New Jersey’s Path to Marijuana Legalization
New Jersey’s newly elected Democratic Gov. Phil Murphy touted the economic and social-justice benefits of legalizing cannabis during his campaign last year. While Assemblymember Reed Gusciora’s measure would allow home cultivation, state Sen. Nicholas Scutari’s wouldn’t. In one of his first moves in office, Gov.
Murphy ordered a study of expanding the state’s largely ineffective medical-marijuana program, which should be completed by March. Legal recreational cannabis will most likely not be on store shelves in the Garden State until 2020. The anti-pot group New Jersey Responsible Approaches to Marijuana Policy praised the move. To answer questions from influential politicians such as state Sen. Ron Rice, the NJCA has set up a meeting in Trenton on February 24 with CNN chief medical correspondent Sanjay Gupta, the American Civil Liberties Union, a retired Drug Enforcement Administration agent and others.
On Feb. 7, Gov. Murphy and other New Jersey lawmakers went on a fact-finding trip to Las Vegas to study Nevada’s cannabis laws. Rudder cites research that show a 25% drop in opioid overdoses and reduced alcohol use in states with legal cannabis. To win licenses, cannabis businesses will be required to reveal their founders’ tax returns and show employee manuals, business and quality-assurance plans, accounting procedures, and security and badge systems to limit employees’ access to cannabis. Despite these challenges, the state’s cannabis supporters sense positive change is ahead.
Heather Kumer, a law associate at Connell Foley, said reform has been on her radar since she joined Students for a Sensible Drug Policy in 2004 when she was in college and asked Democratic presidential candidate John Kerry a question about legalization. David Lande, a Democrat who lost in his attempt to win a state Senate seat in central Jersey last November, now wants to get into the extraction side of the business. He’s not sure how long it will take to win over reluctant state officials.
‘Sparse’ marijuana market expected
The CCC on Tuesday approved another 16 economic empowerment applicants and two registered marijuana dispensary companies to have their license applications reviewed on an expedited basis. Even as the CCC announced that 25 prospective marijuana businesses have submitted a license application, Chairman Steven Hoffman said municipal roadblocks and issues around ensuring a supply of marijuana could limit the initial size of the industry. Before the CCC will approve a license, the applicant must demonstrate that they have held a community meeting and executed a host community agreement with the city or town. Many towns across the state have imposed moratoria or bans on retail marijuana shops, further complicating things as businesses try to get off the ground. Before any business can open, it needs to secure a supply of marijuana to sell.
Only RMDs are allowed to grow marijuana commercially and new licenses for cultivation will not be approved by the CCC until at least June 1. The Boston Globe reported in March that at least 189 of the 351 municipalities have banned retail marijuana stores and most have also imposed restrictions on other marijuana businesses. The CCC approved another 18 applicants for its priority license application review program, bringing the total number of applicants who can skip to the front of the line when the CCC begins reviewing license applications to 148 – 79 RMDs and 69 economic empowerment applicants. Those approved for priority review can submit their license application at any time, regardless of which type of license they are seeking. The CCC began on Tuesday accepting license applications from anyone interested in licenses for cultivation, craft marijuana cooperatives, microbusinesses, transporters and independent testing labs.
Marijuana retailers and product manufacturers that have not been approved for priority review will be able to apply for licenses beginning June 1. The CCC cannot legally issue a license until June 1 and expects legal sales to begin July 1.
Big-name investors pour millions into marijuana
Wealthy investors are pouring tens of millions into the cannabis industry in a bid to capitalize on the gold rush that’s expected when California legalizes recreational marijuana on Jan. 1. In the first public endorsement of the industry from a major biotech investor, Thiel’s Founders Fund has sent millions to Privateer Holdings, a Seattle private equity firm that backs research into medical marijuana products, among other cannabis-related ventures. Experts say the market for marijuana and related products in California will reach $6.5 billion in 2020, and likely spark legalization efforts elsewhere. Given that most states have already legalized cannabis for medical use, and seven states plus the District of Columbia allow recreational use, most investors think that federal officials eventually will relent and regulate marijuana more like alcohol. Los Angeles-based private equity firm MedMen has raised about $80 million for cannabis projects in the last year.
Nearly half of all investments into cannabis companies nationally come from California, according to the finance-tracking firm Pitchbook. That’s no surprise to Ben Larson, founder of Gateway, a cannabis business incubator in Oakland. Arcview has helped about 600 wealthy individuals invest more than $131 million in cannabis companies since 2010. It would circumvent federal strictures that prevent cannabis businesses from securing traditional loans – and if it works, could open the floodgates of investment. His investments have included vaporizer companies and Meadow, a website and delivery service that helps customers compare marijuana products.
Even Dora, Paxhia’s rescue dog, has joined the revolution: Pet pot nibbles from Oakland-based Treatibles – dosed with CBD, a chemical in cannabis that is not intoxicating – help her chill out, quelling anxiety that led to late-night barking, he said. As with medical marijuana for humans, the FDA has not approved any form of cannabis for pets.