The NJ cannabis implementation bill passed the Assembly Budget and Appropriations Committees today.
The Assembly Budget and Appropriations Committee began in the morning online while the Senate Appropriations Committee was scheduled for the afternoon in person, despite Governor Murphy’s restrictions to prevent COVID.
Both committees had scheduled a hearing for last Thursday but pulled them in the wake of widespread unhappiness. There were great fears it would only benefit large, out-of-state corporations.
Cultivation License Caps
A section of the cannabis implementation bill A. 21 was amended that limited the number of cultivation licenses allotted to 28 and raised to 37. Many were outraged there a cap was kept in place. A variety of lawyers, entrepreneurs, and advocates argued it would perpetuate the problems that already exist in the market. What’s worse, many of those have already been allocated to the current dispensaries.
The New Jersey Cannabis Trade Association (NJCTA), a trade association that represents the dispensaries that have already won a license, submitted testimony that said acknowledged the need to end the War on Drugs and help entrepreneurs, especially minorities. They also said they want to maintain license caps in the cannabis implementation bill.
“The removal of cannabis license caps in Oregon flooded the market with more cultivators and retail locations than the market could handle, and subsequently crashed the price of cannabis, making it exceedingly difficult for all but the largest operators in the state to compete. The state’s legislature later had to change course and cap licenses once again,” they said.
“When cannabis is taxed earlier in the supply chain instead of just at the point of retail sale, that cost is carried through on all products, including medical cannabis,” they said. “All adult-use taxes must be kept at the point of retail sale so that taxes intended to be levied only on adult-use products are not passed along to patients,” they added.
“The increased prices of medical cannabis can be extremely detrimental to affordable access. Cannabis operators are already operating at a major disadvantage due its Schedule I designation under the Controlled Substances Act, which invokes section 280E of the federal tax code and does not allow cannabis operators to deduct the costs of doing business. These costs add up very quickly for operators and often end up being partially passed along to the consumer.”
Minority Cannabis Business Association (MCBA) President Jason Ortiz was unhappy that amendments were introduced last minute that could not be examined.
“It’s like having a test on info we couldn’t study,” he said. “Would you vote on a bill you couldn’t see the language?”
Many emphasized the need for a just small business program, including defining who will receive a cannabis business license.
The cannabis implementation bill will likely pass the full legislative chambers on Monday the 23rd.
Creating a Just Industry in the Cannabis Implementation Bill
Nadir Pearson, President of SMART, a student cannabis reform group, said corporations consistently find loopholes in rules design to help minority entrepreneurs.
Committee Chair Jon Burzichelli (D-Gloucester, Salem) emphasized the need to help impacted communities and create an industry. He said there is a way for micro-businesses to grow to full status in response to advocate and lawyer Jessica Gonzalez, who testified.
James Jackson said there is a need to define applicant status and reiterated the need for homegrow despite legislators’ refusal to engage on the issue. Jackson noted they should listen to the advice of Leo Bridgewater and Gonzalez.
Cannabis entrepreneur Frank Beatrice emphasized the need for New Jerseyans to receive cannabis licenses versus people from out of state.
“Today’s amended cannabis legalization bill includes an extremely important step forward: a social equity excise tax that will fund financial reparations for communities of color devastated by the drug war,” said Rev. Charles Boyer of Salvation and Social Justice.
However, he was not wholly satisfied with the bill. “This bill still lacks firm, codified language that guarantees that funding from the excise tax is reliably allocated with real community input to the state’s impact zones,” Boyer added.
Cannabis academic, advocate, and entrepreneur Joshua Alb lamented the lack of education on the plant. He noted that 15 percent of the cannabis implementation bill is allocated for minority entrepreneurs, and 15 percent is allocated for women entrepreneurs.
“Who are the other 70 percent?” he asked. “You have this pandemic… where white billionaires have gained half a trillion dollars … and this bill only continues that.”
“We gotta let the little guy get involved,” said Burzichelli.
Not everyone was in favor of a just cannabis implementation bill.
“We should not weaken critical areas,” said Ray Cantor, a lobbyist NJ Business Industry Association (NJBIA) who wanted amendments withdrawn that protect workers from being fired for random drug testing.
NJ Chamber of Commerce representative Laura Gunn concurred when she testified.
Patients and Crime
Sandra Rivera said she was arrested for possession of a quarter of cannabis in October.
“I’ve never had in any runs ins with the law,” Rivera said. “It’s so expensive to be in the medical marijuana program. I had to pay $350 for a therapist.”
“I hope we move the decrim bill to help you with the run-in you had,” Burzichelli said.
Rivera said she concurred with Gonzalez’s recommendations for a just market.
Jo Anne Zito of the Coalition of Medical Marijuana of NJ (CMMNJ) said the high price of medical cannabis has caused the death of patients and lamented she could not be patient herself.
Many advocated for the inclusion of homegrow in the enabling legislation.
“I think we will see a day when homegrow is approved. It’s just not today,” said Burzichelli. “Homegrow will eventually come.”