commission. A few of the categories of social equity programs that the CRC may recommend are (i) educational support for low-income families, (ii) economic development in the form of training and hiring, (iii) social support services to build community networks and facilitate child care, and (iv) legal aid in civil and criminal cases. The CRC may also recommend that it retain a portion of the social equity excise fee to administer startup grants, low-interest loans, application fee assistance, and job training programs through the Office. The CRC must obtain annual appropriations act approval before doing so.
The new legislation also provided for the establishment of the Office of Minority, Disabled Veterans, and Women Cannabis Business Development (the Office), housed within the CRC. The Office’s responsibility is to establish practices and procedures to promote participation in the recreational cannabis market by persons from socially and economically disadvantaged communities. The Office will be responsible for certifying businesses as minority-owned, women-owned, or disabled veteran-owned businesses. The Office will also be responsible for determining the effectiveness of the measures designed to promote diverse participation in the recreational cannabis industry.
Additionally, last month the New Jersey judiciary announced that it had vacated or dismissed nearly 88,000 marijuana cases since July 1, when the decriminalization law took effect mandating relief for people who have been caught up in prohibition enforcement. The courts said these are just the first of about 360,000 cannabis cases that are eligible to be automatically vacated, dismissed, and expunged.
It is apparent that New Jersey sought a path to ownership in the recreational cannabis marketplace for historically disadvantaged individuals and communities. Governor Phil Murphy further confirmed the state’s commitment to social equity by selecting Dianna Houenou, a leading expert on social equity issues, as the Chairwoman of the Commission.
A version of this story first appeared in Marijuana Movement. Article Link
About NDICA –
NDICA is a 501(c)(3) organization whose mission is to create an ethical and equitable cannabis industry to reduce barriers contributing to the lack of representation of those most impacted by the War on Drugs, including people of color and other marginalized community members.
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