August 2023 Regional News Update: NYC Faces Licensing Challenges as NJ Market Expands

Two people, one a dispensary employee and one a customer, evaluate jars of cannabis flower at the checkout counter. A tablet with checkout options is displayed on the screen.

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August was not a slow news month for East Coast cannabis! From the inaugural cannabis farmers market in NYC to delivery preparation in NJ to serious challenges posed to New York licenses, the market is on the move in more ways than one. Join us as we navigate the currents of change and delve into some of this month’s defining moments. 

1. Temporary order bars new N.Y. cannabis licenses under CAURD program

A New York judge issued a halt on cannabis licensing in regards to a lawsuit challenging the state’s current cannabis retailers program. The temporary order, signed by state Supreme Court Judge Kevin Bryant, bars regulators from issuing or processing new licenses until the matter is resolved. 

The Marihuana Regulation and Taxation Act (MRTA) passed in 2021 established service-disabled veterans as a sub-group of social and economic equity applicants who are being prioritized for licenses in New York State. However, a lawsuit filed by four veterans claims the Office of Cannabis Management (OCM) and Cannabis Control Board (CCB) unconstitutionally made cannabis-related convictions an initial eligibility requirement, pushing them out in the process. 

“The regulations that were then adopted, well not necessarily prohibiting any disabled service veteran from applying, they would have to then satisfy the other various CAURD (Conditional Adult-Use Retail Dispensary) requirements, which is that they were convicted of a marijuana-related offense prior to March 31st of 2021,” Matt Morey, a legal analyst, told Spectrum Local News.

Bryant’s ruling sided with the veterans, saying regulators veered from MRTA’s language. While there is no information regarding when the ban on licensing will be lifted, he ordered regulators to finalize their regulations promptly. In the meantime, many CAURD applicants are left in a holding pattern, uncertain about the future of their businesses.

2. Cannabis farmers markets launch throughout New York State

New York’s first cannabis farmers markets opened this month at multiple locations throughout the state. The CCB opened applications for the innovative Cannabis Growers Showcase (CGS) program last month as a way to expand opportunities for companies to sell their cannabis within the growing NY cannabis scene. The program offers a unique platform for licensed cultivators and processors to showcase their products.

One such grower’s market, location in New Paltz’s municipal parking lot, will be open from 4 p.m. to 8 p.m. on Thursdays and Fridays and 1 p.m. to 8 p.m. on Saturdays. This schedule will continue weekly until the end of 2023 or until a dispensary opens in the village. Visit the OCM’s website to find a full list of grower’s showcases throughout the state.

To receive approval for the CGS, applicants must have at least three licensed adult-use cannabis cultivators and one conditional retail licensee. For every three additional cultivators, another provisional vendor must be included at the event. Applications to participate will remain open until December 1st, 2023. 

3. Cannabis delivery licenses to open soon in New Jersey 

The New Jersey Cannabis Regulatory Commission (CRC) is set to open license applications for cannabis delivery in the state next month, on Sept. 27. According to the state’s website, license applications will be accepted and reviewed on a rolling basis until indicated otherwise. Social Equity Businesses, Diversely-Owned Businesses, Impact Zone Businesses, and applications that receive bonus points in relevant categories will be afforded priority review, scoring, and approval.

Recreational cannabis businesses may use the opening of these licenses as an opportunity to integrate vertically. This strategy allows operators to hold any combination of a cultivator license, a manufacturer license, a retailer license, and a delivery service license simultaneously or hold a wholesale and a distributor license simultaneously. All recreational license holders can have only one business in each class. 

4. New Jersey approves 41 retail licenses

In a special meeting held August 18th, the New Jersey Cannabis Regulatory Commission (NJCRC) approved 41 additional licenses for retail locations throughout the state. Many of the approvals were for conditional conversion applications, which are dispensaries that have already received their conditional license and are awaiting permission for their final license. Several annual licenses were also approved during the meeting.

5. NJ Contributes $5 Million of Cannabis Revenue to Violence Prevention Programs

New Jersey Gov. Phil Murphy (D) and Attorney General Matthew J. Platkin recently announced that revenue from the state’s legal cannabis program will cover a third of the cost of Community-Based Violence Intervention (CBVI) programs in the state. These programs are aimed at violence intervention and prevention in New Jersey and use various strategies such as mentoring programs, street outreach, and trauma support services in communities and among populations associated with risk factors for exposure to violence.

Of the $15 million in grant money that will be available through the program, $5 million comes from the state’s Cannabis Regulatory, Enforcement Assistance, and Marketplace Modernization Fund. 

According to a press release, this is just one portion of the $40 million that Gov. Murphy has directed to help facilitate CVBI Programs since 2021. The fund, which was established through the state’s cannabis legalization law, consists of monies from taxes on legal cannabis sales, industry fees, and civil penalties.  

“For far too long, pockets of our state have been scarred by violence. And, since day one of our Administration, we have been committed to solving this problem,” Murphy said in a press statement. “Through initiatives such as the [CBVI] Programs, we have made great strides on that pledge. I am incredibly grateful for Attorney General Platkin and his team’s steadfast dedication to reducing violence in our state and creating a safer community for all.”

Navigating change with CWCBExpo

These shifts in the cannabis landscape showcase the industry’s dynamic nature on the East Coast and beyond. As regulations continue to evolve, it’s crucial to stay in the loop with trusted and reliable sources. With CWCBExpo’s monthly news updates and in-person conferences, you can stay in the loop with real-time insights into the ever-evolving world of cannabis. 

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