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Ready, Set, Grow: The Cannabis Industry Is Slowly Growing In New Jersey. That Means There Still Is Time To Jump In. But How?
March 24, 2023
Robert E. Schiappacasse and Jason K. Gross, Sills Cummis & Gross Cannabis Industry Practice Group Co-Chairs, answer questions entrepreneurs and others operating in the cannabis industry need to know in this ROI-NJ industry-related Q&A.
Here is what Schiappacasse and Gross had to say:
What aspect of the cannabis industry does your firm specialize in (compliance, growth, distribution, etc.)?
Schiappacasse: We represent clients in cannabis-related transactions and litigations. We are well-versed in the medical and adult-use cannabis industries and the associated laws and regulations. Our areas of experience include: corporate and commercial transactions; mergers & acquisitions; corporate formation and business licensing; fund formation and investment management; state (New Jersey Cannabis Regulatory Commission) licensing; state and federal regulatory; branding and intellectual property protections; commercial licensing agreements; banking and financial compliance; real estate law, including zoning and land use; environmental law; litigation and insolvency; secured creditor issues; employment law; and tax law.
Can you tell us something someone new to industry needs to know — that they probably haven’t thought of?
Gross: The New Jersey Economic Development Authority is about to roll out a Cannabis Equity Grant Pilot Program that will provide funding for cannabis businesses. It is available to conditional and annual New Jersey adult-use license holders and will provide grants of $250,000. These are not loans and do not need to be repaid.
Give us one factor that is key to getting a license.
Schiappacasse: Obtaining ‘site control’ over real estate is critical to getting a cannabis license. Site control means, generally, exclusive rights to a proposed location for a cannabis business and can be demonstrated by lease or deed or similar documentation. In determining the right location, it is important that the applicant identify a municipality that has not ‘opted out’ of the cannabis industry and that local zoning set-back and other requirements are met. While New Jersey’s adult-use licensing process does allow applicants for conditional licenses to initially defer site control until later in the process, it still remains the most critical element for ultimate success.
How do you see industry growing/changing in next 12 months?
Gross: Exciting times are ahead of us. There will be many more adult-use retailers opening up. We will hopefully see the beginning of a licensed delivery program so that customers do not need to travel to dispensaries if they are not able to do so, or just prefer the convenience of delivery. We may even begin to see cannabis lounges.
How has the slow start helped or hurt the industry?
Schiappacasse: We all wish the industry was moving quicker, but we are excited that the state and various municipalities are devoting resources to make sure the industry progresses in ways that benefit all involved. The state has been deliberate in its approach to adult-use cannabis in order to protect patients by ensuring that they have sufficient access to cannabis products. That is a worthwhile cause. It is true that adult-use operators and customers have had to wait a bit longer (and in some areas of the state are still waiting for the number of retail locations to meet demand). On the positive side, the longer wait time has enabled applicants more time to prepare and learn from the legacy operators what works and what doesn’t.
Give us your elevator speech: Why should someone hire your firm?
Gross: Sills Cummis & Gross is no stranger to the dawn of a newly regulated industry. As one of a few law firms involved at the outset of the legalization of gambling in New Jersey, we understand the political, business and legal challenges clients will face. In that spirit, we work both to understand the regulatory framework and to guide our clients to maximize the benefits and protections available under existing and proposed laws and regulations.