The slow, frustrating slog to launch new NJ marijuana businesses

TRENTON – State regulators say they’re moving as fast as they can to approve licenses for businesses seeking to sell legal recreational marijuana. bBut some applicants are frustrated by the pace and head start being enjoyed by corporations that have expanded their medical cannabis businesses.

To date, 308 conditional licenses for new recreational marijuana businesses have been granted: 130 cultivators, 68 manufacturers and 110 retailers. That’s around one-third of the total who are seeking such licenses, with around 350 others waiting for initial priority reviews or final scoring and others told they need to cure shortcomings in their application.

Conditional licenses allow the companies to secure locations, municipal approvals and more – but not open their doors for business. For that, they will need to convert to an annual license, a more complicated approval process that involves a deeper dive into a company’s finances and an on-site inspection.

Nearly 1,200 marijuana license applications in NJ

Companies can skip the conditional licensing and apply directly for annual licenses, and around 240 have done that. But they are stuck in a holding pattern, as the Cannabis Regulatory Commission prioritizes the conditional licenses first and is still working through those.

CRC Executive Director Jeff Brown said that eventually conditional licenses will be reviewed within 90 days, with annuals and conditional-to-annual conversions taking a bit longer, but that’s not possible yet with 1,182 license applications since December.

“We knew that we would receive a ton of applications at first, and we’re devoting the resources needed to get through that initial rush,” Brown said.

Applications for cultivating and manufacturing licenses began to be accepted in December. Applications for retailer licenses began to be accepted in March.

'You are failing miserably'

Scott Bent, who is seeking a conditional license for the Euphorium Dispensary, says the CRC needs to speed up because corporate dispensaries have an advantage.

“Get your focus back on track because you are failing miserably,” Bent told the commission at its meeting Thursday. “There is not one approved annual application. There is a bunch of people with a lot of questions. But there are doors wide open for the existing millionaires to make more millions.”

Brennan McGrath said that continuing the conditionals-first approach is hurting businesses. He said businesses seeking annual licenses are already making payments on properties they can’t open while multi-state dispensaries expand and further dominate.

“Why not show support for New Jersey small business owners and start awarding annual licenses to those who have put in a tremendous amount of time, effort and money to meet all of your requirements?” McGrath said.

A couple of months to go

Brown said the pivot to annual licenses is coming soon.

“I am confident that we will make our way through the remaining 284 over the next month or so, next couple months,” Brown said, referring to the number awaiting their completeness check and final scoring.

Osbert Orduña, chief executive officer of The Cannabis Place, said he understands the state was swamped but that to speed things up, the CRC should meet sooner than September to approve the recommendations of the staff.

“This will greatly assist all applicants, especially social equity and diversely held license applicants, who are currently paying costs for real estate, holding costs, interest on borrowed funds and additional expenses that small businesses do not have the luxury of affording on a long-term basis,” Orduña said.

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The CRC wasn’t due to meet again until Sept. 22 but at Vice Chairman Sam Delgado’s urging voted to move that up by two weeks, to the week after Labor Day.

“These applicants and businesses have consultants. They have legal and lease payments to make,” Delgado said. “To some, a delay may make or even break them financially or be extremely expensive, costly.”

Michael Symons is the Statehouse bureau chief for New Jersey 101.5. You can reach him at michael.symons@townsquaremedia.com

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