Senior manager, Cannabis Practice co-team leader
The sale of cannabis for recreational use finally is here. Did the long delay help the state or hurt the state when it comes to establishing itself in the business of cannabis?
“Yes, it’s frustrating that it took longer than anticipated and, yes, it may have hurt applicants short term, but the delay is going to help the industry long term. States that previously rushed to open markets were met with unintended consequences, often wreaking havoc and taking years to correct. With the rounds of public comment and due diligence comparing mature markets, the Cannabis Regulatory Commission is clearly prioritizing long-term success.”
For those just getting interested in getting into the cannabis business space, whether it be growing, distributing or selling, is it too late? What would you advise someone who is looking into a venture today?
“Applicants pioneering the state’s process first undoubtedly have the opportunity to be first to market. But, by no means will this be a golden ticket. Alternatively, it will not create a significant barrier to those looking to jump into the market at a later time. In mature market states, some of our most successful clients are those that entered the industry years after the first recreational sale. Also, a caution to those first to market is the state’s legal tax framework includes a 33% excise fee on the average retail price per ounce for the first nine months of legal sales.”
Do you think the regulations will create an equitable market, one where underserved communities have a fair chance to succeed, as Gov. Phil Murphy has wanted from the beginning? If not, what rules/regulations would you add to meet this ideal?
“In mature market states, the social equity provisions had not been crafted as carefully as in New Jersey’s regulations. This creates an abundance of optimism that New Jersey will have an equitable market. Microbusiness license minimums at every stop of the industry’s vertical is just one of the key provisions that will help build and sustain an equitable cannabis industry. However, I would like to see the state address social equity funding opportunities head-on, similar to New York’s framework, which includes a $200 million revolving fund for social and economic equity applicants to access.”
Give us one more thought on the cannabis industry in New Jersey?
“It’s a very exciting time to be an entrepreneur with a passion for cannabis. The state is filled with people eager to learn and offer their experiences. There is an incredible humility and sense of community in this industry right now, and I expect that will continue for years to come.”