The New Jersey Economic Development Authority (NJEDA) announced the application for Phase II of its Cannabis Equity Grant Program for Social Equity applicants will open soon.
The application portal is opening on November 30th at 10:00 a.m.
The Seed Equity Grant will allocate up to $8 million in funding for 48 New Jersey cannabis entrepreneurs.
They will provide each winning New Jersey cannabis entrepreneur with a Seed Equity Grant of $150,000 and technical assistance.
Helping New Jersey Cannabis Entrepreneurs
The NJEDA is offering the largest grant of its kind in the nation. They designed the program to address the biggest issue hurting many New Jersey-born-and-raised cannabis entrepreneurs. Lack of capital or simply money.
The focus is to ensure the communities impacted by the War on Drugs have access to the cannabis industry and resources to flourish.
Thus, 100% of the Phase II Seed Equity Grant funding is for qualifying Social Equity applicants. It’s an increase from the 40% allocation in Phase I.
They need to have a conditional New Jersey cannabis license to apply.
“We are excited to see grant funding being used to help social equity applicants realize their entrepreneurship dreams,” NJ Cannabis Regulatory Commission (NJ-CRC) Chair Dianna Houenou said.
She noted they want to make the grants exclusively available to social equity businesses.
“NJEDA is setting the example for establishing equitable funding initiatives. NJ-CRC Commissioners and staff see the hopes and dreams of those cannabis entrepreneurs every day. We applaud every step that brings us towards making some of those dreams come true,” Houenou declared.
Social Equity New Jersey cannabis license applicants are defined as companies with the majority owned by those who have prior marijuana convictions and live in an Economically Disadvantaged Area (EDA).
The NJ EDA gave grants to some companies that were not majority New Jersey resident-owned in their initial grant round. However, strict qualifications exist to be an official Social Equity New Jersey cannabis license applicant.
Social Equity New Jersey Cannabis License Qualifications
According to the NJ-CRC, more than 50% of the ownership interest of the New Jersey Cannabis Social Equity license applicant or license holder must be held by one or more persons that:
- Have lived in an economically disadvantaged area for five of the preceding 10 years and
- At the time the initial application is submitted and based on the preceding year’s income, a member of a household has a household income that is 80 percent or less of the average median household income in the State, as determined annually by the US Census Bureau.
More than 50% of the ownership interest of the license has to be held by one or more persons who have been adjudicated delinquent for or convicted of, whether expunged or not, in this State, another state, or the Federal Government:
- At least two marijuana- or hashish-related disorderly offenses (misdemeanors) or
- At least one marijuana- or hashish-related indictable offense (felony).
Proof of New Jersey residency is required.
The NJ-CRC is closely monitoring the use of token applicants as fronts or pawns for wealthy interests via Management Service Agreements (MSAs) and Finances Service Agreements (FSAs).
Cannabis Equity Grant Progress
“Under Governor Murphy’s leadership, New Jersey is on the forefront of creating a stronger and fairer cannabis market. Especially for communities historically harmed by the unjust War on Drugs,” said NJEDA Chief Executive Officer Tim Sullivan. “The Seed Equity Grant, which is specifically designed for social equity applicants, will help create an equitable, inclusive marketplace that will create jobs and strengthen communities. All while ensuring our entrepreneurs are able to reap the industry’s economic benefits and have access to the resources needed to succeed.”
In addition to the $150,000 in funding, Phase II includes an 8-week technical assistance program for grant recipients. The technical assistance program will provide training on converting a conditional license to an annual license needed to open. It will help business owners learn to build a team, manage financials, secure investors, and manage the supply chain.
“This next phase intentionally targets funding to those communities historically excluded from these opportunities,” said NJEDA Chief Community Development Officer Tai Cooper.
NJ Cannabis Equity Grant Program Details
Qualified applicants must have launched their business after March 9th, 2020, since the State is using COVID-19 pandemic recovery money.
Applicants must meet the NJ-CRC criteria for social equity and have obtained a conditional license.
Unlike the Phase I Joint Ventures Grant, applicants do not need to have secured real estate or municipal approval.
Those are the other significant problems hindering humble New Jersey cannabis entrepreneurs seeking to open a business.
A free eligibility assessment tool is available online for those looking to verify if they meet the requirements.
Many more New Jersey cannabis entrepreneurs need the money than is available. The NJEDA has discussed rolling a larger loan program out after these initial rounds.
