New Jersey Marijuana Social Lounges

So, you’re considering applying for a marijuana retail license after the recreational adult use law is passed in New Jersey. The current version of Senate Bill No. 2703 (August 30, 2018) has several conditions that an applicant for a marijuana retail license must meet in order to have any chance of its application being approved. Of course, until the bill is actually signed into law and regulations are adopted by the regulatory agency for the recreational use marijuana industry (identified as the State “commission”), all of the conditions in the bill are not set in stone.

One interesting highlight of the current draft bill is that it will allow marijuana retailers the opportunity to offer a social space for patrons to consume marijuana – i.e. a “marijuana consumption area” (MCA). An MCA is defined as any area of a premises where an endorsement issued as part of the adult use law permits on-premises smoking or otherwise consuming marijuana. The area must be enclosed by solid walls or windows, a ceiling, and a solid door, and be equipped with a ventilation system that is exhausted separately from the nonsmoking areas so that air from the smoking areas is not recirculated to the nonsmoking areas, and smoke is not backstreamed into the nonsmoking areas.

Under the MCA section of the bill, a local governmental entity may authorize the operation of an MCA for the personal use, medical use, or both personal use and medical use of marijuana within its jurisdiction through the enactment of an ordinance. Notably, the MCA section of the bill also states that a local governmental entity cannot allow an MCA to be located within 1,000 feet of a boundary with an adjoining jurisdiction that does not permit retail marijuana establishments within its boundaries.  The MCA must be “physically separate” from the retail premises, but in the same local jurisdiction. Moreover, the MCA must ensure that the display and consumption of any marijuana is not visible from outside of the establishment. Thus, MCAs may appear from the outside like a pornography retail store or a strip bar.

In order to operate an MCA under a retail license, the license holder must also apply for an “endorsement” from the state commission and the local governmental entity where its retail establishment would operate. The retail license holder is prohibited from operating an MCA without state and local approval.

Under the current draft bill, the MCA endorsement from the local governmental entity is valid for one year and may be renewed annually upon the renewal of the marijuana retail license or the medical marijuana dispensary’s permit.

So what can patrons and operators do within an MCA? The draft bill allows the following activities:

• a person can bring medical or retail marijuana, medical or retail marijuana concentrate, and medical marijuana-infused product, or a retail marijuana product into an MCA; or
• distribution in the establishment of free samples of medical or retail marijuana, medical or retail marijuana concentrate, medical marijuana-infused products.

You will not, however, be able to buy a beer and a pack of cigarettes with your marijuana products. An MCA and its employees would not be permitted sell alcohol, including fermented malt beverages or malt, vinous or spirituous liquor, sell tobacco or nicotine products, or allow the consumption of alcohol or tobacco or nicotine products on premises, or operate as a retail food establishment. On-duty employees of the MCA are also prohibited establishment to consume any medical or retail marijuana, medical or retail marijuana concentrate, medical marijuana-infused products, or retail marijuana products in the establishment.

In addition, there are strict measures relating to sales limits, and taking your unused marijuana products home with you when it is closing time. The patron may leave the establishment with product that he or she does not consume only if, prior to leaving the premises, the product is packaged and labeled to the requirements of the law. And when a patron leaves the MCA, the establishment must destroy any remaining unconsumed retail marijuana, retail marijuana concentrate, retail marijuana products, or medical marijuana that are not taken by the patron.

Through the introduction of MCAs, the recreational marijuana bill would allow for adults 21 years of age and older to consume marijuana in places outside their home. Although this approach would create more social opportunities with marijuana use, it would also cause concerns with driver safety. In light of the driver safety concerns, one can certainly foresee local governmental entities opposing MCAs. Thus, MCA endorsements by local governmental entities will be very valuable to a marijuana retail establishment.

If you have any questions about this post or any other related matters, please contact me at wjbeneduce@norris-law.com.