New Jersey Senate Committee Approves Cannabis Bill With Cultivation Caps

New Jersey lawmakers are racing to pass legislation that creates a framework for the state’s adult use industry. 

On Monday, the Senate Judiciary Committee met in-person in Trenton for a public hearing and to vote on S21, a bill to implement the public referendum to legalize adult-use cannabis that voters passed on Election Day. Ultimately, the committee voted 6-5, narrowly in favor of advancing the bill. A Senate floor vote on the amended bill is expected on Thursday, with the Assembly moving forward in tandem. 

Judiciary Committee Chair Nicholas Scutari, a longtime supporter of cannabis law reform, said he is “anticipating” what he calls “cleanup legislation” to further amend the bills, which he says are products of compromise, but still must be passed this week to avoid a “constitutional crisis.”

“If we don’t get this done, it’s the Wild West on January first,” Scutari said. 

The state’s Judiciary Committee heard testimony on a number of amendments to the legislation, which came after negotiations between the Senate and Assembly. (As Cannabis Wire reported, lawmakers reached a deal earlier this month.) The latest version contains a proposal to earmark 70% of cannabis sales tax revenue to programs aimed at supporting communities disproportionately harmed by the enforcement of cannabis laws, with the remaining 30% going toward public health and education efforts, and to law enforcement for items like Drug Recognition Expert training. All of the “Social Equity Excise Fees” on cultivators  would go toward “impact zones.” In addition, the amended bill contains the Assembly’s proposal to cap cultivators at 37 for the first 24 months, a topic that several speakers focused on during Monday’s hearing. 

Senate President Steve Sweeney, who voted in support of the bill, emphasized that the legislation is the beginning of the process of establishing New Jersey’s cannabis industry, and that regulators will continue to refine the program. 

“I don’t like the caps either, but we negotiated a bill,” Sweeney said. “We can never legislate everything here. That’s just a reality. And there’s no question we will be back in a year or two saying there was an unintended consequence. And we’ll fix that, because we want this industry to flourish.”

Scutari thanked Sweeney for his willingness to take a trip to Colorado to spend 24 hours meeting with regulators and state executives on cannabis. 

During Monday’s hearing, Scutari also talked about how difficult it was to pass a medical cannabis bill back in 2009, and how much the program withered under former Governor Chris Christie, who was far from friendly toward cannabis. 

“This is the next Herculean task,” Scutari said, referencing the adult use framework bill. “I think we’ve done a great job, spent a lot of time on this bill, and it’s not going to be perfect. But I think it’s pretty close. And if necessary, we’re going to make changes going forward to make sure that this industry can perform to the best of what we want it to be.” 

Jo Anne Zito, a founding board member of Coalition for Medical Marijuana – New Jersey, spoke about the license caps, and laid out the myriad issues that the state’s medical cannabis patients have experienced, from long wait times to expensive products. And, Zito said, “there’s still no delivery.” Zito also turned to home cultivation. Unlike many other medical and adult use states, New Jersey does not allow home cultivation for the former and is unlikely to allow it for the latter.  

“Because they are registered with the state,” Zito said, referencing patients, “they would not be hard to police. Just because there are some bad actors with home growing should not mean patients are denied this reasonable access.” 

Scutari responded by acknowledging that medical cannabis has “been a long, slow slog” to get “up to speed.” Now, Governor Phil Murphy’s administration is “much more interested in seeing this be successful,” he said, adding that “we need to ramp up the supply because there’s a greater demand. I understand that. All these bills are a compromise.” 

Tahir Johnson, from the National Cannabis Industry Association, who was born and raised in Trenton, New Jersey, spoke about two topics: license caps, which make it harder for equity applicants to enter the industry, and the need for more specificity on social equity applicants so they aren’t “competing with larger operators.” 

“As we look at creating a new industry that will bring billions of dollars to New Jersey, it’s important to make sure that people that are from the same communities, like here in Trenton, that have been harmed by the war on drugs, have an equal opportunity to participate and that they don’t have to compete against multimillion dollar corporations in order to have that opportunity,” Johnson said. 

Mary Pryor, CEO of Cannaclusive, agreed that the bill needs to be more specific on the issue of equity, and said that she foresees “a big issue” when municipalities start determining what constitutes “equity.” She pointed out that the current version of the bill has more than a dozen mentions of the word “equity,” but no clear definition.  

“I do think that the bill needs to have a definition of social equity so that you can avoid a lot of the pitfalls” in other states, Pryor said. 

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