Controversy Surrounds Bill That Would Regulate Cannabis Industry • New Jersey Monitor

New Jersey’s cannabis market could see big changes under a bill on Gov. Phil Murphy’s desk that would require the state’s cannabis agency to regulate intoxicating cannabis products like delta-8 and CBD.

The bill was intended to address complaints that children have too much access to cannabis products, but some cannabis advocates say the legislation, while well-intentioned, includes provisions they say could weaken the state’s cannabis industry, such as allowing liquor stores to sell cannabis products.

Marijuana advocate Leo Bridgewater called the bill a “shit show.”

It was one of several bills that lawmakers introduced and gave final approval last week, finalizing a $56.6 billion budget.

Congress legalized hemp production in 2018, but there has been little regulation, testing or legislation, meaning products advertised as containing thousands of milligrams of THC — the compound that gets users high — can be sold on grocery store or gas station shelves, often in packaging that critics say encourages children to buy them.

The measure on Murphy’s desk would place intoxicating hemp products — a finished product with no more than 0.3% total THC derived from hemp — under the supervision of the Cannabis Regulatory Commission. Intoxicating hemp products include delta-8 and delta-9, CBD and other cannabinoids and have significantly less THC than hemp products.

Critics say the bill amounts to a de facto ban on cannabis products because it requires anyone selling them to obtain a license from a state marijuana regulator. It would create rules and regulations on how cannabis should be packaged, whether it should be subject to fees and how the licensing process would work.

Attorney Beau Huch, who represents cannabis beverage companies, said the bill doesn’t allow cannabis products to be sold again until cannabis officials implement the new regulations. Huch said he supports the regulations but noted that the cannabis commission has waited a long time to approve the opening of the first dispensaries in the state, and licensees still face long waits, even for minor things like changing a company’s name.

“I’m definitely in favor of regulation, but who is the regulator? What’s the timeline? And what information is sufficient to give to the state at the very beginning to keep products on the shelves so it’s not a de facto ban?” he said.

The bill would also only allow the sale of hemp products grown, raised and manufactured in the state, which Huch said could violate the commerce clause of the U.S. Constitution. He said the high cost of land in New Jersey could lead to less production of hemp goods.

The bill would also allow licensees to sell alcoholic beverages to sell cannabis products if they apply for a license with the Cannabis Regulatory Commission. Critics of the move say it would give the liquor store industry a backdoor into the cannabis industry, which many applicants have had trouble breaking into due to myriad state regulations and city restrictions.

Kevin Hagan, a lobbyist for the New Jersey Liquor Store Alliance, said liquor stores are already trying to protect minors from alcohol and could do the same with cannabis.

“The system is up and running and ready,” Hagan said.

Under the bill, the Cannabis Regulatory Commission, along with the Division of Alcoholic Beverage Control, would have 12 months to adopt regulations regarding packaging, labeling, product testing and safety standards, THC levels, a limit on the number of cannabis beverages that can be purchased at one time, and a fee to cover administrative costs.

Bridgewater said he’s concerned the cannabis industry won’t have the same social equity requirements as the marijuana industry, even though retailers in both sectors will sell similar products. He also noted that lawmakers have taken steps to regulate cannabis, even though they haven’t yet passed a bill that would allow people to grow their own marijuana.

Bridgewater said lawmakers “don’t know what they’re getting into.”

“We’re asking the Flintstones to write the rules for the Jetsons game,” he said.

There is also some confusion about the bill’s technical aspects and unanswered questions from cannabis industry advocates who want to see it grow. Some wonder what will happen to existing retailers who sell cannabis in cities that have banned cannabis dispensaries, and whether the cannabis commission will impose a tax on cannabis.

“This bill is not perfect, but it does what it’s supposed to do to stop unregulated, untaxed, untested products from coming to market and being sold to minors,” said marijuana attorney Bill Caruso. “I think there’s a long regulatory process to figure out some of the details, and there’s always the possibility that the legislature will have to go back and either add, clarify, or subtract to fix it.”

A spokeswoman for the Marijuana Regulatory Commission declined to comment on the bill.