The NJ cannabis industry is frustrated by the perceived lack of cannabis companies owned by Black businesspeople, along with delays in rewarding conditional licenses and opening the market.
Conditional licenses were designed to be easier to obtain since site control and town approval are not needed. That is supposed to make it easier for those with fewer resources to obtain.
“Out of the 56 licenses awarded to date, none has been awarded to a Black-owned business. People need to know what’s going on,” said NJ African American Chamber of Commerce President and CEO John Harmon Sr.
“I am outraged to hear that Black-owned businesses have been shut out of the state’s cannabis marketplace,” said Congressman Donald M. Payne, Jr. (D-NJ-10).
“It is false that none of the awardees are black-owned,” NJ Cannabis Regulatory Commission (NJCRC) Communications Director Toni-Anne Blake said.
“New Jersey has a chance to correct this inequality. Allow people abused by the system to finally benefit from it with a fair distribution of cannabis business licenses. Instead, we are seeing the same inequality with these licenses that we see in marijuana arrests,” Payne Jr. said.
Questions of Truth
Blake questioned their source of information.
Harmon said credible sources thoroughly researched public information and determined there were no black owners.
Darrin Chandler Jr. of Premium Genetics Partners said he thoroughly researched the owners based on the CRC’s information. He argued an African American license winner would have made themselves known. Or someone was used to hide the real owners of a company.
NJ CannaBusiness Association (NJCBA) President Ed DeVeaux said he spoke with one of the 2019 medical cannabis license winners. She is indeed a Black woman.
“Could we have done better? The answer is yes,” he added. “I think we are still short on the effort to award licenses to African Americans.”
“The CRC is committed to doing everything we can to facilitate a diverse cannabis industry. The only awards issued so far have been for medicinal cannabis businesses. The statutorily mandated RFA process for medicinal cannabis was substantially different from the process currently in place for recreational cannabis,” Blake said
Chandler noted the number of black-owned cannabis companies in the state cannabis markets is very low.
It’s why advocates are passionate about creating a New Jersey cannabis industry featuring small businesspeople along with numerous African American and Hispanic owners.
Missed Deadlines Delay NJ Cannabis Industry
Last week, Executive Director Jeff Brown noted at the NJ Cannabis Regulatory Commission meeting that “We’re a new agency still staffing up. It is unlikely we will hit the 90 days turnover.”
Staffing a government agency quickly isn’t easy, even under normal circumstances. It’s likely been made worse by the pandemic.
Brown made it clear none of the existing medical cannabis companies would be approved by the time the market was supposed to open. It was supposed to occur on February 21st, 2022, a year after Governor Murphy signed the referendum implementation law.
He noted that none of the medical dispensaries seeking to sell adult-use cannabis had secured town approval. That would enable the CRC to open adult-use sales in the NJ cannabis industry.
The legislation said the market was supposed to open six months after the interim rules were released.
According to the interim regulations regarding conditional licenses, “Not more than 30 days after the receipt of a conditional license application. The Commission shall make a determination on the application.”
“The rules, our work with external agencies, and our outreach efforts are meant to flatten obstacles to entry and encourage the broadest pool of applicants and awardees possible,” Blake said.
The date to start applying for a cultivation or manufacturing license was December 15th.
“A lot of people are doing business deals based on these deadlines,” Chandler said. “You’re putting small businesses in harm.”
Chandler, an African American man, applied in the 2019 round for a vertical license and lost. He is in the process of applying for a conditional cultivation license now. Chandler believes his experience will help him in the current round.
“You always gotta find the silver lining in an unfortunate situation,” he said.
Black-Owned Business Issues
Businesspeople need certainty to make decisions, Harmon noted. Uncertainties are left in the process.
“Real money is at risk,” he said.
The conditional license created by the CRC was designed to make applying easier, Chandler noted. However, most of the cannabis-friendly towns zoned only allow a limited number of cannabis companies in a few locations. So the only available properties will be quickly snatched by competitors.
For example, Chandler is from Hackensack in Bergen County, which only allows one adult-use cannabis dispensary.
Finding a good real estate location for a cannabis company remains the biggest hurdle for license applicants.
Chandler favored an idea by justice advocate Chirali Patel encouraging the CRC to hold an in-person town hall where questions would be answered.
“The CRC needs to expedite its review and award of the licenses submitted. Minimally, the CRC must immediately score and notify applicants of their conditional status,” Harmon said. “If necessary, additional resources must be allocated to the license review process. So that applicants cease to be adversely impacted financially by an unjustifiably protracted process.”
“We urge Governor Murphy to exert his influence to speed up the licensing process. Award licenses to Black entrepreneurs in the name of social justice,” he added.
While passionate Chandler understands the issues the CRC is dealing with and believes their hearts are in the right place.
“We all have the same goal. We’re just going about it the wrong way,” he said.
“By and large, the CRC is doing its best,” DeVeaux said. “Do I want an adult-use and expanded medical market? Yes. But I’d rather have it done right than soon.”