201-470-4181April 1, 2021
Now that Adult Use Recreational Marijuana Use in New Jersey is legal here are the details and how you can enter the market and obtain a license.
By N.A. Pagliara, Esquire of Pagliara Law Group, P.A. posted in Marijuana Law Blog, on Friday, April1, 2021.
Home to nearly 9 million people, New Jersey is now the gold rush or should we say the green rush with other sates such as New York to look up to. Start ups, investors, savvy business persons, operators, pharmacists, doctors, and entrepreneurs have laser focus and are preparing and working with attorneys to enter what is sought to be predicted to be a billion-dollar adult use industry in New Jersey. The tri-state area with New York and Pennsylvania New Jersey is set to boom and cash in the cannabis movement sweeping the nation. With limited licenses carrying unlimited potential for growth and profit, the emerging adult use marijuana market in New Jersey is set to be one of, if not the quintessential, competitive cannabis markets in the United States.
Maybe you are not looking to set set up a delivery service to deliver marijuana but you want to set up another type of businesses. There are 6 types of classes that you may consider to open up a business as you can see in the list below.
Does this sound like you. Well the process is convoluted and not simple at all. It will be demanding and highly competitive in the application process. Everyone is interested to cash in on the new Gold rush. The value of the license will be high and highly sought after. The requirements are very rigid and the mistakes are easy to make and then the result could be being denied the license for all the hard work. Make sure you have the right lawyer on your side with the same passion as you. You are only as good as your team that you hire in helping you increases that chance.
Governor murphy signed into law on February 22, 2021 the A21 – “The New Jersey Cannabis Regulatory, Enforcement Assistance, and Marketplace Modernization Act”) and decriminalized marijuana and hashish possession (A1897). The Governor also signed S3454, which clarified marijuana and cannabis use and possession penalties for individuals younger than 21 years old.
He also set up a panel of 5 that is called the Cannabis Regulatory Commission. They have 180 days to set the guidelines and regulations for the specifics to setup the cannabis marketplace.
6 License Types
There are 6 classes of Licenses you can apply for to enter the market. Minorities, disabled and women owners are given preference as well as dispensaries.
- Class ! – Grower (grow, cultivate, and produce marijuana plants and raw materials)
- Class 2 – Processor (manufacture, prepare, and package marijuana items)
- Class 3 – Wholesaler (store, sell, and transfer marijuana items for resale)
- Class 4 – Distributor (transport bulk amounts of marijuana)
- Class 5 – Retailer (sell marijuana to consumers from retail store)
- Class 6 – Cannabis Delivery Service (home delivery courier for Cannabis Retailers)
Who will get the licenses and be given preference
The amount of licenses is not clear yet but it is forecasted that it will not exceed more than 37 cannabis grower licenses available, including any of the current Alternative Treatment Centers that receive endorsement licenses to grow cannabis for personal non-medical use.
It is forecasted that 30% of all issued licenses will be awarded to minority, women, and disabled-veteran owned applicants.
Moreover, 10% of each class of licenses will be dedicated to microbusinesses, which must be wholly owned by New Jersey residents and operate at a smaller footprint. Preference will be given to applicants looking to operate in an economic impact zone and those applicants who plan to hire workers living in economic impact zones (those areas most heavily affected by marijuana arrests and socioeconomic disadvantages).
Microbusiness Defined under New Jersey Cannabis Law:
“Microbusiness” means a person or entity licensed by the Cannabis Regulatory Commission as a cannabis [grower] cannabis cultivator, cannabis processor, cannabis manufacturer, cannabis wholesaler, cannabis distributor, cannabis retailer, or cannabis delivery service that may only, with respect to its business operations, and capacity and quantity of product:
- (1) employ no more than 10 employees;
- (2) operate a cannabis establishment occupying an area of no more than 2,500 square feet, and in the case of a cannabis [grower] cultivator, grow cannabis on an area no more than 2,500 square feet measured on a horizontal plane and grow above that plane not higher than 24 feet;
- (3) possess no more than 1,000 cannabis plants each month, except that a cannabis distributor’s possession of cannabis plants for transportation shall not be subject to this limit;
- (4) acquire and process each month, in the case of a cannabis [processor] manufacturer, no more than 1,000 pounds of usable cannabis [in dried form];
- (5) acquire for resale each month, in the case of a cannabis wholesaler, no more than 1,00 pounds of usable cannabis [in dried form], or the equivalent amount in any [other] form of manufactured cannabis product or cannabis resin, or any combination thereof; and
- (6) acquire for retail sale each month, in the case of a cannabis retailer, no more than 1,000 pounds of usable1 cannabis [in dried form], or the equivalent amount in any [other] form of manufactured cannabis product or cannabis resin , or any combination thereof.”
New Jersey cannabis regulations state that the characteristics of the microbusiness license are:
- 10% of cannabis licenses to be issued to microbusinesses.
- Microbusiness owners must be New Jersey residents who have resided in New Jersey for the past 2 years;
- 51% of the owners of the microbusiness must be residents of the town or the neighboring town where the microbusiness will operate.
- No owner, director, officer, or other person with a financial interest who also has decision making authority for a licensed cannabis establishment, distributor, or delivery service, whether or not a microbusiness, can hold any financial interest in a microbusiness
100 percent of the owners of the business must be a New Jersey resident and have lived there for at least 2 years. This is opposite from the medical marijuana side with dispensaries as the resident requirement does not apply there. This new requirement applies to microbusinesses and is meant to protect against the big out of state companies from coming in to do business in New Jersey.
Tags and Topics: Cannabis, Marijuana Law, Hemp, Business Law, Marijuana Delivery
AUTHOR: Nicholas A. Pagliara, Esq. Founder, Chairman of the Board and Managing Attorney of Pagliara Law Group, PA.
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