New Jersey lawmakers are considering a measure that would allow medical dispensaries to start selling adult-use cannabis without local approval.
Under a bill introduced Jan. 30 by Senate President Nicholas Scutari, D-22nd District, the New Jersey Cannabis Regulatory Commission would no longer require medical-only dispensaries to undergo municipal review as a condition for conversion.
Ahead of the April 2022 launch of legalized adult-use sales, municipalities were given a choice to opt in – or out – of permitting cannabusinesses within their communities. Currently, only about a third of New Jersey’s 564 towns allow some form of cannabis sales, whether recreational or medical.
State law also grants towns the ability to impose separate licensing or endorsement requirements when it comes to the number of legalized businesses, locations or times of operation.
In New Jersey, the majority of the state’s 200-plus dispensaries offer both adult-use and medical. However, there are five stores that only sell to patients enrolled in a medical cannabis program.
According to the newly introduced bill, towns would not be able to prohibit medical dispensaries from offering adult-use – just as long as the business has been operating without any violations for at least six months. While municipal officials would still be able to limit the number of recreational storefronts within their borders, the legislation prohibits them from capping how many medical dispensaries are in town.
Paramus is among the municipalities in New Jersey that only allows medical marijuana sales. If the bill advances, MSO Green Thumb Industries-owned Rise would be able to start offering adult-use products at its 4-year-old storefront on Route 4.
Paramus Mayor Christopher DiPiazza – a Republican who was elected mayor in November 2022 after serving as a borough councilman – believes the legislation sets a dangerous precedent.
“The idea that Trenton and state legislators can come in and overrule zoning ordinances and municipal dos or do nots in town, it is scary for the whole state. The governing body in Paramus is elected by Paramus residents. The planning boards and the zoning boards are appointed by that elected government. And we have all decided that recreational use is not permitted in Paramus, and we have been rewarded at the ballot box because of that. And for people in Trenton that do not represent Paramus, to do that is not democratic and it’s a slap in the face,” he said, adding, “It’s insulting. And it should worry all 564 mayors in the state.”
“Putting aside the issue of marijuana – and I’m indifferent on the pros and cons of marijuana usage – if the bill is passed, we’ll fight it for those basic reasons. It goes against our legal zoning laws … not because we’re not in favor of opening recreational marijuana, but I think the key is that what’s next?”
‘Much ado about nothing’
Joshua Bauchner, a partner and chair of Roseland-headquartered Mandelbaum Barrett PC’s cannabis & psychedelics practice group, believes it’s “much ado about nothing.”
“Is it really all that critical to the state as a whole or to those five townships that they are not going to have to undertake a process to prove these licensees who’ve already ostensibly been operating lawfully in compliance with all the rules and regs under the more stringent medical guidelines somehow should now not be permitted to operate under the adult use guidelines?” he said.
Bauchner went on to say, “This is not telling them they have to permit a cannabis operator within their boundaries. It’s telling them if they already have one in their boundaries, that in addition to selling medical it’s going to sell adult use. And let’s also not forget that the medical program is on the demise … because people don’t want to go through the process of having to get a medical card when you could just go and buy adult use. The product is the same. The only difference really is taxes.”
“There might be a little backlash [by municipalities] because they may feel like they’re having their authority limited by the state, but I think it’ll be fleeting,” he said. “Conversely, those townships might say ‘great, more tax revenue’ because sales are going to increase when you add adult use.”
Delays in the municipal approval process and issues with real estate are among the biggest reasons why conditional license holders request application extensions, the CRC has said. After that, funding has been cited as the main cause, according to the agency.
In an effort to reduce delays, the legislation also seeks to enact stricter deadlines for the CRC to decide on applicants for all six license classes as well as streamline the overall process.
Right now, the state has 30 days to act on first-time applications and 90 days for renewals – with possible extensions. Under Senate Bill 4074, the CRC would be required to decide within 30 days after requesting extra time, which would essentially cap reviews at 60 or 120 days.
Did you know?
Currently, only about a third of New Jersey’s 564 towns allow some form of cannabis sales, whether recreational or medical.
Other provisions within the bill include: eliminating the need for applicants to submit business plans, management profiles or liability insurance information; and removing special consideration for applicants partnering with educational institutions to create an integrated curriculum involving the cultivation, manufacturing, wholesaling, distributing, retail sales, or delivery of personal use cannabis or cannabis items;
It would also bar the CRC from denying licenses to relatives of current license holders – however spouses would remain ineligible.
Additionally, the measure would require the CRC to create an online public portal to keep track of all cannabis-related ordinances and regulations passed by municipalities in the state.
Scutari is the only sponsor of the bill. It has since been referred to the senate judiciary committee.
Companion legislation had not been introduced into the state Assembly as of the end of February.
The CRC said it does not comment on pending legislation.
‘Taking too long’
Bauchner believes expediting the process will help further the goal of establishing a safely regulated industry and curtailing the black market.
“A big portion of the proposed bill is to prevent the CRC from giving itself extensions to deliberate on applications,” he said. “I think there’s a lot of frustration in the Legislature that this is just taking too long.”
John Fanburg, co-chair of Roseland-based Brach Eichler LLC’s cannabis industry practice, said he regards the legislation as a positive for the industry because it’ll make the application and review process much smoother for both business owners and the CRC. He did note that while municipalities may “not like being told what they can and can’t do,” the proposed changes in the bill will be a positive direction for the industry.
“It will provide more flexibility and allow for more businesses to obtain licensure. This is good,” he said. “While the bill is missing the ability to allow home grow, it is productive that the bill seems to be trying to streamline the application and determination process.”
Since New Jersey’s adult-use market opened nearly three years ago, participation in the state’s Medicinal Cannabis Program continues to decline.
As of February 2025, there were 65,433 participants, down from 128,548 in April 2022. As a result, dispensaries licensed to sell medical products are generating less revenue. Between July 2024 and September 2024, the market recorded $19.6 million in sales, down from $22.7 million in the prior quarter.
Meanwhile, the legalized market for recreational cannabis posted $277.5 million in sales for the period of July 2024 to September 2024. That’s up from $270 million in the previous quarter.
Overall, the legalized market recorded more than $1 billion in medical and recreational cannabis sales last year – a nearly 25% increase from 2023’s total of $800.3 million.
“With the decrease in interest in medical cannabis and decrease in registrations, these dispensaries are suffering,” Bauchner said. “There’s a process for converting built into the law and I think the intention was always that they were going to convert.”
H/T: njbiz.com
