NJ might take away your favorite THC seltzer, delta-8 weed under new hemp bill
Two years after the first legal weed sales took place in New Jersey, a different cannabis market (but not too different) is at the center of yet another piece of complex legislation sitting on the governor's desk.
In late June, the state Senate and Assembly voted overwhelmingly to pass a bill establishing regulations for intoxicating hemp products that would prohibit their sale to anyone under 21 and allow municipalities to place a 2% tax on their sale within their borders.
If Gov. Murphy signs the bill into law, the New Jersey Cannabis Regulatory Commission, the state authority that regulates the cannabis market, would be charged with drawing up rules and regulations, including labeling, testing and safety standards.
But until those rules are created? All those hemp products would be pulled off the shelves.
The bill sits at the vortex between the cannabis, hemp and liquor industries, each of whom want a piece of what's become a booming market. As a result, what began as legislation designed to get untested products off shelves and prevent their sale to minors gradually became a discussion over how to divvy up the spoils.
Caught in the middle are small business owners on the verge of a major disruption.
The Farm Bill came out in 2018, so why is this an issue now?
New Jersey does have hemp regulations, requiring hemp farmers and producers to obtain a state license and submit to state inspections and testing.
But there isn’t such a license for retailers. And the vast majority of products sold in New Jersey are coming from other states, so there’s no guarantee those products have gone through any sort of testing or quality assurance.
Some legislators have tried to pull these products off shelves before, but those bills stalled.
Senate Majority Leader Teresa Ruiz
There’s no one big moment that spurred action. It was simply the growth in popularity and availability that led to the political pressure to finally take action.
Senate Majority Leader Teresa Ruiz, D-Essex, said she only became aware of intoxicating hemp products after a call from a Newark police officer asking her if she knew anything about them.
“This has been happening in the state of New Jersey for I don’t know how long,” Ruiz said at a committee hearing on the bill last month. “There’s no clear definition because the feds left it so loosely that there’s a big gaping hole that not only impacts the state of New Jersey but the entire country.”
Why are liquor stores part of the discussion?
Without a doubt, the most rapidly growing sector in the hemp space is beverages.
Walk into almost any liquor store across the state, and you’ll see some kind of THC-infused seltzer. These drinks aren’t traditional cannabis-infused beverages, which make up about 1.1% of the U.S. cannabis market, according to cannabis analytics firm Headset.
Business owners in the New Jersey liquor industry are bullish on hemp-derived THC beverages. The state has seen an estimated $25 million in sales this year alone, with some predicting over $100 million in sales within a year, said Mike Halfacre, executive director of the Beer Wholesalers Association of New Jersey.
Hemp beverages make up about 10% to 15% of all sales at New Jersey liquor stores, Halfacre said — about the same as craft beer.
“There is significant consumer demand for these products, which is why our members want to carry them,” Halfacre said.
Wait, you mean my favorite THC seltzer will be illegal?
As currently written, all hemp-derived products — including beverages — would be pulled off the shelves until such time as the New Jersey Cannabis Regulatory Commission issues rules and regulations. Those regulations will likely include age restrictions and testing requirements, as well as issues like labeling, security and signage.
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