New Jersey’s legalized market for recreational cannabis continues to grow as sales hit $132.48 million between October and December 2022, according to the state.
When receipts for medicinal cannabis are factored in, sales topped $182.36 million for the period. According to the state, the 23 dispensaries licensed to sell medicinal products pulled in $49.87 million in sales, down from the prior quarter’s total of $61.87 million.
Since the launch of New Jersey’s legalized adult-use market last spring, enrollment in the Medicinal Cannabis Program has steadily declined. Between April 2022 and April 2023, the number of patients seeking medicinal treatment has dropped from 128,548 to 108,760, according to the state.
CRC Executive Director Jeff Brown told NJBIZ, “The sales numbers and tax revenue from New Jersey’s cannabis market are encouraging.”
“They indicate there is broad and growing demand for recreational cannabis products and that there is still a need for medicinal access,” he said. “As more local entrepreneurs get into cultivation, manufacturing, and retail we expect to see the market benefit from increased competition with wider product variety and lower prices.”
In an effort to spur development and encourage more diversity in the marketplace, the CRC enacted several changes in February, including letting the state’s cap on the number of cultivation licenses expire and improvements to the overall licensing process.
Additionally, the regulatory board ended the state’s ban on certain vertically integrated businesses. It also adjusted the criteria for priority applicants to require all social equity, diversity-owned businesses and impact zone applications for annual and conversion licenses be reviewed before all others.
When it comes to how New Jersey should invest tax revenue generated from the market, the state is still determining what the priorities will be.
Under the law in New Jersey, at least 70% of all tax revenue, including social equity excise fee revenue, is supposed to be invested in “impact zones”—defined as cities with higher-than-average unemployment rates, crime indexes and cannabis arrests.
For 2023, the state anticipates $1.5 million will be raised by the SEEF, which is $1.52 per ounce on all cannabis sold, according to the most recent figures available.
Based on public feedback the CRC received during a series of hearings, as well as SEEF revenue projections, the board’s first set of recommendations call for investing in grants and training/technical assistance for aspiring entrepreneurs in impact zones and economically disadvantaged areas.
Specifically, the resources would go toward the New Jersey Economic Development Authority’s Cannabis Equity Grant Program, which will provide grants of up to $250,000, and training programs run by the New Jersey Business Action Center.