New Jersey Legal Marijuana Legislation Stalls, And Lawmakers Punt It To The Summer

Photo Credit: Chris Roussakis

Don’t hold your breath for movement on legislation to legalize marijuana in New Jersey before Saturday’s state budget deadline.

State legislators and industry insiders say it’s going to be kicked down the road until after the state gets a budget.
State Sen. Nicholas Scutari, D-Union, who proposed his recreational/medicinal marijuana mashup just three weeks ago, told NJ Advance Media there’ll be no push to get legislation done this week but he believes it could be hashed out over the next month.

Scutari also announced this and other points about legalization and expansion plans to industry operators, lobbyists and social justice advocates at a meeting on Friday at Galloping Hills Country Club, according to a half-dozen people who attended the meeting.

Scutari said he wants both the medical and recreational legislation to move together, even though they’re separate bills, because they’re “the same product.”

Industry experts, however, say that while expansion of the medical program has a large base of support, recreational — or adult-use — marijuana is far more controversial and could hold back medical expansion efforts.

And with the steadily increasing number of patients who’ve been enrolling in the state medical program since Gov. Phil Murphy used his executive powers to expand the program in late March, there’s a growing concern about a supply crisis for patients.

Only six dispensaries are currently able to cultivate and sell medical cannabis in New Jersey for the 24,000 patients enrolled in the program, which has added about 5,000 patients since March 26.

State Sen. Joseph Vitale, D-Middlesex, the sponsor of the medicinal marijuana expansion bill and an opponent to legalizing weed for recreational use, said he believes expansion plans with respect to the medical program should be an administrative issue for the Department of Health.

“From my perspective it’s about patients first,” Vitale said. “It’s not about someone being able to maximize their profits or control the market. It’s about how patients are served in a way that makes sense.”

Among the sticking points in the current legislative proposals, insiders say, are issues of governance around a commission that would be set up to oversee the medical and adult-use market and about a new class of licenses for wholesalers. Other issues such as social equity and labeling were also discussed at the sit-down with Scutari.

Scutari told NJ Advance Media he wants to set up a “marijuana oversight commission” made up of members from the executive branch and Assembly and Senate appointees. Scutari and supporters of the commission say it would make the program “nimble” with respect to changes in the market.

“The administration should not be given sole discretion,” Scutari said.

However, several insiders say they have concerns about how the commission would actually work, as the current proposal would require unanimous votes to move expansion plans forward — meaning any member of the commission could effectively stall or scuttle any given vote. There’s also concerns about whether that proposed commission would be a non-starter with the administration.

On the new license class for wholesalers, several industry insiders say they believe this model was developed based on the liquor industry, which mandates alcohol producers sell to a wholesale distributor instead of directly to a retailer.

Critics of the license say it carves out a space for the liquor industry to operate in the cannabis space and provides another link in supply chain that could drive up costs for consumers.

Proponents say it could create a bar to large, “vertically integrated” companies from controlling the entire market. Vertical integration is an arrangement in which the supply chain of a company is owned by that company — such as the current medical marijuana dispensaries that cultivate cannabis and then sell it directly to patients.

Bill Caruso, Archer Public Affairs managing director and a member of the New Jersey United for Marijuana Reform steering committee, said he had an open mind that the wholesale license could provide another opportunity for operators in the cannabis business, but that it was also possible it could increase costs.

“It does potentially add cost to the consumer and it may add to the bureaucracy that’s being created in the supply chain,” Caruso said.

New Jersey Cannabis Industry Association president Hugh O’Beirne said the Garden State had been poised to enter the East Coast market before New York and Pennsylvania, but with the current stall “it looks like we’re snatching defeat from the jaws of victory.”

“We’re basically losing a tremendous opportunity for the industry in New Jersey and for the citizens of New Jersey by delaying or confusing it, and I don’t understand why,” O’Beirne said.

New Jersey CannaBusiness Association president Scott Rudder said he remained optimistic cannabis legislation would get done this summer.

“We’re trying to ensure cannabis gets a thoughtful hearing discussion that’s not rushed,” Rudder said.

Bill Pascrell III, a lobbyist with Princeton Public Affairs Group, said he believed there’s still an opportunity to move cannabis legalization within the next two to three months.

Calls placed to Murphy spokesman Dan Bryan haven’t yet been returned.