NJ Cannabis Media -
January 7, 2019

New year, same issues: Latest on legislation, new license winners

Written by Marc Schwarz
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The calendar may have turned from 2018 to 2019 but that doesn’t mean anything else has when it comes to the cannabis industry.

Issues with tax rates, expungement, structure of the regulatory commission and getting Governor Phil Murphy and the statehouse leadership on the same page continue to hold up passage of three marijuana-related bills.

And just because licenses have been awarded doesn’t mean the six new medical marijuana facilities will be opening any day now.

Legislation

Circle Thursday, Jan. 10, as a key date. It’s scheduled to  be the second sit-down in the last few weeks between Murphy, Senate President Stephen Sweeney and Assembly Speaker Craig Coughlin. Marijuana legislation is reported to be one of the key talking points after the minimum-wage bill.

Odds are not high that they will leave that meeting with an agreement, but the sense is that progress is being made, according to several industry insiders.

The issues remain the same:

Tax rate: Sweeney wants it closer to 12 percent and Murphy seeks it more in the 25 percent range. Logic would say, split the difference. So far, that hasn’t happened.

Expungement: It’s an issue that everyone agrees on – it’s the details that are causing delays. Specifically, who and how will it be paid for.  “The most important thing from a social justice point of view is we will need resources to make sure we can do all the expungements. It is my hope that if they do go down this road that the social justice expungement piece will be part of the new legislation,” Attorney General Gurbir Grewal said in an interview with WCBS 880.

Regulatory commission: This is apparently the biggest sticking point between Murphy and the statehouse leaders. How much power will it have? Senator Nicholas Scutari, a prime sponsor of the adult-use bill, made the case for a commission modeled after the casino regulatory agency in an op-ed on nj.com: “In the ’70s, Governor Brendan Byrne established the New Jersey Casino Control Commission. The five-member commission brought autonomous regulatory oversight to the gambling industry. The authority of licensing and regulation was vested with the five commissioners and allowed the industry to adjust and operate fluently and efficiently. We would be remiss if we did not recognize the success of the Casino Control Commission as we plan the legalization of marijuana.”

Overall, there is optimism the bills will get passed in the first half of the year.

“First, an increase in New Jersey’s minimum wage, and then the legalization of marijuana will be approved by the Legislature and signed into law by Governor Phil Murphy — possibly before the April budget break, but probably before the new fiscal year begins on July 1. Marijuana advocates, in particular, have been methodically building public and political consensus for a long time, and it will finally pay off,” is what Micah Rasmussen, director of Rider University’s Rebovich Institute for New Jersey Politics, predicted to ROI-NJ.com.

Medical marijuana

How long will the wait be before any of the six new application award winners will open their doors?

Best estimate is second half of the year at the absolute earliest.

The awarding of the license is just a first step in the process. The six must now get approval for their operations and facilities from both the State Department of Health and the municipalities they will be in. Already issues have begun to crop up: The grow facility site for NETA NJ’s Phillipsburg is too close to a school and NJ Cannabis Media has learned that at least one of the winners has not been in contact with the municipality in which it was awarded a license, more than two weeks after the announcement.

And this is before the winning applications have been publicly released and potential lawsuits over scoring have been filed.

On the other hand, word is the Department of Health may not wait for medical marijuana expansion legislation to pass before issuing a next round of Requests for Applications.

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