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In the face of simultaneous praise and criticism, New Jersey’s state cannabis regulators defended their protocols and procedures, highlighting their successes during a sometimes heated four-hour state Senate committee hearing Friday at the Statehouse.
Nearly a dozen senators from the bipartisan committee demonstrated at times they knew issues facing the nascent adult-use market. At other points, they seemed grossly under-informed, for instance, not knowing the difference between cannabis and menthol tobacco cigarettes. Some senators accused the Cannabis Regulatory Commission of acting too slowly. And then there were others who were critical about certain issues outside of the board’s control, according to the law legislators themselves passed in 2021.
State Sen. Troy Singleton, D-Burlington, accused the board about a lack of transparency over how tax money from cannabis sales was being used before being promptly told it was the Legislature and governor’s office that had the final say.
The CRC is capable of giving recommendations to the Legislature and the governor’s office, but it’s ultimately up to them what gets funded.
“The statute requires the Legislature then report back to the CRC which of the recommendations the Legislature is funding,” said CRC chairwoman Dianna Houenou.
Houenou and Jeff Brown, the commission’s executive director, were the first to speak, frequently called upon to answer questions throughout the informational Senate Judiciary Committee hearing.
While the beginning of the meeting started with more pointed criticism toward the commission — over application approval wait times, its recent tiff with the state’s biggest weed company and a dearth of outdoor growing facilities — the hearing had a more conciliatory tone after multiple people testified that the agency needed more resources.
Some industry insiders voiced concerns that the committee’s criticism and perceived lack of knowledge was a smokescreen to do the bidding of large companies that wanted to continue an oligopoly, which ultimately hurts small mom-and-pop shops, especially minorities or those hurt by the War on Drugs.
“I suspected much of what this hearing was about was to make the CRC a scapegoat for many of the things Legislature is actually in control over,” said Rev. Charles Boyer, director of Salvation and Social Justice, in an interview after the hearing. “I feel like there was a lot of energy in calling this hearing together to beat up on the CRC on behalf of big, white [owned] cannabis operators and that social equity was just the tagline to dress it up.”
Todd Johnson, director of the New Jersey Cannabis Trade Association, which represents medical operators including the state’s largest cannabis companies, charged that the CRC was a product of overregulation.
“For operators, delays and lack of communication are notorious,” he said.
Johnson, who is also a co-founder a cannabis company granted a conditional permit to operate, later said: “Capital flees where there is risk of uncertainty and loss.”
The argument runs a similar line to what state Sen. Vin Gopal, D-Monmouth, suggested earlier this year, when he floated the idea of dismantling the commission altogether.
Scott Rudder, founder of the New Jersey CannaBusiness Association, testified that the challenges operators encounter are multifaceted.
“Many of these challenges are of our own making,” said Rudder, who recently was approved to open a cannabis retail store in Riverside. “They are due in large part to the legislation and corresponding regulations that we collectively worked on and discussed.”
A point of contention came in the meeting when state Senate Judiciary Committee Chair Sen. Brian P. Stack, D-Hudson, and Sen. Bob Smith, D-Middlesex, asked about the CRC’s decision to not renew Curaleaf’s adult-use license to sale, reversing its decision days later.
“The board of commissioners is committed to making sure our industry has safe and responsible operators who follow the rules and follow the law,” Houenou said.
“The New Jersey industry is not a one company industry,” she said.
Smith and Singleton also pressured the commission on the Curaleaf renewal saga, painting a picture of an agency that made an erratic unforeseen decision.
The commission’s decision, however, was not a one-agency decision nor was its view of Curaleaf sudden. Multiple commissioners had criticized the company for months with concerns to collective bargaining provisions not being followed.
It was also advised by the state Attorney General’s Office’s Division of Law, which fell under criticism from some in the industry because Curaleaf hired a former New Jersey attorney general who used to work alongside the current one. The move was seen by critics as politically pressured decision, a charge that the state AG’s office has repeatedly denied.
AFL-CIO Legislative coordinator Eric Richard said Curaleaf had engaged in captive audience meetings.
“In our opinion, there was a clear act of union avoidance,” he said.
Curaleaf has repeatedly denied the accusations.
Sen. Joseph Lagana, D-Bergen, asked whether the commission wanted more enforcement powers against unlicensed cannabis sellers and gas stations that sold Delta-8, an unregulated cannabis product that’s legal due to loopholes in current federal law.
The Legislature recently passed a bill in one of their committees banning the sell of those products.
In a tense exchange, Singleton also pressed the commission on workplace drug impairment guidance.
“Would it be easier for the Legislature to tell you — You have six months to actually propose those or 12 months as opposed to this internal deliberative process,” he said.
“We know it’s a priority,” Brown said. “It is a concept that is new to New Jersey and its one that we want to get right.”
Singleton also asked the commission about the pace at which cultivators were being approved to which Brown commented that outdoor cultivation would help bring prices down weed and reduce the amount of time and capital cultivators spent on getting operational.
Singleton acknowledged that local municipal control played a large role in whether outdoor cannabis got approved.
Sen. Michael Testa, R-Cumberland, cited concerns with odor and outdoor cultivation being more susceptible to theft.
“We require outdoor grows to essentially have an exterior fence around the property and then also an interior fence,” Brown said.
New Jersey CannaBusiness Assn. counsel and longtime Trenton insider Bill Caruso, who also helped organize the hearing, said he felt more legislative hearings were helpful and that more understanding was needed.
“I think you’ve heard collectively we need more bodies, we need more people, they need more help,” he said of the commission to the Legislature.
“It’s going to take time, resources and your patience,” Caruso said.