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New Jersey Marijuana Sales Delay Isn’t Unusual Among Legalized States, Analysis Shows

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“I think this commission is doing remarkably well despite the setback last week, which I think a lot of people are frustrated by.”

By Nikita Biryukov, New Jersey Monitor

The delayed start to recreational marijuana sales has spurred calls for inquiries from one of the state’s most powerful lawmakers, but the nearly 17 months that have passed since New Jersey voters approved adult-use cannabis don’t make New Jersey an outlier among states with legal weed.

Eighteen states and the District of Columbia have legalized recreational marijuana through referendums or legislation, and it took on average 16-and-a-half months to set up legal markets in the 12 states where sales have started. The median is slightly lower, at 14 months.

Only four states—Washington, Massachusetts, Alaska and Maine—took longer to open their legal markets than New Jersey has taken.

Still, Senate President Nicholas Scutari (D-Union), who championed marijuana legalization before ascending the ranks of Senate leadership, on Tuesday announced the launch of a special legislative committee to investigate why the launch of New Jersey’s market is behind schedule.

“These delays are totally unacceptable,” he said in a statement. “We need to get the legal marijuana market up and running in New Jersey. This has become a failure to follow through on the public mandate and to meet the expectations for new businesses and consumers.”

Once it convenes, that panel will take testimony from commission officials and would-be cannabis operators.

Gov. Phil Murphy (D) in February said recreational sales were just weeks away, and he said the same last week after the New Jersey Cannabis Regulatory Commission rejected recreational sales applications filed by eight medical dispensaries over concerns of a supply shortage.

Those application denials came after the commission missed its self-imposed February 22 deadline to stand up a legal market. The commission did approve conditional licenses for 68 cultivators, manufacturers and labs at last week’s meeting, and scheduled a special meeting for April 11.

The cannabis commission could face trouble from the Assembly, too. Cecilia Williams, a spokeswoman for Assembly Speaker Craig Coughlin (D-Middlesex), said the lower chamber leader shares Scutari’s concerns and did not close the door on the prospect of a joint committee.

“The speaker has met with commissioners and high-level staff at the Cannabis Regulatory Commission as well as industry leaders to voice his frustrations,” Williams said. “He expects to see significant progress made so that businesses can begin opening their doors and has not ruled out joining the Senate in oversight hearings if clarity is not achieved at the commission’s next meeting on April 11.”

Most of the states that have taken longer than New Jersey to implement their legal markets were hampered by delays, and the states that launched sales quickly faced shortages and ceded much of their markets to multistate operators. Murphy and New Jersey’s regulators have said they want to avoid out-of-state operators taking over the market here.

A Murphy spokesperson deferred comment to the commission. Its executive director, Jeff Brown, noted the commission is working to prepare medical marijuana dispensaries—alternative treatment centers (ATCs)—to expand and sell recreational cannabis while the adult-use market remains in limbo.

“The goal is to help ATCs meet the criteria that ensures the needs of medicinal patients are met, and to ensure across all providers that there is not a strain on supply, that municipal compliance is satisfied, and that the market can open safely, and so that equity is prioritized,” Brown said.

New Jersey’s regulators have worried about equity in the state’s cannabis sector. Enabling legislation—signed into law by Murphy in February 2021—requires the state set aside 30 percent of recreational marijuana licenses for women, disabled veterans, and people of color. Rules adopted by the commission also seek to ensure small operators—and not multi-state corporations—get a foothold in the state’s legal market.

Advocates don’t appear to share Scutari’s consternation over the delays, acknowledging that New Jersey’s stricter licensing rules mean the commission has less latitude than similar bodies in other states.

“Given what this commission has been charged to do, particularly as it relates to social equity and maintaining patient access and the short amount of time that they’ve had to be in existence and form and develop this effort, I think this commission is doing remarkably well despite the setback last week, which I think a lot of people are frustrated by,” said Bill Caruso, a lobbyist and longtime supporter of marijuana legalization.

What happened in other states

In Massachusetts, a dearth of testing lab applications forced the state to delay legal marijuana sales by four months. It took the state two years to begin recreational sales after voters approved a legalization referendum.

After Maine voters approved legalization, regulatory changes and opposition from then-Gov. Paul LePage (R) made the Pine Tree State’s legal market take longer to erect than any other in the country. The state’s legal market didn’t open until four years after voters gave the green light.

Washington, which was among the first states to legalize recreational marijuana use, also had to push back the launch of its legal market after denying licenses for cannabis growers and processors. Twenty months passed between voters approving legalization and sales beginning in the Evergreen State.

Arizona, which stood up its legal market just two months after voters approved recreational sales at the polls in November 2020, allowed medical marijuana dispensaries to begin adult-use sales almost immediately, effectively leaving the market to a small number of corporate operators.

Arizona opened social equity dispensary applications last June but isn’t expected to approve applicants until later this year. The state saw some marijuana shortages shortly after greenlighting recreational sales.

Illinois, which at seven months was the second fastest state to begin recreational sales, also saw corporations win large swaths of the marijuana market share. Shortages were more severe in the Land of Lincoln because the state approved fewer licenses for marijuana growers that were greenlit elsewhere.

New Jersey’s regulators have sought to prevent the legal market from straining the state’s medical marijuana supply. They said last week the state is short about 100,000 pounds of marijuana to meet demand in both sectors.

This story was first published by New Jersey Monitor.

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