Montclair could have up to two recreational marijuana retailers and five other cannabis-related businesses under a package of regulations the Township Council introduced Tuesday night.

Council members voted 4-2, with 1 abstention, to introduce three related ordinances. If the council eventually adopts the ordinances, with a final vote expected on Aug. 10, it’ll also restrict where in town recreational marijuana businesses can be located. 

They’d be allowed closer to schools than the 1,000-foot buffer traditionally established for so-called “drug-free zones” — the state no longer considers marijuana a controlled dangerous substance. The township would let the businesses operate 8 a.m. to 11 p.m. every day of the week, and collect taxes from sales.

Towns are facing a deadline of Aug. 21 to either bar recreational marijuana sales, or to allow them and set up regulations for where and when they can operate, and how many establishments can be licensed. 

If Montclair doesn’t act by then, Township Attorney Ira Karasick has said, cannabis businesses and services could automatically be considered permitted uses in commercial zones, and the township wouldn’t be able to prohibit licensees from moving into town for five years, he said.

Under the Montclair ordinances, the township would be able to issue two cannabis retailer licenses and one of each for a cannabis delivery service, cannabis wholesaler, cannabis distributor, cannabis manufacturer and cannabis cultivator. For now, Montclair would not allow for on-site consumption. Karasick said the council could increase these numbers in the future, but could not reduce the number of licenses. 

Mayor Sean Spiller, who served this year on a committee to work on the cannabis regulations with Councilman Peter Yacobellis and Councilwoman Robin Schlager, said Montclair is starting out conservatively as it sets the number of licenses allowed and the places where businesses can be located. 

“We will let the market dictate where this will go,” Spiller said.

On Aug. 22, the New Jersey Cannabis Regulatory Commission will publish its rules and regulations for the legal recreational marijuana industry. Councilman David Cummings suggested Montclair opt out for now, and then opt in after the guidelines. Both he and Deputy Mayor Bill Hurlock voted against the introduction of all three ordinances.

Councilman Bob Russo, who said he supports legalized recreational marijuana use, abstained, hoping that the introductory vote would be put off until the council next meets on July 20, allowing for more conversation. Karasick said amendment suggestions could still be made before the July 20 meeting. 

Businesses seeking licenses in Montclair would first have to gain licensing from the state commission, which will begin accepting applications after publishing its rule. 

Businesses seeking licenses in Montclair would first have to gain licensing from the state commission, which will begin accepting applications on Aug. 22.
Martijn Baudoin via Unsplash
Businesses seeking licenses in Montclair would first have to gain licensing from the state commission, which will begin accepting applications on Aug. 22.
Martijn Baudoin via Unsplash

Marijuana dispensaries are not new to Montclair. In December 2012, Montclair was the first town in the state to welcome an alternative treatment center — then Greenleaf Compassion Center, now Ascend — in which cannabis could be sold for medical uses only. However, the township never created any ordinances zoning the establishments or collecting taxes on sales. 

Chris Melillo, chief revenue officer at Ascend, told Montclair Local that the business is focused right now on ensuring patients’ needs are met, and will continue to prioritize patients and the community.

Another business, Lightshade Labs, applied to the township in 2019 to open an alternative care center at 369-373 Bloomfield Ave. In 2019, Township Planner Janice Talley wrote Lightshade a letter, saying at the time state law prohibited it from being within 1,000 feet of a school — Fusion Academy. However, Lightshade is set to return to the township’s zoning board Sept. 22.

Lightshade and about 150 other would-be medical marijuana dispensaries also saw their applications held up for more than a year in a dispute with the state Department of Health, but an appellate court ruled this year those applications can move forward. 

Spiller said that Montclair has had a positive experience with the existing medical marijuana center.

Officials in dozens of municipalities, including Nutley and Livingston in Essex County, have chosen to ban recreational marijuana establishments in their communities, with many saying they want to test the waters first. Others, such as Montclair and Bloomfield, are embracing a new marketplace they say will result in more tax revenue and employment opportunities.

“Right now our major income is property taxes and parking revenues. A local marijuana tax will bring in more revenue,” Yacobellis told Montclair Local prior to the meeting. 

He said he believes Montclair’s three ordinances “represent a measured and careful approach for what is a brand new marketplace, in a way that respects the will of the voters.”

In Essex County, voters overwhelmingly favored the legalization of recreational marijuana, 229,144 to 89,315, when the state put the matter up for a referendum in 2020. In Montclair, voters by a 4-1 margin voted to legalize recreational cannabis in New Jersey, Yacobellis said.

Zoning, taxes 

In the past, federal and state drug-free school zones made distributing, dispensing or possessing a controlled dangerous substance within 1,000 feet of a school a third-degree crime, but the recently adopted cannabis law changed the state’s definition of “controlled dangerous substance” to preclude legalized cannabis. This change means that a licensed cannabis facility could operate within the 1,000-foot drug-free school zone. But Federal law continues to identify all forms of marijuana as a Schedule 1 controlled substance.

Montclair’s proposed zoning for cannabis businesses would bar them from being within 250 feet of a school or child-care center. Council members reviewed a map showing 37 school locations and possible buffers of 250 to 500 feet before ultimately moving ahead with the 250-foot restriction.

The businesses would be allowed in the Central Business Zone on Bloomfield Avenue, the General Business and Light Manufacturing Zone, excluding Walnut Street, and the Neighborhood Commercial Zone, on Valley Road between Walnut Street and James Street.

Councilwoman Lori Price Abrams questioned why the zoning couldn’t be at least expanded to side streets along Bloomfield Avenue.

The Zoning Board, which next meets on July 21, still has to approve the zoning conditions, Karasick said.

How much tax revenue Montclair would take in remains to be seen, but with more dispensaries permitted in town and with current cannabis prices set at $50 to $60 for an eighth of an ounce, the township would have another revenue stream. 

State legislation allows for marijuana host municipalities to levy 1% or 2% taxes on transactions on top of the state’s 6.625% sales tax. Montclair would collect a tax on the receipts of cannabis sales or transfers of 2% for cannabis cultivators, manufacturers and retailers, and 1% for wholesalers.

Licenses would be granted for three years. The application fee would be $5,000, with annual renewals of $2,500, for delivery businesses and retailers. All other cannabis business applications would cost $10,000, with $5,000 renewals. 

State law requires all municipalities to allow for cannabis delivery, even if they opt out of allowing businesses in their town. Montclair would allow deliveries between the hours of 8 a.m. and 11 p.m., any day of the week.

Retailers can be open to the public during the same hours.

In the case of multiple applicants for the limited number of licenses, the Township Council would evaluate all applicants and issue a notification of award.

It would consider factors including the business’s ties to the community and whether at least one shareholder has lived in or had a business in Montclair for at least five years. The council would also consider the business’s commitment to provide benefits to the community, and its demonstrated commitment to diversity in its ownership and hiring practices.