NJ's Broken Promise
How New Jersey's Cannabis Funding Leaves Many Behind
The formidable truth has risen from the ash after recreational use was legalized in New Jersey. This state (and many others) claims social reform, but when you dig through the legislation and fine print, it just leads back to one thing, and that one thing is greed. New Jersey is supposed to be leading the charge in cannabis reform, and helping those who have been convicted or affected by old cannabis laws.
The way that New Jersey has been doing this is by giving people who are residents of new jersey & been convicted of a cannabis crime, (or has a family member that’s been convicted of a cannabis crime), first pick to apply and receive a licence to grow, sell, or test cannabis. This is great for social reform, this is great for giving back to the under-served people of NJ, who have been ostracized, paid fines, lost their licence, jobs, freedom, etc! Over cannabis laws, myself included.
This is only telling half of the story. These licences to sell cannabis are extremely expensive, and of course are tied right into the millions of tax dollars New Jersey will receive back from one applicant, in a few years time. All of the grants & programs that were set up in Jersey, for social reform & justice for those who suffered the most from cannabis inequity, are all tightly tied to having and obtaining a cannabis licence. This excludes all other cannabis related non-plant touching businesses from all state funding programs, grants, loans, etc.
How I see it, as the owner of a non-plant touching cannabis business in NJ, is pretty unfair! In layman's terms, it seems NJ is only interested in helping Cannabis companies that will produce tax dollars, cutting out a huge chunk of the ancillary cannabis industry, that are not interested in selling or growing cannabis directly. Cannabis is evolving at an extreme rate, educators need to be in place, testers and product reviews are essential for keeping these cannabis companies honest. This is the path I've taken, this was my vision for a platform, but New Jersey wont help me cause I don't sell weed. It’s ironic that I went to prison for selling cannabis during prohibition, now I want to push the needle on education and can’t find help. To me, this is a broken system that needs to be changed.
Beyond the Plant: An Analysis of NJ's Funding Flaws
Executive Summary
New Jersey's legalization of adult-use cannabis, codified in the Cannabis Regulatory, Enforcement Assistance, and Marketplace Modernization (CREAMM) Act, was founded on the dual principles of establishing a safe, regulated market and rectifying the historical injustices of the War on Drugs. A central pillar of this framework is the state's commitment to social equity, intended to provide a pathway to ownership for individuals from communities disproportionately harmed by prohibition.
However, a critical and systemic flaw in the state's funding architecture threatens to undermine these foundational goals. Current grant and loan programs administered by the New Jersey Economic Development Authority (NJEDA) are exclusively available to "plant-touching" businesses—primarily cultivators, manufacturers, and retailers. This narrow focus systematically excludes the entire ecosystem of non-plant-touching (NPT) businesses, which are essential for a healthy, competitive, and equitable market.
This report provides a comprehensive analysis of this policy disconnect. It begins by defining the vital NPT sector, which includes not only state-licensed entities like wholesalers, distributors, and delivery services, but also a vast array of unlicensed ancillary businesses providing critical support in education, compliance, technology, and professional services. These NPT businesses represent a significant portion of the cannabis economy, yet they are ineligible for the very programs designed to support social equity.
The Policy Disconnect: A Deep Dive into the CREAMM Act
The CREAMM Act established a progressive framework, but its implementation reveals a significant gap. Section 26 of the Act mandates that the CRC provide for a "social equity excise fee" on the sale of cannabis. The revenue from this fee is funneled into the Cannabis Social Equity and Reinvestment Fund (CSERF), managed by the NJEDA. The explicit purpose of the CSERF is to promote social equity initiatives, including financial assistance for cannabis businesses.
However, this is where the policy disconnect becomes apparent. The NJEDA's programs, such as the Social Equity Small Business Grant Program and the Cannabis Business Loan Program, are strictly limited to businesses holding a valid New Jersey Cannabis Regulatory Commission (CRC) license. This license requirement inherently favors plant-touching businesses, as they are the primary recipients of these licenses. While the state-licensed NPT businesses like wholesalers and delivery services are not "plant-touching," they are still part of a heavily regulated and licensed framework that faces significant capital barriers.
The Overlooked: Ancillary and Non-Plant-Touching Businesses
The true irony lies in the exclusion of a vast number of ancillary and NPT businesses that are not subject to CRC licensing but are vital to the cannabis ecosystem. These include:
- Professional Services: Accounting, legal counsel, and business consulting.
- Education & Advocacy: Public health awareness, consumer education platforms, and advocacy groups.
- Marketing & Technology: Digital marketing agencies, website developers, and e-commerce platforms.
- Product Review & Media: Content creators, reviewers, and journalists.
These businesses are often smaller, more nimble, and represent a more accessible entry point for entrepreneurs from marginalized communities who may lack the millions of dollars in capital required to secure a plant-touching license. The current funding structure essentially creates a two-tiered system, where only a select few are eligible for state support, while the broader ancillary industry is left to fend for itself.
Addressing the THC-A Loophole and Other Industry Issues
The current system also fails to address a number of critical market and consumer safety issues. For instance, the lack of regulation and funding for ancillary businesses means there's little state support for those tackling complex issues like the THC-A loophole, which allows unregulated cannabis-derived products to flood the market.
Furthermore, while the legal framework is being debated, other constitutional clashes, such as the constitutional clash between cannabis and gun rights, are leaving individuals in legal limbo. The state's focus on licensed operators for funding leaves the important work of education and advocacy to under-resourced private entities.
There are also serious public health concerns, such as the high potency paradox, that need to be addressed through education. The current system provides no pathways for funding for organizations that could fill this essential role.
The Path Forward: Reforming the System
To truly fulfill its promise of social equity, New Jersey must expand its grant and loan programs to include all cannabis-related businesses, regardless of their "plant-touching" status. This would not only provide much-needed capital to a wider range of entrepreneurs but would also foster a more diverse and resilient cannabis ecosystem.
By broadening the criteria for funding, the state can empower a new generation of business owners who are committed to education, innovation, and community building—the very pillars that will ensure the long-term success and integrity of New Jersey's cannabis market. It's time for the Garden State to move beyond its singular focus on tax revenue and embrace the full scope of what an equitable cannabis industry can be.