A new bill restricting intoxicating hemp to businesses licensed by the NJ Cannabis Regulatory Commission (NJ-CRC) passed the NJ Senate Budget and Appropriations Committee.
S 4509 was introduced by NJ Senate Majority Leader Teresa Ruiz (D-29-Essex) and Senate President Nick Scutari (D-22-Union).
Interestingly, an “intoxicating hemp product” will be distinct from a “cannabis item.”
Cannabis Lobby Eager to Restrict Intoxicating Hemp
Cannabis consultant and advocate Susanna Puntel of the American Trade Association of Hemp and Cannabis (ATACH) was for the bill. She criticized intoxicating hemp products and the shady smoke shops selling them.
A lot of dispensary owners would agree with her.
Puntel was unhappy that the Doritos knock-off in front of her had 600 mg of THC. That is a lot more than the limit of 100 mg in legal Jersey edibles.
She noted the feds have cracked down on intoxicating hemp with a bill banning it in 12 months (unless hemp lobbyists win). Puntel noted she was proud to have been part of ATACH’s efforts lobbying for the crackdown on the 2018 Farm Bill loophole.
“If there’s no action by Congress, the product in front of you have to come off the shelves?” Committee Chair Paul Sarlo (D-Bergen-36) asked.
Puntel noted federal enforcement will not begin until November 13, 2026, to help hemp farmers and ethical CBD oil makers.
In addition, NJ CannaBusiness Association (NJCBA) acting President Bill Caruso was also for the bill to bolster the adult-use cannabis market.
“This is pretty much done. Congress acted,” he said.
Caruso said intoxicating hemp Multi-State Operators (MSOs) can make deals with existing manufacturers to get their products in the NJ adult-use cannabis market. BC also said hemp farmers could get licensed to get their products into the adult-use market, along with liquor stores.
NJ Cannabis Trade Association (NJCTA) Executive Director Todd Johnson also endorsed the bill. He argued that the shady smoke shops are hurting ethical dispensary owners. Johnson also testified he did not like the liquor store carveout for them to sell intoxicating hemp seltzers
Beer brewer lobbyist Eric Orlando said he wanted his members to be able to get NJ cannabis licenses. He said other states let breweries hustle intoxicating hemp drinks.
NJ-CRC Testifies
Acting Executive Director Chris Riggs of the NJ-CRC said most of the intoxicating hemp sold in Jersey is made elsewhere.
“They appeal to the youth or have dangerously high levels of THC to them,” he noted.
Riggs said many local governments complain about it to them.
“Right now, it’s outside of our regulatory purview,” he noted.
Riggs explained that the bill will integrate intoxicating hemp products into the NJ Cannabis market.
“All intoxicating cannabinoids should be regulated the same,” he said.
Small Business Advocates Push to Protect Local Hemp
“We have been left out along the way…,” Chief Vincent Mann of the Lenape Nation and the NJ Hemp Growers Association said.
He said the NJ-CRC allows MSOs to bring their cannabis products across state lines. Mann wanted hemp businesses to be grandfathered into the cannabis industry.
Advocate Kristen Gooede of the Trichome Analytical cannabis testing lab company noted there are only 38 license holders in the NJ hemp program.
“It does throw out the baby with the wash, bathwater,” she argued about the bill.
Gooede said CBD-dominant plants that don’t get you high exceed their strict THC limits. She wanted them to create a pathway for NJ hemp manufacturers and farmers for CBD into the cannabis market with fewer barriers to entry.
Baked by the River dispensary CEO Jesse Marie Villars opposed the bill for hurting local hemp businesses in general. However, she did like that it addresses shady actors.
Local Hemp Farmer Concerns Legislators
Thomas Norcia of Grow Works said hemp growers were never allowed in the intoxicating hemp market in Jersey. He said a lot of intoxicating hemp is from China.
“We are for the psychoactive hemp ban. But not at the expense of farmers,” Norcia explained.
He said his town doesn’t like cannabis farmers or makers. So he would not be able to get a proper cannabis license under the bill.
“This bill doesn’t impact you, as is? But you’re concerned about the future?” PSarlo asked.
Norcia said he didn’t see protection for hemp farmers in the bill.
“I think it’s outside of this bill…,” Sarlo said. “You make a very valid point sir.”
He noted that an Assembly bill version is forthcoming. He noted the need to monitor federal issues and help local farmers.
Ruiz noted many have been unhappy about this for some time. She argued the bill wouldn’t hurt hemp farmers. She said they’re in touch with the NJ Farm Bureau.
“Everything is through interstate commerce,” Ruiz argued before the bill passed the committee.
Future Intoxicating Hemp License Rules by CRC
If the bill passes, the NJ-CRC is going to establish new intoxicating hemp licensing and sales rules.
Notably, “no business will be allowed to sell an intoxicating hemp product that is not accompanied by a certificate of analysis issued within the previous six-month period by a laboratory in compliance with CRC testing standards.”
Also, “no person or entity shall dispense, distribute, sell, or offer for sale an intoxicating hemp product, including an intoxicating hemp beverage, from a vending machine.”
Furthermore, the bill prohibits direct consumer sales and online sales of intoxicating hemp products.
Any employees of such licensees are also required to participate in the education program developed and implemented by the Cannabis Regulatory Commission.
New Hemp Drink Sales License
So, the law mandates the NJ-CRC create a license for liquor stores to sell hemp drinks as a carveout to Big Booze and the many hemp drink hustlers in the market.
Any holder of a “plenary wholesale or plenary retail distribution license” from the Division of Alcoholic Beverage Control (ABC) that sells intoxicating hemp beverages may do so until the NJ-CRC adopts new rules.
Within 120 days following the new rules release, hemp drink makers and sellers must stop selling their drinks. They will be allowed to continue to do so “only upon approval by the commission.”
Hemp seltzers seem to be popular with casual consumers and the canna-curious versus passionate stoners and potheads.
New Intoxicating Hemp Taxes
There would be new town and state taxes to accompany the new legal classification of products and businesses. According to the bill, 50 percent of all revenue generated from such tax is deposited into the CREAMMA Fund. The other half is supposed to go into a special “nonlapsing” account.
The bill imposes a $30 excise fee on the transfer of intoxicating hemp products.
There will be an excise tax of $5.50 per gallon on the sale of intoxicating hemp beverages.
“The per-gallon tax and $30 excise fee imposed on intoxicating hemp products is intended to fund social equity programs,” the bill claims.
What will happen with such financial accounts in the state known for Boardwalk Empire and The Sopranos remains to be seen.
State Commerce and NJ Intoxicating Hemp Lawsuit
The rules permit out-of-state people and companies to obtain a local license. Or they must meet product and safety standards that the NJ-CRC allows.
The bill notes it wants to address issues raised by a pro-hemp lawsuit filed last October 2024. It was launched after a similar intoxicating hemp bill was signed into law. So it led to the case in the U.S. District Court for the District of New Jersey, “Loki Brands, LLC et al. v. Matthew Platkin et al.”
Notably, the law says that “nothing in this bill, nor the Intoxicating Hemp Act, prohibits the transportation or shipment of hemp or hemp products through the State.”
The court found the old law violated the Dormant Commerce Clause of the United States Constitution.
The lawsuit held the NJ-CRC up from pushing changes.
