NJ Awaits Closed Door Session to Determine Next Steps in Cannabis Legalization

Closed DoorThe final push to advance the cannabis legalization agenda will take place in a closed door session on Thursday, December 13.  At that time, the governor will meet with Senate President Sweeney and Assembly Speaker Coughlin to continue to negotiate certain nuances of cannabis legalization.  Front and center will be the proposed Cannabis Regulatory Commission, a state agency legislators want to create to control both the proposed recreational cannabis industry and the medicinal industry.

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Alex concentrates his practice on business litigation and counseling. Alex is the author of the New Jersey Cannabis Counsel blog where he tracks and analyzes developments in New Jersey’s efforts to legalize recreational cannabis and the potential impact on cannabis businesses in New Jersey. Alex is also a member of the New Jersey Cannabusiness Association.

Out-of-State Partnerships: What is a “Significantly Involved Person”?

New Jersey State Line

FLICKR/MATT HINTSA

Perhaps the most significant change in Sen. Scutari and Sen. Sweeney’s new adult use cannabis legalization bill is the change in residency requirements for cannabis license holders.  In earlier iterations of Sen. Scutari’s legalization bill, cannabis license holders had to be New Jersey residents for two years prior to the date of the license application.  The thought process behind this requirement was to prevent established cannabis businesses from jurisdictions that have already legalized cannabis from entering the New Jersey marketplace and establishing dominance before New Jersey citizens had an opportunity to gain a foothold themselves.

The new bill has changed that.  It creates a defined term known as a “significantly involved person” which essentially means a person or company with a 20% or greater stake in the company applying for a license.  § 9(a)(3) of the new bill states that “[a]n applicant shall have a significantly involved person or persons lawfully residing the State for at least two years as of the date of application to receive a license.” Continue reading

Alex concentrates his practice on business litigation and counseling. Alex is the author of the New Jersey Cannabis Counsel blog where he tracks and analyzes developments in New Jersey’s efforts to legalize recreational cannabis and the potential impact on cannabis businesses in New Jersey. Alex is also a member of the New Jersey Cannabusiness Association.

Sen. Sweeney Pushes for Legalization this Summer

New Jersey Democrats are now hopeful that a legal cannabis bill could be approved before Labor Day.  Even though the recent state budget passed without including tax revenue from adult use recreational cannabis, Senate President Steve Sweeney said that lawmakers are “rounding the corner on marijuana” and said that “the speaker and I are committed to getting the marijuana bills done this summer.  That’s our goal.”

Image of New Jersey State HouseSen. Sweeney’s comments suggested that preparing the budget actually made the cannabis discussion more difficult.  “I’m thinking late July, August, hopefully,” Sweeney said.  “Now that this budget’s out of the way, not that a lot of this stuff’s out of the way, all the noise is out of the way, hopefully the administration and we all can focus on marijuana.”

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Alex concentrates his practice on business litigation and counseling. Alex is the author of the New Jersey Cannabis Counsel blog where he tracks and analyzes developments in New Jersey’s efforts to legalize recreational cannabis and the potential impact on cannabis businesses in New Jersey. Alex is also a member of the New Jersey Cannabusiness Association.

The State of Cannabis Licensing in New Jersey: What Has Changed?

Image of Senator Nicholas P. Scutari (D) and Senator Stephen M. Sweeney (D)

Senator Nicholas P. Scutari (D) and Senator Stephen M. Sweeney (D)

This installment of New Jersey Cannabis Counsel dives into the new Scutari/Sweeney legalization bill (the “Bill” or the “New Bill”) and focuses on what was changed, and what was not changed,  from the predecessor bill (the “Old Bill”) when it comes to cannabis business licenses.

Our inaugural blog post addressed the first step for any legal cannabis business in New Jersey under the Old Bill: licensure.  The New Bill still requires licenses, but has slightly changed the overall licensing structure.  Currently, the New Bill proposes four cannabis licenses:

Class 1: Marijuana Grower License
Class 2: Marijuana Processor License
Class 3: Marijuana Wholesaler License
Class 4: Marijuana Retailer License

Followers of this blog and New Jersey’s efforts to legalize cannabis will be familiar with these licenses.  While the Old Bill had growing and processing under one license, all of the above types of cannabis businesses were included in the Old Bill.  More interesting is what was not included in the New Bill.

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Alex concentrates his practice on business litigation and counseling. Alex is the author of the New Jersey Cannabis Counsel blog where he tracks and analyzes developments in New Jersey’s efforts to legalize recreational cannabis and the potential impact on cannabis businesses in New Jersey. Alex is also a member of the New Jersey Cannabusiness Association.

Legalization Delayed, But Not Derailed

Governor Murphy promised legalized adult use cannabis as one of his first 100 days initiatives.  That time has come and passed.  So what exactly is the status of legal cannabis in New Jersey?

In early March, Gov. Murphy told New Jersey legislators that he wanted to legalize and tax cannabis before the end of 2019.  Money talks, and Gov. Murphy included $60 million in revenue from taxing the legal cannabis industry in his first budget proposal. Recently, however, Gov. Murphy has been less resolute about a legalization bill coming to fruition by his self-imposed deadline, saying that it was “too early to tell.”

Image of NJ Governor Phil Murphy and Senate President Stephen Sweeney

Gov. Murphy and Senate President Sweeney

That is not to say that legal cannabis will not happen in New Jersey.  The initial time frame was ambitious – perhaps overly so – but Gov. Murphy and Senate President Sweeney are still pushing for legalization. “There’s no reason to believe we can’t get there,” Gov. Murphy recently stated.  “This is not one you get overnight.  This takes time.  We’re in that process right now.”  Sen. Sweeney added “I don’t know if we’re going to be able to get it done in the budget session.  I was actually hoping to get it done in the first 100 days.  But we have work to do.  I think it’s time for us to really start putting a plan in place, have hearings, and for the governor to hold some town halls and draw more attention to it.”

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Alex concentrates his practice on business litigation and counseling. Alex is the author of the New Jersey Cannabis Counsel blog where he tracks and analyzes developments in New Jersey’s efforts to legalize recreational cannabis and the potential impact on cannabis businesses in New Jersey. Alex is also a member of the New Jersey Cannabusiness Association.

Municipalities Continue to Voice Opinions on Legal Cannabis

New Jersey’s efforts to legalize adult use recreational cannabis are moving forward, full steam ahead.  While Governor Murphy has somewhat walked back his pledge to sign a legalization bill into law in his first 100 days, he has stated that he is not deterred by Attorney General Sessions and continues to study how legal cannabis has operated in the eight jurisdictions where it is legal.  Moreover, Senator Scutari has reintroduced his legalization bill to the legislature and Deputy State Assembly Majority Leader Reed Gusciora, who co-sponsored Scutari’s bill, also plans to introduce his own competing bill in the coming weeks.  Gusciora’s bill is rumored to allow for home-grows and to limit the number of cannabis businesses who are given licenses.

Atlantic City Boardwalk

Notwithstanding this forward momentum, certain municipalities have launched preemptive attacks on legal cannabis.  The Ocean County Board of Freeholders is expected to approve of a resolution against the legalization of cannabis.  The Monmouth County Board of Freeholders passed a similar resolution last month.  These resolutions do not actually carry any legal authority – the proposed bill requires municipalities (towns) to make the decision about legal cannabis, not counties.  The resolutions are also seemingly premature given that the counties are implementing a ban before there is any consensus about what legal cannabis will actually look like in New Jersey.

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Alex concentrates his practice on business litigation and counseling. Alex is the author of the New Jersey Cannabis Counsel blog where he tracks and analyzes developments in New Jersey’s efforts to legalize recreational cannabis and the potential impact on cannabis businesses in New Jersey. Alex is also a member of the New Jersey Cannabusiness Association.

Ron Wyden Joins Booker Bill

Senator Ron Wyden (D-Ore.) recently announced that he is co-sponsoring the Marijuana Justice Act of 2017 (“the Booker Bill”), a bill previously introduced by New Jersey Senator Cory Booker.  The Booker Bill seeks to decriminalize marijuana across the nation and penalizes states with high arrest and incarceration rates with respect to marijuana related crimes.  The Booker Bill also seeks to establish a “Community Reinvestment Fund”, a fund comprised of monies not provided to states in violation of the disproportionate arrest rates.  The Community Reinvestment Fund will be used to provide funds to “reinvest in communities most affected by the war on drugs” and includes grants for job training, public libraries, community centers and other programs designed to enhance the community.  The Booker Bill proposes spending at least $500,000,000 for each fiscal year.

Booker_Wyden

Senator Corey Booker (D-NJ) and Senator Ron Wyden (D-Ore.)

Senator Wyden joined Senator Booker on a Facebook Live video to discuss the thrust of Bill and his co-sponsorship.  His position echoed Senator Booker’s, which was that both Senators viewed the Booker Bill as a vehicle to combat the disproportionate impact of the war on drugs on minority communities.

The Booker Bill is not likely to succeed.  Senator Wyden is only the second co-sponsor, after the Booker Bill was originally proposed in August of 2017.  Similar bills seeking major marijuana reform have not gained much traction.  Nevertheless, efforts such as those by Senators Booker and Wyden begin a national conversation on the issue of cannabis reform.

The Booker Bill will not likely have any material impact on New Jersey’s push to legalize recreational adult use cannabis.  We will provide updates if the Booker Bill gains additional co-sponsors.

Alex concentrates his practice on business litigation and counseling. Alex is the author of the New Jersey Cannabis Counsel blog where he tracks and analyzes developments in New Jersey’s efforts to legalize recreational cannabis and the potential impact on cannabis businesses in New Jersey. Alex is also a member of the New Jersey Cannabusiness Association.

New Jersey CannaBusiness Association: “Updates on Cannabis Laws & Business Opportunities in New Jersey”

On September 27, 2017, Saiber attorneys attended the New Jersey CannaBusiness Association event at Galloping Hills Golf Course in Kenilworth, NJ.  The event was a great opportunity for potential cannabis entrepreneurs to learn about the potential upcoming business opportunities in New Jersey from industry leaders. Over four hundred people were in attendance.  The event was sponsored in part by Athletes for Care, an organization advocating for the careers of retired athletes, which in part advocates for medicinal cannabis.  Former athletes Marvin Washington (New York Jets, Defensive End), Leonard Marshall (New York Giants, Defensive Lineman), Eugene Monroe (Baltimore Ravens, Offensive Tackle) and Riley Cote (Philadelphia Flyers, Left Winger) were present at the event and participated in panel discussions.

Logo of New Jersey Cannabusiness Association.

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Jeremy focuses his practice on regulatory and business law. He specializes in gaming-related corporate, regulatory, licensing and compliance matters. Prior to rejoining Saiber, Jeremy served as Executive Vice President, Regulatory & Business Affairs for Coastal Development, LLC, a developer, investor and operator in casino resorts and racetracks. In that role, Jeremy was responsible for the company’s legal affairs, government relations and compliance functions, as well as sourcing, negotiating and executing on a number of business transactions.

The First Step for any Recreational Cannabis Business in New Jersey

New Jersey State Senator Nicholas Scutari (D. Union) recently introduced Senate Bill 3195 (“the bill”) legislation to legalize the sale and consumption of recreational cannabis in the State of New Jersey.  There are several reasons to believe that the Act will, after deliberation and modification, be enacted into law.  First, polling data shows that the majority of New Jersey residents are in favor of legalization of cannabis.  Second, not only does legalization have general bipartisan support, but it also has the support of New Jersey Senate President Stephen Sweeney, who traveled to Colorado in 2016 with Senator Scutari and several other New Jersey legislators to observe Colorado’s highly successful recreational cannabis industry and returned with very favorable impressions.  Finally, Democratic gubernatorial candidate Phil Murphy has declared his support for legalization of cannabis in New Jersey.  The Republican gubernatorial candidate, Kim Guadagno, has not specifically taken a position on legalization of cannabis, but instead recently equivocated during a primary debate that she both favors decriminalization and supports Attorney General Jeff Sessions’ views on cannabis. Some version of the bill will probably be enacted in 2018.  It is entirely possible that if enacted, the bill will contain new or revised provisions that do not currently exist in the proposed legislation.  This post addresses the bill as presently written.

Picture of a courthouse in Newark.

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Alex concentrates his practice on business litigation and counseling. Alex is the author of the New Jersey Cannabis Counsel blog where he tracks and analyzes developments in New Jersey’s efforts to legalize recreational cannabis and the potential impact on cannabis businesses in New Jersey. Alex is also a member of the New Jersey Cannabusiness Association.