NJ Cannabis Media -
November 26, 2018

10 questions about the future of marijuana in N.J.

Written by Marc Schwarz
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Photo Credit: MARC SCHWARZ

The hearings were held, the bills were voted on in committee. But there’s still a lot we don’t know about the future of the cannabis legislation and industry in New Jersey.

Here are 10 questions we’ll be looking for answers to:

Q. Does the legalization bill have the votes to pass the full Senate and Assembly? The great unknown. It needs 21 votes in the Senate and 41 in the Assembly and most legislators have not committed one way or the other. How much this hearing shifted any opinions is also unknown.

Q. Will the governor sign it? The best guess is that if the bill lands on his desk, Governor Murphy will issue a conditional veto so that any issues – tax rates, the Cannabis Regulatory Commission – can be worked on. During an unrelated press conference Monday, Murphy said he was “encouraged that it’s moving in the right direction. It’s too early to tell as it relates to exactly the elements that ultimately are written there. We’ll see, but happy to see the progress.”

Q. With no set cap on the amount of licenses, how many will be issued? An earlier draft of S2703 called for a maximum of 218 licenses. The current language states that “the commission shall issue a sufficient number of Class 4 Retailer licenses to meet the market demands of the State. The same holds true for medical cannabis cultivators, manufacturers and dispensaries. The number, according to the legislation, will be “pursuant to need.” The commission will “periodically evaluate whether the number” of permits issued is “sufficient to meet the needs of qualifying patients in the State.” That means the commission has all the power – expect a cautious rollout.

Q. What happens to Jeff Brown and the Department of Health’s Medical Marijuana program? Brown, who is the assistant commissioner of health in charge of the medicinal marijuana program, has been widely praised by those in the industry. Several industry experts feel he is the ideal candidate to be the executive director of the Cannabis Regulatory Commission because of his knowledge and proven ability to expand the medical program.

Q. Do all businesses have to employ union labor? The bill calls for the commission to require all applicants – except for microbusinesses – “to submit an attestation signed by a bona fide labor organization stating that the applicant has entered into a labor peace agreement with such bona fide labor organization. … Failure to enter, or to make a good faith effort to enter, into a collective bargaining agreement within 200 days of the opening of a licensed cannabis establishment, other than an establishment that is a microbusiness, shall result in the suspension or revocation of the establishment’s license.”

Q. Who will be on the regulatory commission? We know the breakdown of the five members: a chairman appointed by the governor and approved by the Senate; two appointed by the governor; one recommended by the Senate president; and one recommended by the Assembly speaker. Who they will be, what industry experience (if any) they have and how they will work together will bear watching. At least one member “shall be a State representative of a national organization or State branch of a national organization with a stated mission of studying, advocating, or adjudicating against minority historical oppression, past and present discrimination, unemployment, poverty and income inequality, and other forms of social injustice or inequality.”

Q. What does “in, but not a part of” mean? The legislation defines the Cannabis Regulatory Commission as “created in, but not of, the Department of the Treasury.” That means it’s similar to the New Jersey Turnpike Authority, which is an independent commission created in the Department of Transportation.

Q. What cities qualify as “impact zones” which have preference as locations in the application process? Newark, Elizabeth, Jersey City and Paterson qualify on population criteria – which is 120,000 or more. Other qualifiers are municipalities that rank “in the top 33 percent of local governmental entities in the State for marijuana or hashish-related arrests;”  have a crime index total of 1,000 or higher based upon the indexes listed in the most recently issued annual Uniform Crime Report; and have an annual unemployment rate that ranks in the top 15 percent.

Q. What’s a cannabis consumption area? It’s either an indoor or outdoor location operated by a retailer or alternative treatment center. The indoor must be “separate from the area in which retail sales of cannabis items or the dispensing of medical cannabis” and the exterior structure must be “on the same premises as the cannabis retailer or alternative treatment center, either separate from or connected to the retailer or center, at which cannabis items or medical cannabis either obtained from the retailer or center, or brought by a person to the consumption area, may be consumed.”

Q. What’s the tax revenue going to be used for? The bill calls for the 12 percent tax to be deposited into the Cannabis Regulatory and Expungement Aid Modernization Fund to pay for the commission’s operations as well as to defray costs of the expungement process. Any remaining revenue “shall be deposited in the State’s General Fund.” What the costs are and how much general revenue is produced are numbers that will be closely monitored.

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