New Jersey Appellate Panel Confirms Towns Right to Regulate Cannabis Licenses

/ Justin Calta

The New Jersey Appellate Division recently affirmed a trial court’s decision to allow a New Jersey town to deny a prospective retail cannabis business to operate, determining that the municipality has the discretion to decide the necessary requirements for any cannabis retail businesses, and which cannabis retail businesses it chooses to support.

In December of 2022, a lawsuit was filed by Big Smoke LLC (“Big Smoke”), a prospective cannabis retail business, after the Township of West Milford declined to adopt a resolution in support of Blue Smoke’s cannabis retail operation in favor of another cannabis retail business in the same commercial complex. The lawsuit alleges that despite being granted a zoning permit for a retail store in December of 2021, Township officials did not adopt a resolution allowing Blue Smoke to move forward with operations in October 2022, required by the New Jersey Cannabis Regulatory Commission.

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New Jersey Approved Cannabis Consumption Lounges

/ Saiber LLC

The New Jersey Cannabis Regulatory Commission (NJ-CRC) approved regulations for cannabis consumption lounges during its January 17th meeting. These rules establish a framework for medical and adult-use operators seeking to integrate consumption spaces within their dispensaries. Upon approval by the New Jersey Office of Administrative Law, the rules will go into effect, with dispensary operators required to secure municipal approval for a consumption area to receive final clearance from the NJ-CRC.

The regulations mandate that consumption areas must be attached to a dispensary, limiting retailers to one consumption area regardless of the number of dispensaries they own. In addition, adequate ventilation through an HVAC system is mandatory to prevent smoke or vapors from affecting neighboring areas. Notably, the sale of food, alcohol, tobacco, or nicotine products within the consumption lounge is prohibited.

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NJ-CRC Accepting Licensing Applications for Wholesale, Distribution & Delivery for Social Equity & Diversity Owned Businesses

/ Saiber LLC

Applications for wholesale, distribution, and delivery of recreational cannabis licenses are now being accepted for Social Equity and Diversity Owned Businesses by the New Jersey Cannabis Regulatory Commission (NJ-CRC.) Beginning September 27, 2023, Social Equity Businesses will be given priority review and approval as the application opens for an exclusive 90-day period. Beginning on December 27, 2023, while still accepting applications from Social Equity Businesses, the application process for Diversely Owned Businesses will also be made available. Finally, the application process will be opened to all other applicants beginning on March 27, 2024.

Applicants will be able to apply for business licenses in the three below classes.

  • A Class 3 Cannabis Wholesale license allows the holder to store, buy, and sell bulk cannabis and cannabis products.
  • A Class 4 Cannabis Distribution license allows the holder to transport bulk cannabis and cannabis products between cannabis cultivators, manufacturers, or retailers within New Jersey.
  • A Class 6 Cannabis Delivery license allows the holder to transport retail-purchased cannabis and cannabis products to consumers.
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New Jersey CRC Approves Rules for Cannabis Consumption Lounges

/ Saiber LLC

In a recent meeting, the New Jersey Cannabis Regulatory Commission approved proposed rules that will allow for the operation of cannabis consumption areas in New Jersey, more commonly referred to as cannabis lounges.

As part of the approved rules, cannabis retailers seeking to operate a consumption lounge will require both NJ-CRC approval and municipal approval. Lounges may be indoors or outdoors but must be enclosed.

Lounges must also require guests to be 21+ years of age and cannot over-sell to its consumers. While no food sales will be allowed at lounges, consumers may bring food or have it delivered to the consumption area. Alcohol and tobacco consumption is prohibited.

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New Jersey CRC Recommends Eliminating Cap on Cultivation Licenses

/ Justin Calta

New Jersey’s Cannabis Regulatory Commission (CRC) recommended eliminating the current cap on the number of cannabis cultivation licenses at its February 8, 2023 meeting, among other actions.  If that recommendation is adopted, the current limit of 37 licenses would expire on February 22, 2023.   According to the CRC, there are only 17 cultivation licenses and awarding additional licenses would help spur New Jersey’s cannabis market.

“The market is developing, and we don’t want to hinder that. The New Jersey canopy is currently only 418,000 square feet – far below the average of other states with legal cannabis. New Jersey currently has only one cultivation license for every 197,000 residents. The national average is one license for every 31,000 residents. We have a lot of room to grow. We expect that lifting the cap will open the space for more cultivators, ultimately resulting in more favorable pricing and better access for patients and other consumers,” Commissioner Maria Del Cid-Kosso stated. 

New Jersey Enacts Bill Permitting NJEDA to Make Financial Incentives Available to Certain Cannabis Businesses

/ Justin Calta

The continuing federal prohibition of marijuana has made cannabis entrepreneurs in New Jersey rely on personal funds or private financing to get their projects up and running.  This has put up a significant barrier to entry into the market for many license applicants. In effort to free up financing while various bills continue to be introduced at the federal level, Governor Murphy signed bill S2945 on June 30, 2022, enacted as P.L.2022, c.48., which permits the New Jersey Economic Development Authority (NJEDA) to extend financial incentives to certain cannabis businesses as detailed below. 

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Bringing it all Back Home: Cannabis and Zoning

/ Justin Calta

Source: The New Jersey Law Journal

I. Introduction

New Jersey’s recreational cannabis market is finally here and in full swing.  As the market continues to grow, cannabis license applicants must consider how zoning will impact their contemplated business operations in any given New Jersey municipality.  In short, although a license may permit you to operate a cannabis business, zoning will dictate where, when, and “how” – – that is, what conditions are attached to your operation.

To aid applicants in the real estate and zoning component of their businesses and cannabis license applications, this article broadly details the relevant zoning provisions of the Cannabis Regulatory, Enforcement Assistance, and Marketplace Modernization Act (CREAMMA or the Act) and New Jersey’s Municipal Land Use Law, the primary zoning legislation in New Jersey, together with issues that both applicant and lawyer alike should consider when applying to a land use board to obtain approval.

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New Jersey Cannabis Regulatory Commission Sets Licensing Application Dates for Cannabis Businesses

/ Saiber LLC

The New Jersey Cannabis Regulatory Commission recently announced their application process for prospective cannabis businesses, including the dates the Commission will begin accepting applications for growers, processors, testing labs and dispensaries.

The Commission will begin accepting applications for personal use (recreational) cannabis businesses on December 15, 2021 for Class 1 Cultivator Licenses, Class 2 Manufacturer Licenses and Testing Laboratories. Applications will begin to be accepted for Class 5 Retails (Dispensaries) on March 15, 2022.  Licensing applications will be accepted on a rolling basis with no deadline set to file. In addition, there is no limit on the number of cannabis business licenses that will be made available. However, the number of Cultivator licenses will be held to 37 until February 22, 2023.

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New Jersey Supreme Court Rules that Employees can be Reimbursed for Medical Marijuana Expenses

/ Saiber LLC

The New Jersey Supreme Court recently issued a significant decision in the area of cannabis law.  In Hager v MK Construction, the New Jersey Supreme Court affirmed that medical cannabis prescriptions are lawful under workers compensation, but that buries the lede.  The real impact of Hager is that the New Jersey Supreme Court addressed for the first time the friction between federal and New Jersey state cannabis law.   

The employer in this case did not want to reimburse a worker for medical cannabis prescriptions for an injury that occurred on the job.  MK Construction argued that the New Jersey Compassionate Use Act (the medical marijuana law in New Jersey) was preempted by the Federal Controlled Substances Act, setting up a showdown between state and federal law.

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Legalization of Cannabis in New Jersey Means Employers Should Revise Their Workplace Policies

/ Saiber LLC

On February 22, 2021, Governor Philip Murphy signed into law a trio of bills that collectively legalize adult use of recreational cannabis in the State of New Jersey.  The legalization of cannabis, more commonly referred to as marijuana, will have a significant impact on workplaces and institutions of higher education across the state of New Jersey.  Employers should contact legal counsel for guidance on revising their workplace policies to comply with the new law and ensure a safe and healthy working environment. 

The following are key points employers should consider to comply with the new Law.

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