With the CRC Operational, When Will Recreational Cannabis Licenses Be Available in New Jersey?

The process of establishing New Jersey’s legal recreational cannabis market recently took a giant step forward...

The process of establishing New Jersey’s legal recreational cannabis market recently took a giant step forward. After months of delays, the Cannabis Regulatory Commission (CRC) is now up and running, having held its first public meeting on April 12, 2021.

“By applying the values of safety and equity, we will center our work around creating and protecting access for patients, promoting the production of safe products, and promoting diversity and inclusion in the industry to develop a national model for sensible, fair oversight,” CRC Chair Dianna Houenou stated during the meeting.

Cannabis Regulatory Commission

The Cannabis Regulatory Commission will oversee New Jersey’s existing medical cannabis marketplace, as well the soon-to-be-established adult-use recreational cannabis marketplace. The CRC was first established in 2019 under the Jake Honig Compassionate Use Medical Cannabis Act to oversee the state’s medical cannabis program, but was never fully constituted.

The Cannabis Regulatory, Enforcement Assistance, & Marketplace Modernization Act, Senate Bill No. 21, established the CRC to oversee the state’s recreational and medical marketplaces. As set forth in the statute, it must adopt rules and regulations governing key aspects of the industry, including:

• Procedures for the application, issuance, denial, renewal, suspension, and revocation of the six classes of cannabis licenses;
• Security requirements for marijuana establishments;
• Requirements to prevent the sale or diversion of marijuana and marijuana products to underage persons;
• Labeling and packaging requirements;
• Health and safety regulations and standards for the manufacture and sale of marijuana products;
• Advertisement restrictions;
• Record-keeping requirements; and
• Civil penalties for the failure to comply with the regulations.

For prospective licensees, the CRC will determine the maximum number of licenses for each class based upon market demands. It will also score applications based upon a yet-to-be-determined point scale, with the CRC determining the amount of points, the point categories, and system of point distribution by regulation, subject to some required criteria for consideration in the point scale, such as an analysis of an applicant’s operating plan, environmental plan, and safety and security plans. 

Composition of Cannabis Regulatory Commission

The Cannabis Regulatory Commission consists of five members appointed by the Governor, with one each upon the recommendation of the Senate President and the Speaker. The initial three appointments made solely by the Governor are direct appointments serving terms of three, four, and five years, and subsequently are subject to advice and consent.

Dianna Houenou, who served as Senior Policy Advisor and Associate Counsel to the Governor, will chair the five-member commission.  Jeff Brown, who served as Assistant Commissioner at the New Jersey Department of Health, overseeing the Division of Medicinal Marijuana, will serve as the CRC’s Executive Director.

Additional commissioners include social worker Krista Nash, former Verizon Vice President for External Affairs Samuel Delgado, and Department of Health Director of Policy and Legislative Services Maria Del Cid. In response to pressure from the NAACP, which raised concerns about Gov. Murphy’s failure to appoint a Black man or a member of a social justice organization to the CRC, the Governor appointed Charles Barker, an aide to Sen. Cory Booker, to fill the final seat.

First CRC Meeting

The first CRC meeting, held on April 12, 2021, was brief and largely consisted of addressing procedural matters. The CRC elected Sam Delgado as Vice Chair, adopted an official logo, and voted to transfer oversight authority for medical marijuana from the Department of Health to the CRC. The CRC also established a Plan of Organization, which will include an Office of the Executive Director, Office of Diversity and Inclusion, Office of Compliance and Licensing, Office of Patient and Customer Service, and Office of Business and Data Analytics.

Once the CRC addresses operational and staffing issues, it will focus on its primary task — drafting regulations. “The legal industry, as well as the expanded medical industry, come down to regulations, and we have our work cut out for us on that front,” CRC Executive Director Brown said.

Finally, the CRC established it meeting schedule for the remainder of 2021. The next meeting is scheduled for April 22 at 10:30 a.m. The link to attend virtually will be available here. To keep the public informed about its activities, the CRC has also launched its own Instagram, Facebook, and Twitter pages.

Clock Ticking on Recreational Cannabis Licenses

Now that the CRC has officially launched, the clock is ticking for the commission to enact recreational cannabis regulations. The legalization legislation signed into law in February requires to CRC to act expeditiously.

The CRC must adopt rules and regulations for the adult-use market within 180 days of the law’s enactment, which is August 21, 2021. Within 30 days of the rules and regulations being adopted, or September 21, 2021, the CRC must begin processing licensing applications.

The legalization statute also establishes timelines for approving licenses. The CRC must make decisions on conditional licenses by October 21, 2021. Decisions on other licenses must be made by December 20, 2021. Finally, adult-use sales must begin within six months of the CRC adopting rules and regulations, making February 22, 2022 the latest date sales can begin. While next February may seem like a long time from now, the New Jersey cannabis industry is poised for a busy several months leading up to the first legal sales. Once the CRC establishes licensing requirements and releases an RFA, interested businesses must be prepared to act quickly.

If you have questions, please contact us

If you have any questions or if you would like to discuss the matter further, please contact me, Dan McKillop, or the Scarinci Hollenbeck attorney with whom you work, at 201-896-4100.

This article is a part of a series pertaining to cannabis legalization in New Jersey and the United States at large. Prior articles in this series are below:

• Understanding How New Jersey’s Recreational Cannabis Law Impacts Employers
• Will New York Legalize Recreational Marijuana This Week?
• Is It Easy to Become a New Jersey Cannabis Dispensary?

Disclaimer: Possession, use, distribution, and/or sale of cannabis is a Federal crime and is subject to related Federal policy. Legal advice provided by Scarinci Hollenbeck, LLC is designed to counsel clients regarding the validity, scope, meaning, and application of existing and/or proposed cannabis law. Scarinci Hollenbeck, LLC will not provide assistance in circumventing Federal or state cannabis law or policy, and advice provided by our office should not be construed as such.