Deadlines and compliance – nj.com – nj.com

We hope everyone enjoyed Juneteenth, while also remembering that the encapsulated struggle of the holiday is representative of work that still has to be done in today’s current conversation around equity.

Now — speaking of equity and economic justice. We are proud to announce a partnership in which we will be responsible for picking two social equity applicants for a $20,000 grant. So, everyone get their pens ready. More details are in the issue.

The electronic ink we’ve got on the page is packed with a variety of topics, but none more pressing than ordinances and the accompanying regulations that come with them.

They make or break the space.

With a bill recently introduced to extend that period, Sue Livio writes on how that extension can affect efforts going forward and result in more time for municipalities to figure out what they want the cannabis industry to look like.

Additionally, Sue also delivers another article on something that has been essential to those very ordinances — education, as she talks about other efforts underway to invest cannabis revenue into educational initiatives and institutions.

Also, once more: Sue, the clear GOAT and MVP reporter of the issue (an HTML server shall be christened in her name), has a detailed Q&A with Longview Strategic on what it takes to be a viable business in the cannabis industry.

Amanda Hoover came from a break this week and on her first day back, immediately got after it, to keep us apprised of the latest dispensary opening with a new Curaleaf location.

We’ve also got a special guest this week coming from our NJ.com colleague, Amy Z. Quinn, an audience editor who had an interesting conversation with one of the delivery businesses that received a cease and desist letter from the state AG.

Jonathan Salant chimes in from D.C. with an article on how the lack of economic and social justice provisions is a no-go for many in the Democratic Party when it comes to federal legalization.

As for me, I’ll be moderating a cannabis conference for the New Jersey Society of Certified Public Accountants (NJCPA), featuring many New Jersey power players on Aug. 5. As part of our collaboration, the NJCPA is offer our subscribers this code NJCICAN to participate at the same cost as society members. If you’re interested in attending, go here.

Whew. So much is going on in this issue I’m not even doing my usual philosophical musing in the intro.

But I do need to note, we added one last speaker to our summer speaker series, and I’ll warn you tickets are selling fast. Check out the details in the Event section.

Lastly, an early heads up: We won’t be publishing the week of the Independence Day holiday, July 8. We’ll be back July 15.

Until next week…

— Jelani Gibson

Will a deadline extension help towns make better decisions?

As officials from hundreds of communities in New Jersey stress over a looming August deadline to decide whether they will welcome or block future legal marijuana businesses, a state lawmaker wants to give them 60 more days of deliberation.

Assemblyman Christopher Tully, D-Bergen, introduced a bill Monday (A5921) that gives local elected officials an additional 60 days beyond the Aug. 21 deadline to enact an ordinance either welcoming or banning adult-use cannabis businesses from opening in their communities.

As it stands now under the law Gov. Phil Murphy signed in February, local officials who take no action by the deadline would have to abide by a standard set of rules for five years. The law was written this way in order to allow the potentially multi-billion-dollar industry more opportunities to succeed.

Edmund DeVeaux, president of the New Jersey CannaBusiness Association, endorsed the legislation. Absent state rules regulating the industry, which are also due on Aug. 21, local officials have been frustrated with having to make a decision minus key facts.

“The one thing that has been clear since February of this year has been the confusion over municipal guidelines in the emerging cannabis economy,” DeVeaux said.

“The NJCBA is in conversations with several communities as to how to best deal with the looming opt-in/opt-out deadline. Supporting the extension is one more way the NJCBA supports municipalities in ensuring the state develops a responsible, sustainable, diverse, and profitable cannabis industry,” DeVeaux said.

“Moreover, this provides additional support for the Cannabis Regulatory Commission, faced with the immense task of creating an agency and an industry,” he added.

Clinton Town Mayor Janice Kovach, who is also president of the New Jersey League of Municipalities, said she appreciated the Assemblyman understanding the need for more time.

“We didn’t ask for (the bill) but would be supportive of any extension that would give the towns the opportunity to continue to review,” Kovach said. “However, rather than a set timeframe, an extension pass the introduction of the rules would be ideal.”

Tully could not immediately be reached for comment.

The state Legislature would have to move fast if they wanted to enact the bill. Lawmakers would have until the end of June to hold hearings, vote on it and send it to Murphy for signature before the Legislature goes on recess until after the November general election.

Brick, Bridgewater and Sea Isle and are among the cities and towns that have banned cannabis sales. Officials from other communities have said they are opting to block cannabis businesses until the state Cannabis Regulatory Commission releases a proposed set of rules its members will use to regulate the new market. According to a survey NJ Cannabis Insider is conducting of the Garden State’s 300 most populous municipalities, some 120 have already passed ordinances or are leaning toward opting out.

New Jersey voters said yes to legalizing marijuana last November by a 2-to-1 margin, but legal sales to those over 21 cannot begin until the commission establishes rules and licenses new dispensaries and grow facilities. Those will all need local approval from the cities and towns where they set up shop.

— Susan K. Livio | NJ.com

Amanda Hoover contributed to this report.

Ellie Siegel and Jake Robbins

As entrepreneurs gear up to enter the cannabis marketplaces, state and local officials are developing a framework for regulating the industry. NJCI asked Ellie Siegel, CEO and founder Longview Strategic to describe how she is advising clients during this critical time.

Siegel and Jake Robbins, Longview Strategic’s manager of Client Services responded to our questions.

Q: Many people who are not backed up deep-pocketed investors want to get into the cannabis industry. What do people who are not millionaires need to get a foot in the door?

A: We like to say that getting your foot in the door is about making sure you’re wearing the right shoes.

We’re living through the end of prohibition and watching the generation of an extraordinary amount of wealth as the (already massive) cannabis market is properly counted, taxed, and fit into the systems of corporate capitalism. The downside to this change is that all of the normal economic and systemic pressures of starting a new business are compounded by the bottleneck of limited licensing systems.

We work throughout the country to navigate the licensing process carefully for clients – for MSOs this means taking their baseline plans that have worked in other markets and adapting them to the specifics of the state’s round and their hyperlocal context. For entrepreneurs stepping into the space for the first time, prioritize familiarizing yourself with the application contents from similar rounds and the language of the opportunity itself. Go to conferences and meetups, listen carefully to the discourse surrounding the round, get all of the specific advice you can from professionals related to your project, and set a goal to have your “shoes” ready by a specific time.

It takes more than money to win a cannabis license and entrepreneurial teams are pressed to develop their plan in such a way that the necessary capital infusions won’t dilute their ownership completely.

For microbusiness applicants, you need to clearly articulate the strategy for developing the application and gathering the necessary resources for the business. This is made up of the professional vendors who you will work with, the community programs you intend to follow through with, your persuasive narrative of relevant experience and regulatory compliance, and yes, a detailed account of how you will fund the project and grow into the future.

Q: What are the best opportunities for small license holders in the cannabis market, and what experience should applicants bring to the table?

A: The best opportunities will come from properly-scaled businesses that are competitive in the ways they can be. 2500 sq ft is not a lot of space compared to the massive efficiencies of scale in larger warehouses that can utilize more automation and rolling harvests to keep labor and output flowing evenly. However, 2500 sq ft is plenty of space for many cannabis operations and encourages specialization even more.

The previous rounds were burdened by the needs of medical patients and as the market broadens, we expect a thriving craft market that originates from the microbusiness concept. There are new products appearing like soft drinks, pharmaceutical finishing techniques, and radical genetics targeting minor cannabinoids – this is where the micro-scale can thrive.

Applicants must bring relevant experience themselves or find a clear way to articulate it through their team members and affiliates. You may not be able to offer equity if someone in your plan is from out-of-state, but there are always creative ways to create a compelling narrative around your experience and team. Wherever possible, work within the municipalities you are targeting and look for professionals with roots in the region to utilize as much of your ten-employee cap as possible.

Relevant experience changes based on the dynamics of the proposed business, but you will want people with experience in the exact operations you have planned and/or experience with regulatory compliance. Highly-regulated fields that require frequent reporting, training, and adaptation to new regulations are primary. One person cannot win a cannabis license by themselves – you want to tie-together a coalition with local momentum that is recognizable and proficient.

Q: What makes an applicant successful in standing out from the sea of competition?

A: Standing out from the crowd isn’t about flashy graphic design and ambitious plans for real estate – you have to create a sense of calm confidence backed-up by evidence and flanked by a critical mass of support in the region. The question of “how” turns quickly to presenting your business plan to interested parties, getting feedback from stakeholders throughout your team, and developing a pitch around competence.

To stand out, you need to focus on a specific narrative for success. For cultivation, this may mean a clever plan to utilize your 2500 sq ft backed with credible experience in the exact plan. For manufacturing, this will likely mean a compliant finished product that excites and carves a niche for new cannabis consumers while emphasizing quality wherever possible.

For wholesalers and distributors you will need to show supply chain management, logistics, and corporate administrative skills while emphasizing a degree of tangible community engagement programming. For retailers, compassionate care is still the grounding ethos to link the burden of representing the industry to newcomers with an educational and hospitable sales moment.

Standing-out is about accepting the competition into your plans and working to leverage the elements that are uniquely yours. Engage with the community, talk to experts, and build your story brick by brick.

Q: How should NJ structure its microlicense application process and program in order to reach the most entrepreneurs?

A: It is critical that the microbusiness is not treated as a second-class license hamstrung by its own design. The CRC might streamline the application process for microbusinesses, but they are required to institute a competitive process that demands similar organizational standards as the full annual license.

The CRC can utilize the conditional license as a vehicle to identify more social equity applicants, and advocates should spend significant energy (when details emerge) connecting prospective applicants to civic leaders and stakeholders to help meet the strict deadline. Social equity means ownership, and the CRC can make clear what they want to see in employee ownership programs, community enrichment strategies, expungement and reentry services, and how they want businesses to grow in the future.

Structurally, we have seen a variety of systems for application and all have some flaws. Lottery systems promote “scattershot” attempts where well-funded teams overload the scorers with applications in every jurisdiction to take their pick from the winners (see Illinois); granular scoring on larger scales creates intense scrutiny about the scoring process and an arms-race for narrative development (see 2018 NJ Medical); ceding selection criteria to the municipality creates a patchwork system that seems ever-shifting and subject to whims (see California). Markets with large numbers of licenses like WA, OR, or CO can bottom-out the wholesale price and small cultivators struggle to survive.

Professionals will adapt to the contours of the scoring system to present their case no matter the structure, and there will be legal challenges to the system regardless. Therefore, it behooves the CRC to create a system without caps where the application process can appear with regularity. There is a real need to get licenses out into the market soon, but by phasing the industry’s roll-out, the CRC will be able to refine their process and protect new entrants.

Q: What should the state regulatory commission be doing to enable women, people of color and disabled veterans to succeed in this space?

A: To ensure that historically disadvantaged demographic categories have success in the market, the CRC should require equity to be held by individuals in those categories and will need to establish how the relevance of certifications will adapt over time. The CRC is in a position to support applicants with thorough education about the application process and assistance in connecting to resources like capital and professional services.

The law calls for minimum percentages of the overall number of licenses to be held by individuals from disadvantaged demographics, but does not define how the CRC should handle the transfer of ownership and the approval process for uncapped categories over time. We do not want to see an industry where social equity applicants are massively in debt and forced to sell their license completely to operators from out-of-state (MA comes to mind), yet there needs to be a sustainable way for entrepreneurs to realize their gains and grow without sacrificing the integrity of the market.

If the CRC creates a system where demographic status earns points that cannot be earned elsewhere (unlike the five-year residency requirement that can also be scored through organized labor), they will essentially be making certification mandatory for limited licensing scenarios. This is not the worst outcome, but it will lead to more tokenism and creative presentation of ownership strategies. The CRC could accept this structure by establishing a community forum or database where people can connect to present their skills, desires, and needs during the development phase.

Creating a better industry is hard and over the past few years we have seen progress across the country, but there is no “magic bullet” to fix issues of disparity in corporate ownership and the financial momentum generated by the consolidation of wealth. It takes capital to enter the space and grow a sustainable business. For the sake of entrepreneurs risking their personal financial security, the CRC should prioritize a longer-term approach to the demographics of the market that can sustain as the industry changes over the next few years.

— Susan K. Livio | NJ.com

NJ Cannabis Insider Summer Speaker Series — in person: July 29

Cannabis delivery from state-licensed operators did not take off last year as anticipated after the pandemic forced the overall economy to pivot to on-demand products. Meanwhile, last week the New Jersey Attorney General Office’s moved to ban delivery companies that started “gifting” cannabis soon after the plant was legalized for adult consumers earlier this year.

At the same time, other states use the microlicenses and delivery mechanisms as primary jumping points for making a more equitable market — both factors that can serve as changemakers in the budding, multi-billion dollar industry.

This topic will be explored July 29 during NJ Cannabis Insider Live’s first in-person business mixer since the pandemic shutdown more than 15 months ago. The meetup takes place at the Asbury Hotel in Asbury Park from 6 to 10 p.m. Make sure to sign up early. Unlike our virtual events, capacity is limited to 150 individuals. (Purchase tickets here.)

The four-hour session will include the panel, “Delivery, equity and microlicensing,” featuring:

• Precious Osagie Erese is Chief Operations Officer of CBD delivery company Roll Up Life
• Ellie Siegel, CEO of cannabis consulting firm Longview Strategic
• Bob Anderson, an attorney at the firm Lindabury, McCormick, Estabrook & Cooper
• Sydney Snow, is senior manager of Government and Community Affairs at Eaze Technologies

The meetup will be at the beautiful Asbury Hotel in Asbury Park from 6 to 10 p.m. Make sure to sign up early. Unlike our virtual events, capacity is limited to 150 individuals. Use code INSIDERMEET at checkout for $20 off the ticket price.

Thank you to our sponsors, so far:

• Hance Construction was selected to build one of the first cannabis grow facilities in New Jersey, and has since worked on other medical cannabis projects, offering consulting and site-location services.
• Supreme Security Alarms, New Jersey leaders in the security space, providing custom designed, state-of-art systems to protect your business.
• Harvest 360 is a cannabis consulting company that specializes in application preparation and licensing management, working to reduce barriers of entry for communities most impacted by the War on Drugs.
• Lindabury, McCormick, Estabrook & Cooper, with its Cannabis Industry Team provides transactional and litigation counsel to businesses operating in the cannabis industry, helping clients navigate the complex federal, state and local regulation.
• Longview Strategic provides advisory services and industry insights to clients throughout the country’s emerging highly-regulated markets, with a specialization in licensing opportunities and an aim to empower, develop, and position thought leaders to succeed through a professional network of ancillary service providers, and authentic engagement with local communities.
• Shore Grow is an Ocean, N.J.-based company, offering consultation and supplying commercial farmers in New Jersey — whether it be vegetables, hemp or cannabis — who grow organically in soil outdoors or hydroponically indoors.

If your company would like to sponsor this or future events, including our Sept. 15 in-person conference, please contact us here.

— Enrique Lavin

Rep. Bonnie Watson Coleman

More Americans are arrested for possessing drugs than any other crime — the number was 1.35 million last year — and as we approach the 50th anniversary of the War on Drugs, Rep. Bonnie Watson Coleman (D-12th Dist.) says we must rethink our approach to the social catastrophe that has caused a half-century of misery, mostly for communities of color.

Most of us agree: A new poll says that 83% of Americans believe that the War on Drugs has failed, and 66% support the elimination of criminal penalties for possession and an increased investment in treatment and addiction services.

Accordingly, the fourth-term rep from Central Jersey has co-authored a bill with Rep. Cori Bush (D-Mo.) that eliminates criminal penalties for “personal use” possession, expunges criminal records, prohibits discrimination based on past drug arrests, and shifts regulatory authority from the Attorney General to Health and Human Services. It pertains only with individual users — not drug dealers or kingpins — and the aim is to end criminal justice intervention and focus on harm reduction.

This piece first appeared on NJ.com.

Q. Your bill, the Drug Policy Reform Act, coincides with the 50th anniversary of Richard Nixon announcing the War on Drugs. What is the legacy of this American tragedy?

A: The legacy of the War on Drugs was the devastation of Black and brown families, entire communities of color, and it didn’t leave us any better and it didn’t alter safety, security, or diminish drug use. It was a malicious attempt to marginalize people, with people they referred to as hippies and the Black folks as their target, and they obviously succeeded as it relates to the Black family dynamic.

Q: You are referencing the confession from John Ehrlichman, Nixon’s infamous domestic advisor, who admitted in 2016 that the War on Drugs was devised mostly to destroy the two enemies of the Nixon White House: the antiwar left and African Americans. He admitted that the goal was to criminalize both groups by spreading fear and lies.

A: And it shows you how this is cyclical because we live in another age of dangerous lies now, with Donald Trump and his attempt to target communities as “the others” and making sure that it is more difficult for them to access equality and freedom. Even though President Biden just signed in the Juneteenth federal holiday, people should be reminded that as we look over our history, we have serious bumps and detours. We don’t have any linear or vertical progress that isn’t disrupted by intentional, systemic racism in the hands of those who are in charge of systems and governments.

Q. Does it seem Kafkaesque that we thought we could incarcerate our way out of the drug problem?

A: Our reputation throughout the world is having the most incarcerations per capita, which has debased and bastardized our Americanism more than anything else. I don’t think that there’s anything that equals what we’ve done in this country, in terms of incarcerating individuals to marginalize them, to weaken their family structure, just to establish a false sense of security and superiority for other people.

Q: Do you sense the public mood shifting in recent years on how we’ve treated drug consumption as a criminal offense and addiction in general?

A: Yes, because when we ultimately realized that most of the opioid abuse was happening in white communities, we recognized substance use and abuse as the issue of help, not of criminality. So out of that unfortunate circumstance, we recognize that this is an issue that needs to be dealt with by health experts. This needs to be addressed with treatment options and methodologies and counseling and things of that nature, not incarceration.

Also, when you think about the folks that were incarcerated because they had a small amount of drugs on their possession, they don’t come out of prison more ready to rejoin society. They didn’t get the help for their need to use drugs. They didn’t have their mental health issues addressed. They were punished. And that punishment has not made society any safer or healthier. As a matter of fact, it is responsible for the devastation of the Black family.

Q: There is a great amount to review in your bill, but much of it will follow guidelines laid out by an 18-member council established under Health and Human Services, right?

A: First of all, we want this bill to be an acknowledgement that Congress recognizes the War on Drugs didn’t work. It contains a requirement that if this bill passes, states are incentivized to decriminalize personal use of these drugs as well, in order to be eligible for federal grants in various programs.

But it establishes under HHS an advisory commission of people with diverse backgrounds – from current users and the formerly incarcerated to doctors and social workers and counselors. This council will look at the benchmarks for personal drug use that should fall under this bill. It will report on patterns of drug usage related to income, employment, geography, that sort of thing. And then, taking resources now used for incarceration and putting them into more health-related services, and looking at the research needed to support healthier outcomes for people with dependencies. There are many different categories of users, from the occasional marijuana smoker to the dangerously addicted. We need to establish a context for who the users are.

Q: There is also a great emphasis on expungement and reentry.

A: We need to have records expunged for those currently or formerly incarcerated. There is an expectation that the court systems in individual jurisdictions will look at the sentencing of individuals and determine whether they are in violation of any law after this bill passes. It would also prevent the federal government from banning people who have had drug convictions from accessing assistance for housing, SNAP, TANF, etc. It’s a significant shift in how we’ll look at people and re-examines the economic cost to our society — what it takes to incarcerate, as opposed to going through the health care system.

Q: Even if the country is ready for a health-centered approach to drug policy reform, won’t this be a monumental political lift?

A: It’s a long haul, we know that. There’s a lot of educating to be done, we’re going to reach out for co-sponsors and to advocates like Drug Policy Alliance to help us all recognize the unfairness of the situation as it currently exists. And we need to make sure that Congress — both sides, both chambers – understands that Americans do support a health-centered approach to individual drug use and to those who have abuse problems. Congress isn’t always in step with most Americans on so many different levels, as you already know.

Q: Can you name a single Republican, even from its libertarian wing, who envisions a sweeping decrim bill the way you have envisioned it?

A: Nope. That’s the first time someone has asked that question, and I’ll get it a lot — we just introduced this legislation, although we have been working on it for quite a while. I haven’t done any outreach to Republicans yet. I know folks have a different perspective on this. But let us see and let us hope. Because if they are in touch with the people in their districts, they will find out that a majority of people believe that we need a new approach as it relates to the individual use of drugs.

But it really comes down to this: Let’s make our communities safer and healthier, because a problem we’ve historically treated as a criminal problem is only getting worse because of our failure — long before the opioid issue arrived. People know there is a smarter model than the monstrosity conceived under the War on Drugs.

— Dave D’Alessandro | Star-Ledger Editorial Board

State senators push for investment into education

We’re still months away from knowing how the Cannabis Regulatory Commission will run the adult use market in New Jersey and disburse tax revenue to benefit the communities hardest hit by the drug war.

But state Sens. Teresa Ruiz, D-Essex and Troy Singleton, D-Burlington are advancing a bill that would dedicate a portion of the tax proceeds to fund educational programs in impacted communities.

Introduced in December, the bill (S3213) passed the state Senate on Monday and now needs action in the Assembly.

“A solid education is the greatest equalizer we have and the best avenue we have to ensure a more equitable future for the children of New Jersey. By confronting the disparities within our education system we can invest in meaningful programming to address them and begin to shrink the achievement gap plaguing our state,” said Ruiz, chairwoman of the Senate Education Committee after the Senate approved the bill by a 34-5 vote Monday.

“The criminalization of cannabis has had a severe, generational impact on the well-being of African American and Latinx communities around the state. It is only right that revenue generated from legalization should be funneled back into those neighborhoods that were disproportionately harmed by marijuana prohibition and its discriminatory enforcement,” Ruiz said.

The New Jersey Community Learning Program would be available to municipalities which meet the qualifications of an impact zone. They include municipalities with concentrations of law enforcement activity, unemployment and poverty that have a population of 120,000 or more or have an unemployment rate of 15% and ranks in the top 40% of municipalities in the state for marijuana or hashish-related arrests, according to the bill.

After holding two public hearings to solicit ideas, local school board officials would petition the state Department of Education for funding, outlining what the program would teach, where it would be held, and an estimate of how much it would cost, according to the bill.

The law calls for dedicating 70% of cannabis tax revenues to impact zones. But the commission is working on the rules that will dictate how that will happen.

Nearly every state with legal cannabis has devoted a portion of the revenues to support K-12 education, according to the Education Commission of the States, a national research and advisory organization.

Oregon devotes 40% of its cannabis revenue to education, Colorado, 12% and Illinois earmarks 2%, according to the Motley Fool, a financial information website.

There are certainly ample examples of how New Jersey should share the wealth.

“This legislation will work to uplift those impacted by the collateral consequences of the War on Drugs, through educational programs, so we can begin to undo the generational harm done by these policies and ensure a more equitable future for our children,” Singleton said, chair of the Senate Community and Urban Affairs Committee who has sponsored other bills shaping the legal cannabis market.

“This will help to right the wrongs of those policies by working to close the learning gap in these communities,” he said.

— Susan K. Livio | NJ.com

Curaleaf NJ expands footprint with new location

Curaleaf, the largest medical cannabis provider in New Jersey, will open its first satellite dispensary in Edgewater Park Friday.

The Massachusetts-based company also said Thursday that its second cultivation site in Winslow has completed its first harvest, which triples the company’s cultivation capacity.

Curaleaf was already a leading wholesaler to other medical cannabis dispensaries in the state.

The Edgewater Park dispensary is located on Route 130. It is the 20th to open in New Jersey, and Curaleaf’s 107th dispensary in the U.S. The company plans to open its third dispensary later this summer.

The company has also launched an initiative called Rooted in Good. It is working to draw at least 10% of new hires this year from communities harmed by cannabis prohibition.

The company has also stated that it is also searching for partnerships with cannabis brands, ancillary suppliers and advocacy organizations from underrepresented communities.

“We are committed to both serving our patients and being a good member of our local communities,” Patrik Jonsson, the company’s northeast regional president, said in a statement.

— Amanda Hoover | NJ.com

Cannabis delivery before regulation navigating AG pushback

As legislators continue working to set up a legal retail market for recreational cannabis, there’s a chess game playing out between authorities/regulators and entrepreneurs who aren’t waiting around to set up shop.

For one, the current move is free weed.

Gary Bozzini, owner of Sky High Munchies LLC, said the online vendors he’s been using for payment processing — Venmo, Stripe, and PayPal — have frozen about $140,000 in customer paents in their systems, barring him from withdrawing it to his bank.

So he’s issuing refunds.

“They’re holding up a lot of money on us, because they’re saying we sell marijuana. We don’t sell marijuana, we sell munchies,” he said. “We’ll give it back” rather than let the companies keep it.

Bozzini’s situation illustrates one major challenge that has cropped up in state after state as legalization has expanded. Because it’s still illegal at the federal level, federally-insured banks don’t want to deal with marijuana money.

Sky High is one of several companies that until recently called themselves “gifting services,” because customers order merchandise like food and clothing and then choose a “free gift” of smokeable or edible cannabis.

That was until the state Attorney General issued cease-and-desist letters, saying the companies could be in violation of Consumer Fraud Act, which bars gifts that require a purchase. The cease-and-desist notices issued on June 15/check this date and add link to doc/ don’t address marijuana possession, sale, or distribution.

Since then, Bozzini has retooled SkyHigh’s website and radio commercials to remove references to gifts and now simply offer a snacks-only option and show the cannabis products as order options, like toppings on a pizza.

It’s a game he’s playing carefully, and one step at a time, and with no guarantee he and the other company owners won’t end up in jail or broke.

To Bozzini, Gov. Phil Murphy isn’t the problem — he said he counts the governor as an ally in the movement to bring legal weed to New Jersey residents who voted for it.

“The law says we’re allowed to transfer marijuana to anyone 21 years of age and older,” Bozzini said.

“The Consumer Fraud Act that they’re telling us we’re frauding the customer, the government is frauding the consumer because they promised them something four years ago and haven’t done it.”

Bozzini, a medical marijuana card holder, said he first learned about the idea of cannabis “extras” while on a road trip from Tennessee back to New Jersey. He’d run out, was in pain, and still far from home. A Google search led him to a detour through Washington, D.C., where he could legally purchase weed products if he also sat in on a seminar about the strains he received.

“As I got into the car with a shopping bag in my hand and a receipt in my hand I said to my fiance, “Let’s move to Washington, D.C. We did not move to Washington, D.C., but when the law went into effect [here] I started reading into it.”

SkyHigh Munchies began operating on March 5 and now counts 15 workers who do order processing, customer service and delivery. Bozzini says he and other operators know they’re operating in a bit of a gray area but are banding together to stay in business.

“I have accountants, and I have lawyers, and we try to keep things 100 percent businesslike,” he said.

Edmund DeVeaux, president of the New Jersey CannaBusiness Association, said businesses jumping ahead was inevitable in a process that has taken its fair share of time in a business where most of the supply is coming from unregulated sources of cannabis.

With the New Jersey Office of Attorney General claims that operations like Bozzini undercuts the market, DeVeaux said it’s hard to make such an argument when the market is not fully set up.

“We do not have an adult-use program yet, so you can’t undercut what doesn’t exist,” he said.

Where does Bozzini get the weed and edible products? That’s currently the one area he doesn’t talk about. He says while the products aren’t tested and certified like the medical stock at dispensaries, their products are authentic, not bootleg quality, and quality tested by staff before being offered.

One concern with companies like his is the potential effect on the legal medical marijuana market, where product supply can be limited and pricey. And the class of license that would allow those dispensaries to deliver doesn’t exist yet.

Bozzini said his company waives its $50 delivery fee for state medical marijuana card holders.

“Our drivers never have more than five ounces on them, ever. And if they do, there’s a second guy in the car with them” both for security and to stay within the current personal possession limits.

Bozzini said he’s not escrowing sales tax on the marijuana, because he sells prepackaged food, not weed. If and when a sales tax is settled on for retail pot, he said, he’ll revamp the business and pay the sales tax.

“We want to pay our taxes, we want a license. We are doing everything that we have to do,” he said.”

— Amy Z. Quinn | NJ.com

Lack of reparative justice a red line for a federal cannabis bill

Supporters of legislation to end the federal ban on marijuana have issued one non-negotiable demand: Any measure must address the decades-long impact that the War on Drugs has had on minorities.

“Low-income and communities of color disproportionately bear the brunt of the war on drugs and it is not enough to legalize the substance that put them in this precarious situation,” said Sakira Cook, senior program director of The Leadership Conference on Civil and Human Rights.

The Marijuana Opportunity Reinvestment and Expungement Act, or MORE Act, which passed the House last December and was reintroduced in May, would tax cannabis and related products to fund job training, drug treatment, literary programs, loans to small cannabis businesses owned by socially and economically disadvantaged individuals, and programs to help those hardest hit by the War on Drugs enter the cannabis industry.

That’s the bill House Democratic leaders have championed rather than the bipartisan Strengthening the Tenth Amendment Through Entrusting States Act, or STATES Act, which simply prohibited the federal government from blocking states from legalizing cannabis but did not include any restorative justice provisions.

“Democrats believe that federal reform must include robust social justice provisions to assist those disproportionately impacted by misguided cannabis policies to re-enter society and benefit from a new legal marketplace,” said David Culver, vice president of international government relations for the cannabis company Canopy Growth Corp.

“I believe that Congress will not act on other provisions, like the STATES Act, until they have attempted to deschedule with legislation inclusive of comprehensive social justice provisions because, put simply, it’s the right thing to do.”

On the Senate side, U.S. Sen. Cory Booker is helping to draft legislation to end the federal cannabis ban and help communities ravaged by the War on Drugs. He said any bill must include provisions to fix the problems caused by enforcing the cannabis laws.

“We’re very, very focused on restorative justice and I will fight against anything that doesn’t have restorative justice,” Booker said. “There’s been so much damage done from marijuana, the War on Drugs. People are still suffering from all the unjust persecution of this long prohibition that we’ve had in America.”

The bottom line by advocates and legislators focused on the industry: Ending the federal ban on cannabis and allowing states to legalize the plant is not enough.

“We want to see an effort that not only ends marijuana prohibition but also includes expungement, resentencing, reinvesting money in communities that have been devastated by over-enforcement of marijuana laws,” said Queen Adesuyi, national policy manager for the Drug Policy Alliance. “It’s the only way to properly address the harms of prohibition without leaving out the communities that borne the brunt of enforcement.”

— Jonathan Salant | NJ.com

Harvest360 launches accelerator program for social equity applicants

Cognitive Harmony Technologies Accelerator has received a $100,000 donation from Pangaea Health and Wellness for scholarships to put five social equity cannabis license applicants in New Jersey through its accelerator program.

Winners will be selected from a pool of qualified applicants identified by CHT Accelerator partners NJ Cannabis Insider and the New Jersey State Veterans Chamber of Commerce.

“The NJ State Veterans Chamber of Commerce is actively seeking veterans to qualify for this amazing scholarship with Harvest 360. To date, the state has not awarded any veterans a cannabis license and we are hoping this changes through this scholarship,” said the chamber’s CEO and founder Jeff Cantor, a retired U.S. Army colonel.

CHT Accelerator is a joint venture by a team of cannabis business veterans who are software engineers and Harvest 360 Technologies, a wholly owned subsidiary of Blue Diamond Ventures Inc.

“CHT Accelerator was designed by successful license applicants to level the cannabis business playing field for social equity applicants as they apply for licenses and operate their businesses,” said David Serrano, managing partner for CHT. “This generous donation can help expedite applicants’ acquisition of industry knowledge and improve their chance of entering — and succeeding — in New Jersey’s cannabis industry.”

The CHT Accelerator provides templates, training guides and high intensity coaching sessions developed by cannabis industry professionals to quickly educate social equity cannabis license applicants on the intricacies of the cannabis license application process and business operations.

The goal, Serrano said, is to enable applicants who have been negatively impacted by the War on Drugs to earn top scores and New Jersey state cannabis licenses. To apply for the NJ Cannabis Insider-partnered scholarship, go here.

“It’s part of NJ Cannabis Insider’s mission to elevate minority operators in the cannabis space,” said Enrique Lavin, publisher and editor of NJ.com’s weekly cannabis trade journal. “We are honored CHT chose our media group to partner for this very important work.”

Beyond the $100,000 no-strings-attached sponsorship, Pangea Health is dedicating 20,000 square feet of space as a cannabis business incubator and education center, said Larry Frascella, CEO of Pangaea Health. The idea, he said, is to provide free support to social equity businesses, and microbusinesses, as well as low interest loans, a dispensary accelerator program, employment opportunities and more.

“The cannabis license application process can be overwhelming, particularly for applicants that may have more limited resources than their well-established competitors,” Frascella said. “As a New Jersey cannabis license appellant, this donation to CHT Accelerator is follow-through on our supplemental submission commitment to provide free resources to educate minority, women, and disabled veteran cannabis license applicants whose representation in the New Jersey cannabis market is required by the New Jersey Cannabis Regulatory, Enforcement Assistance, and Marketplace Modernization Act (Act).”

The CHT Accelerator application platform provides up-to-the-minute application templates, guides and coaching tailored to each state’s current regulation. The CHT Accelerator also has developed and beta tested in Illinois a fair and unbiased mechanism to score applications that is customizable to each state’s applications.

As CHT users become licensed business operators, the CHT Cannabis Business Operating System (CBOS) provides guidance to ensure that every function of daily operations is maintained in compliance with original application submissions as well as the rapidly evolving multi-jurisdictional compliance landscape.

For more information, visit www.cognitiveharmony.tech.

Do you know a town that should be included? Send us a note at tips@njcannabisinsider.biz

To access the archives for issues 0-152, use this passcode: more-njci