Lawmakers look for new ways to regulate hemp, delta-8 products flooding New Jersey

A “dispensary” sign flashes in the window of a store that sells delta-8, hemp and CBD products. (Sophie Nieto-Munoz | New Jersey Monitor)

Stores that look like dispensaries are setting up shop in towns across New Jersey, putting CBD lotion, delta-8 gummies, and hemp products on their shelves without facing the same regulations and oversight as legal cannabis dispensaries.

Now lawmakers are weighing whether those retailers should be required to get certain licensing and if the state’s Cannabis Regulatory Commission should oversee hemp products. A new bill would regulate the production and sale of “intoxicating hemp products” that include less than 0.5 milligrams of THC — the chemical that gets someone high — per serving.

Under the bill, hemp products would only be sold in licensed dispensaries alongside cannabis products. It would also amend the New Jersey Hemp Farming Act to set limits on how much THC can be sold in hemp products, a cap that some critics say is far too low.

“The main intent I think we would all agree to is that there is a phenomenal amount of unregulated, unlicensed, untested cannabis products on gas station shelves, convenience store shelves, and they don’t go through any regulated process. Teens have access to this, and this bill attempts to capture that to prevent that,” said Scott Rudder of the New Jersey CannaBusiness Association.

The bill calls for the cannabis agency to regulate the sale of all hemp and cannabis products, and put new regulations in place for retailers. The Department of Agriculture would continue regulating the cultivation of hemp, and the Attorney General’s Office would enforce the law against those selling hemp items without a license, similar to cannabis.

A 2018 bill passed in Congress opened the door for smoke shops to legally sell hemp products like delta-8, CBD, and CBN. No license is required to sell these products, and they aren’t approved by federal or state agencies.

They do not get consumers high in the way that marijuana with delta-9 THC does. But, with little regulation and easy access, delta-8 may be sold in high quantities to children, which led the Food and Drug Administration to issue a warning about the drug in 2022. It noted more than 2,300 delta-8 exposure cases were reported during the 14 months starting on Jan. 1, 2021. Symptoms of delta-8 exposure can include dizziness, vomiting, difficulty walking, confusion, and difficulty breathing.

The New Jersey bill advanced out of the Senate Judiciary Committee Thursday after nearly an hour of testimony by a 6-2 vote, with Republican Sens. Jon Bramnick and Kristin Corrado voting no. While most people testifying Thursday were supportive of the bill’s goal, they differed over the details.

The bill received criticism from some alcohol wholesalers because it would bar liquor stores from selling low-dose hemp drinks and camp the amount of THC in these drinks to 2.5 mg. (Photo by Rebecca Rivas)

Brewery owners and liquor industry representatives opposed any move that would bar them from selling low-dose hemp drinks. Eric Orlando, of the Brewers Guild of New Jersey, suggested allowing alcohol licensees to also apply for a type of cannabis license allowing them to manufacture or sell hemp beverages.

“We’re not opposed to regulating these products, but we think we should afford local manufacturers the ability to produce and sell these beverages,” he said.

Dispensaries have strict zoning and site approval plans, and may not be prepared to store and sell these products, said Michael Halfacre, executive director of the Beer Wholesalers Association of New Jersey. Beverage distributors that have been in the game already have warehouses and refrigerators designed to carry them, he said.

Halfacre believes there’s a better marketplace for these drinks in liquor stores. He noted that in California, where THC drinks are sold in dispensaries, they account for less than 1% of sales.

Hemp drinks should be regulated by the state’s Division of Alcoholic Beverage Control, he added.

“These products are packaged like beer. They’re shipped, delivered, and stored like beer. They’re intoxicating like beer and are marketed and sold in many other states like beer. There is no reason to treat them radically different here in New Jersey,” Halfacre said.

Cantrip CEO Adam Terry said he founded his cannabis-infused beverage company as an alternative to alcohol and for curious cannabis consumers. His product is available in several states that allow hemp sales, and he wants to bring it to New Jersey but said that wouldn’t be viable under the current legislation.

He said in Minnesota he worked with officials to allow adult THC beverages to be sold at liquor stores. Hemp drinks pay an additional tax, bringing extra revenue into the state, he said. The bill as written is “misaligned with industry and national best practices,” he said.

“Cantrip agrees with the need to offer hemp-derived products to the adult population in New Jersey in a well-regulated, consistent, and safe manner,” he said.

Other critics said the bill’s cap of 2.5 milligrams is so minuscule, most people won’t even feel the effects. New Jersey’s cannabis law currently limits drinks to 5 milligrams of THC, though very few, if any, cannabis drinks are available in dispensaries.

“We’re talking about a 12-ounce can that might have 5 milligrams of THC. You’d have to drink 30 of these cans to equal what it is in a joint,” said Joe Grabowski, owner of Sarene Craft Beer Distributors.

The bill still faces the Senate Budget Committee before heading to the Senate floor. 

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