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April 12, 2022

New Jersey's recreational marijuana sales could soon begin as state approves first retail licenses

About 70% of profits from all transactions will go towards communities adversely-impacted by cannabis-related arrests

Marijuana Sales
New Jersey recreational marijuana Matthew Brodeur/Unsplash

New Jersey's Cannabis Regulatory Commission approved applications Monday from seven alternative treatment centers to expand their operations into recreational adult-use marijuana over the next 30 days.

Recreational marijuana sales in New Jersey could begin within a month after regulators gave the green light to 13 existing dispensaries across the state.

The New Jersey Cannabis Regulatory Commission approved applications on Monday from seven medical marijuana companies to expand their operations into adult-use recreational weed. Formally known as alternative treatment centers, the group of businesses will be the first in the state to conduct retail sales of cannabis to adults ages 21 and older.

Three of the seven approved treatment centers – Curaleaf, Columbia Care and Acreage – are located in South Jersey. 

Curaleaf has a dispensary in Bellmawr, Camden County, as well as in Edgewater Park and Bordentown, Burlington County. Columbia Care has two locations in Deptford, Gloucester County and Vineland, Cumberland County. Acreage has three dispensaries in Williamstown, Camden County, Atlantic City and Egg Harbor Township, Atlantic County.

The other four approved businesses are located in the central and northern parts of the state.

Before recreational marijuana sales can begin, each approved facility must pay fees to the CRC, undergo a regulatory inspection of its operations and receive new licenses. 

Each approved facility also had to ensure that consumers seeking cannabis products for recreational use would not impede those from accessing marijuana for medical purposes. Each business is expected to provide medical marijuana patients with designated parking spaces and reserved hours.

"These approvals were given based on commitments from the ATCs that we would not see adverse effects with expansion," CRC Chair Dianna Houenou said. "Expansion into the adult-use market — with a substantial advantageous start ahead of new applicants — is a privilege that must not be taken lightly. We expect these ATCs to uphold their promises to patients and communities; and that recreational customers will be adequately served."

A specific date for when adult-use recreational marijuana sales will begin remains unclear. However, business could begin within the next month. The CRC said it will bypass a 30-day notification window for cannabis sales to start at each treatment center, meaning that business could officially open in about 30 days depending upon when inspections are completed and licenses are issued, reported.

The commission also approved 34 conditional license applications Monday for smaller cultivators and manufacturers to begin growing and building out their recreational marijuana operations, bringing the total number of approved conditional licenses up to 102. However, it could take up to a year for these entities to begin selling adult-use cannabis.

Close to 330 businesses have applied for recreational marijuana sales licenses in New Jersey so far, WHYY reported

The commission has estimated that there are about 800,000 potential recreational cannabis consumers in New Jersey, according to the Associated Press.

Gov. Phil Murphy signed three bills into law decriminalizing and legalizing adult-use recreational marijuana across New Jersey last February, making it the 13th state to legalize cannabis for recreational use. That number is now up to 18 states, including the District of Columbia, that have decriminalized and legalized the sale and use of recreational cannabis.

The legalization followed a lengthy back-and-forth in the state legislature for more than three months after roughly two-thirds of New Jersey residents voted in favor of the change on a ballot referendum in the 2020 election. The referendum succeeded after several legislative efforts failed over the past few years.

The law authorized adult-use cannabis sales by certain businesses licensed by the CRC, which is responsible for governing the industry in New Jersey.

The new marijuana legislation also gave municipalities 180 days to reinstate their bans of cannabis sales at the local level before falling under the jurisdiction of the state law. Some municipalities across the state have prohibited marijuana sales and cultivation in their towns, including Jersey Shore destinations like Ocean City, Wildwood Crest, Margate and Somers Point.

However, the kickoff of New Jersey's adult-use recreational marijuana market has been slow. The CRC missed a deadline in February to begin the roll out of the state's program. 

Among the biggest reasons for the delay was concern that the supply wouldn't meet the initial demand, state regulators said. The commission rejected applications from alternative treatment centers last month because New Jersey was about 100,000 pounds short of meeting the demand for both the recreational and medical marijuana markets.

Murphy said in February that the state wanted to ensure that those who need marijuana for medical purposes were able to continue to purchase it as such products became legally accessible for most adults. 

There are only 11 marijuana businesses in New Jersey, operating 23 dispensaries statewide, according to the state.

How much money the state will specifically make in tax revenue off of recreational marijuana sales is unknown. Murphy estimated in his fiscal year 2023 budget that the state's recreational cannabis market could generate about $19 million in tax revenue, more than two-thirds less than the $60 million revenue spike he projected from the industry three years ago.

A sales tax of more than 6.6% will apply to all purchases and municipalities can add up to 2% more. About 70% of the money earned from all sales will go towards communities adversely-impacted by marijuana-related arrests.

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