adult-use cannabis license

The New Jersey Cannabis Regulatory Commission (CRC) released a webinar detailing the upcoming application process for an adult-use cannabis license.

Commissioner Maria Del Cid said that they seek to “ensure a safe and equitable industry in our state.”

She said they want the application process to be “as smooth as possible for prospective applicants.”

The date to start applying for cultivation, manufacturing, and testing labs licenses is December 15th at 9 AM. Dispensary applicants can start applying on March 15th at 9 AM.

Licenses for the other classes of cannabis business licenses will be issued at a later date.

“We do expect to receive a high number of applications once applications open up on December 15th,” NJ CRC Executive Director Jeff Brown said.

He noted they have 90 days to review applications but can extend the deadline.

“It is very likely that the Commission will need to extend in the early days due to volume. Our goal is to get to that 90-day turnaround. But I do expect, given the volume we expect to receive, um, that at least initially we’re going to be looking at more than 90 days for review,” Brown said.

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The CRC has been understaffed since its creation this spring, which has caused delays.

Defining the 37 Cultivators

The Cultivation Cap was the other significant issue Brown discussed.

“We’ve received a lot of questions about our application review process and the statutory cap on, um, cultivators for the first two years,” Brown said.

Competition for cultivation licenses will be the fiercest. It is the only license class that is capped at 37 large-scale cultivation sources. Cultivation micro licenses are not included.

Brown noted several times the adult-use cannabis license cap ends in 13 months in February 2023 and does not apply to micro licenses. He described a system where several applicants could count as the first 37.

Initially, cannabis policy experts thought all the original 12 cannabis license holders, known as Alternative Treatment Centers (ATCs) would count as part of the 37. However, Breakwater in Cranbury and Harmony in Secaucus cannot convert their primary locations because those towns do not allow adult-use consumption. They also don’t have satellite locations open yet.

Brown noted that ATCs cannot yet submit certificates they have enough cannabis to be allowed to sell to the adult-use market. The NJ Cannabis Trade Association (NJCTA), which represents the opened license holders, insists they have produced enough cannabis to be certified. Many cannabis policy experts are skeptical.

The four vertical 2019 winners plus the five cultivation licenses previously awarded were initially thought to be guaranteed a spot. Plus, the six winners from the 2018 license issue where they sued the NJ Department of Health could receive licenses as well. That means there would only be ten standard licenses left that could be won. However, that is likely not the case.

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The 2019 winners likely will not count. At the meeting where their licenses were awarded, Brown said they want the winners to participate in the medical cannabis market for a year before they are allowed to sell to the adult-use cannabis market.

That would mean there are 26 large-scale cultivation licenses to be won.

Conditional licenses, which will receive priority review, need to be approved for conversion to an annual license once they receive site control and town approval before they could count as one of the 37. Thus, while they can receive an initial approval quickly, final approval is necessary and takes longer.

Conditional licenses have five and a half months once being approved to secure site control and municipal approval. Once they do, they must notify the CRC so that they can be approved as what’s known as an “annual” license to operate.

Adult-use Cannabis License Application Details

Brown explained the process whereby all applications must be submitted digitally.

“This is not a Request for Applications in the traditional sense. There’s not going to be a pool of applicants to be judged as a single group. The Commission is going to accept applications on a rolling basis,” he said.

He explained there will be a dashboard on the site to check the status of an application.

“I know in the past, ya know, a frustration among applicants is that they can’t go somewhere to just see the status of their application. Well, with this new application system, license applicants will be able to do just that,” Brown said.

He noted there were errors on the point totals for an annual adult-use cannabis license application approval.

“The annual has been updated already. The conversion is being updated. The scoring categories were correct,” he said. “It’s just that the totals were incorrect.”

Brown described the thorough information required for an application on the owner’s details, the company, and their application materials, including agreements. Documentation to prove one qualifies as a Society Equity or Diversely Owned must be provided.

Brown said they will examine applications closely for their ability to comply with regulations. They’re especially interested in the contracts the company has signed.

“We want to see what’s your overall plan. What are you going to establish in your business to ensure you’re constantly operating in compliance with our regulations,” he said. “We want to know that the business if issued a license, will be effective in compliance with our regulations.”

He noted the list of Impact Zones, which defines who can apply for an Impact Zone license, was released last week. He did not comment on how the list was devised.

Personal history and entity disclosure forms are forthcoming from the CRC for applicants to fill out.

“We will request information based on what we see in the application,” Brown said. “We want to make sure it’s a smooth process for all those involved.”

The start of the application process was supposed to start 30 days after the adoption of the interim regulations on August 19th, 2021.

The next meeting of the CRC is next Tuesday, December 7th, Pearl Harbor Day.

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