Comparing New York and New Jersey Cannabis Laws

This article was originally featured on the CB Advisors blog.

New York vs. New Jersey: A Guide to Recreational Cannabis in the Mid-Atlantic

In a span of five months, two of the largest cannabis markets in the eastern U.S. legalized adult-use. Highlight of this blog is comparing New York and New Jersey Cannabis Laws. New Jersey voters approved the expansion of its program to adults over age 21 in the November 2020 election, and New York followed when Gov. Andrew M. Cuomo signed legislation into law on March 31st, 2021.

But every state cannabis program has its own share of nuances and the same goes for the recreational policies in these two mid-Atlantic powerhouses. Despite their close proximity, there are differences in how the state government’s in New York and New Jersey are pursuing adult-use marijuana policy and its eventual roll-out.

When comparing New York and New Jersey programs, here are items stakeholders should consider before choosing their cannabis business locale.

New Adult-Use Licenses in New Jersey

The number of recreational marijuana business licenses available in New Jersey will be determined by the newly formed Cannabis Regulatory Commission, based on market demand, license types include:

Cannabis Cultivator (There will be no more than 37 Cultivation Licenses awarded for the initial 24 months.)
Cannabis Delivery Service
Cannabis Distributor
Cannabis Manufacturer
Cannabis Processor
Cannabis Retailer
Cannabis Wholesaler

New Adult-Use Licenses in New York

The number of recreational marijuana business licenses available in New York will be determined by a newly formed Office of Cannabis Management, based on market demand, license types include:

Adult-Use Cultivator
Adult-use Processor
Adult-use Retail Dispensary
Adult-use Distributor
Delivery
Nursery: This license shall authorize the production, sale and distribution of clones, immature plants, seeds, and other agricultural products used specifically for the planting, propagation, and cultivation of cannabis by licensed adult-use cultivators, cooperatives, microbusinesses or registered organizations.
Microbusiness: This license shall authorize the limited cultivation, processing, distribution, delivery, and dispensing of their own adult-use cannabis and cannabis products.
Adult-Use Consumption: A license that allows for the consumption of cannabis in an area, example a lounge or bar.
Adult-use Cooperative: This license shall authorize the acquisition, possession, cultivation, processing, distribution and sale of cannabis to licensed distributors, on-site consumption sites, registered organization and/or retail dispensaries; but not directly to cannabis consumers.

Local Municipality “Opt-Out” Deadlines

Cities, towns, and villages in New Jersey and New York have the ability to “opt-out” of hosting adult-use cannabis businesses within their borders; however, municipalities cannot exclude cannabis possession and use by adults 21 years of age or older. Stakeholders will want to play close attention to ensure the cannabis real estate they secure is compliant with local rules. The deadlines for municipalities to opt out are as follows:

New Jersey: August 21st, 2021.

New York: December 2021.

Social Equity and Diversity Programs

Both New York and New Jersey are implementing social equity components into their adult-use marijuana license processes. A social equity or diversity program helps ensure minority business owners and those who were adversely affected by the war on drugs have access to licensing opportunities in the cannabis space.

New Jersey: Requires 30 percent of the licenses must be allocated to businesses owned by women, minorities or disabled veterans. Additionally, at least 25 percent should be allocated to residents of impact zones. The bill includes the creation of an Office of Minority, Disabled Veterans, and Women Cannabis Business Development which will be part of the state;s Cannabis Regulatory Commission.

New York: Reserves 50 percent of the cannabis licenses for social equity applicants.

The social and economic equity plan ensures the inclusion of:

Individuals from communities disproportionately impacted by the enforcement of cannabis prohibition
Minority-owned businesses
Women-owned businesses
Minority and women-owned businesses
Distressed farmers
Service-disables veterans

How Can Sapphire Risk Help?

Tony Gallo and the team at Sapphire Risk Advisory Group are prepared to help with licensing and security procedures for cannabis businesses in New York and New Jersey. Follow us on social media to stay up to date with cannabis industry updates!

Authors

Sara Gullickson is the Founder and Chief Executive Officer of CB Advisors. Sara is an entrepreneur, investor, and corporate dealmaker with more than a decade of experience building and scaling businesses personally and professionally. A high-level strategist, Sara advises stakeholders on corporate structure, financing, and operations to better position their companies for growth and potential exit.

Maxime Kot is the President of CB Advisors. Maxime Kot is president and part owner of national consulting firm The Cannabis Business Advisors. A cannabis licensing and compliance expert with six years of direct industry experience, Kot has built a proven track record securing multiple cannabis licenses across 17 state markets.

If you’re interested in entering the New York or New Jersey recreational marijuana market, contact the CB Advisors team today to start developing your licensing plan and approach. New Jersey license applications are expected to open in Q4 2021 and New York in Q1 2022.