MJBizMag January 2021 - 55

NEW JERSEY
Business-Friendliness Score:
3 out of 5 leaves
The widely anticipated legalization of
adult-use marijuana along the densely
populated East Coast is tempered in New
Jersey by high fees and limited licensing
availability. Sales in this heavily regulated
market are expected to grow quickly,
however, buoyed in part by visitors from
nearby states that have yet to legalize
adult-use marijuana.
Milestone: Voters approved a
referendum in November to legalize
recreational marijuana by a margin of
66.3% to 33.7%.
Initiative: Public Question 1.
Market Data: Marijuana Business
Daily projects the adult-use market will
generate $850 million to $950 million in
annual retail sales by 2024.
New Jersey has a restricted medical
marijuana market. The state has issued
only 12 vertical licenses, and just 13
dispensaries were in operation as of
Nov. 30.
State lawmakers approved an
expansion to issue a mix of 24 additional
MMJ licenses, but the licensing has been
held up by litigation.
Companies in the Market: Multistate
operators have a strong foothold in the
market, partly through acquisitions.
MSOs with licensed operations in
New Jersey include Acreage Holdings,
Columbia Care, Curaleaf, Green Thumb
Industries, iAnthus and TerrAscend.
Big Picture: The New Jersey vote is
expected to put pressure on other states to
follow suit across the Northeast and down
the East Coast, including Connecticut,
Delaware, Maryland, New York,
Pennsylvania, Rhode Island and Virginia.
Legalization in the densely populated
region would create billions of dollars
in business opportunities for planttouching
marijuana companies and
ancillary businesses such as makers of
cultivation and procession equipment,
consultants and law firms.
One potential hurdle: New Jersey's
limited medical cannabis market could
make it difficult to flip the switch to adult
use and create enough supply to meet
pent-up consumer demand.
Several operators are busy preparing
for a recreational market by expanding
cultivation and processing capacity.
Key Details: Lawmakers passed an
implementation bill Dec. 17. Provisions
include:
* The state's 12 licensed medical
marijuana operators will be fasttracked
into the adult-use market
but first must show they can meet
MMJ demand.
* Cultivation licenses will be limited
to 37 for the first two years of
the program. The exception is
microbusinesses with 10 or fewer
employees. The program is designed
to offer plentiful opportunities to
microbusinesses owned by residents.
* Priority consideration also will
be given to applicants living in
" impact zones, " or areas affected by
high jobless rates, poverty or past
marijuana enforcement activity.
* Priority consideration in general
will be given to minorities, women,
disabled veterans and residents of
at least five years with significant
investment interest in an entity.
* Labor peace agreements are
required except for microbusinesses.
* Adult-use sales will be taxed at
7%, and the Cannabis Regulatory
Commission has the option of
assessing a small grower tax.
* 70% of the sales tax revenue and the
possible grower tax revenue will go
to programs that assist individuals
and communities disproportionately
impacted by the war on drugs.
* Municipalities would have 180 days
to decide whether to ban adultuse
operations. They could pass
ordinances to charge local sales
taxes of up to 2%.
- Jeff Smith
January 2021 | mjbizdaily.com 55
http://www.mjbizdaily.com

MJBizMag January 2021

Table of Contents for the Digital Edition of MJBizMag January 2021

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