‘A lot of demand and limited supply’ — leaders on NJ’s start of recreational pot sales
By SOPHIE NIETO-MUNOZ
New Jersey Monitor
It’s been three weeks since New Jerseyans started heading to local dispensaries to pick up legal, recreational cannabis – the start of what’s expected to be a multi-billion dollar industry that launched nearly four years after lawmakers began seriously discussing marijuana legalization.
And in front of Senate President Nicholas Scutari (D-Union) and the Senate Judiciary Committee on Tuesday, industry leaders and marijuana advocates discussed the pace of setting up the Garden State’s recreational market, scrutinized pricing issues, and griped over still-unwritten regulations for employers seeking clarity on when they can and can’t discipline employees who use cannabis.
“We’ve known from the beginning this would be difficult and ongoing work, but we are proud of the framework we have already put in place,” Jeff Brown, executive director of the Cannabis Regulatory Commission, told the committee.
Scutari, a legal marijuana supporter, called for Thursday’s hearing last month after the cannabis commission initially said it would not approve starting recreational sales. The commission quickly reversed its position and allowed a group of medical marijuana dispensaries to start selling recreational marijuana on April 21. Nearly $2 million worth of legal weed was sold to 12,000 consumers that day.
Brown was joined Thursday by Wesley McWhite, the commission’s diversity chief, and the two faced questioning from legislators for nearly two hours. Dianne Houenou, the commission’s chair, did not appear.
Lawmakers largely shifted their focus from why it took so long to get the recreational market started to the challenges the new industry is facing in New Jersey. Experts, lawyers, and advocates offered suggestions for smoothing out some foreseeable bumps in the road.
Over 900 entrepreneurs have applied for a recreational marijuana license, including for growing, manufacturing, testing, and selling. About 500 of those are pending, Brown said. So far, 102 conditional licenses have been awarded to recreational cannabis cultivators and manufacturers, which have a year to open.
“We have to keep working and you folks have to be nimble because this market is about to explode here in New Jersey,” said marijuana attorney Bill Caruso. “We have a new economy coming and it’s good to be on both sides of the ledger.”
Montclair had been home to the state's first medical marijuana dispensary, the Greenleaf Compassion Center, now operating as Ascend under new ownership. Ascend's plans to expand to recreational sales in Montclair were delayed, because the township hadn't yet completed an application process it could use to pursue a local license. But earlier this month, the Montclair Township Council voted to signal its support for Ascend's expansion to recreational sales, allowing the company to pursue a state license while the township completes work on its own local application process.
Legal weed is expensive, but still no home grow
On the black market, people can pick up an eighth of an ounce of weed for between $40 and $50. But at New Jersey’s dispensaries, that will run customers as much as $65 — nearly $400 for an ounce of cannabis.
The cost is one of the biggest setbacks the industry is facing, and experts say part of the issue is high demand and limited supply. Just 12 dispensaries are selling recreational marijuana statewide, and all of them also serve people using medical marijuana.
“We have a lot of demand and limited supply, and so it’s really about getting new businesses licensed, giving opportunities to new entrepreneurs to serve consumers, and that’s what we’ve been focused on doing,” Brown said.
Brown added more staffing would help, which is why the agency is asking for $17 million in Gov. Phil Murphy’s proposed budget, under review by lawmakers.
The lack of edibles in the Garden State was also a topic Thursday. In dispensaries, people can find flower, oils that can be vaped or ingested, and limited gummies. Concentrates, known as shatter or dabs, have also been approved for sale in New Jersey but are not yet available.
Baked edibles like cookies and brownies aren’t allowed under the current law, Brown noted, and any change to that would need to be approved by the Legislature.
“There are ingestible avenues to purchase and consume, and we hope to expand those in the future. I don’t have a specific timeline,” Brown said.
“I’ll call you on that,” Scutari replied.
Sen. Troy Singleton (D-Burlington) suggested home grow, which would allow marijuana consumers or medical patients to grow cannabis in their own homes. New Jersey is the only state with a recreational market that doesn’t allow medical marijuana patients to grow cannabis at home, and it remains a third-degree crime.
While Singleton wanted to know if home grow would help bring down some prices by adding supply, Brown shot down the topic. The state Legislature would need to pass a new law allowing people to grow marijuana plants, an effort that has previously failed.
“It’s something advocates are passionate about … I know it’s an issue, it’s obviously outside of the purview of the CRC,” said Brown.
More direction for employers
Lawmakers wanted more answers on what the cannabis commission is doing to help employers worried about their workers being impaired on the job.
While drug tests used to serve as a way for an employer to tell who is using illegal substances, marijuana can remain in someone’s system for up to four weeks. That makes it impossible to know whether they smoked a joint before coming to work or last month.
Under the law, employers can still ban marijuana at work and drug test in advance of employment, but can no longer fire someone based on a positive drug test for marijuana.
Ray Cantor, vice president of the New Jersey Business and Industry Association, criticized the cannabis commission for not creating standards for the business community to follow for when an employee can be fired. He said businesses are “still operating in the dark over this issue.”
The commission is planning to issue guidance on how employers can review and discipline employees through a workplace impairment recognition expert. It’s a new job required in the law to conduct field sobriety tests.
Those regulations haven’t come down yet. Brown said the commission is hoping to handle them soon, but needs to focus on the launching of the recreational industry first.
Brown explained the commission is meeting with the New Jersey State Police, which oversees the training of drug recognition experts who perform marijuana sobriety tests. It’s unclear what the regulations would require, but some lawmakers have suggested carveouts for some workers.
“That’s a piece that I think has to be worked out. Now that we have legalized the use of cannabis and you have various industries — law enforcement, the airline industry, there’s a whole host of operating heavy machinery — we need to have a process in place in which employers can follow the regulations … they’ve been given to enforce,” said Sen. Tony Bucco (R-Morris).