CRC Taking 5x Longer than Regulations Prescribe to Process Conditional License Apps

With pressure increasing on the New Jersey Cannabis Regulatory Commission to issue more Conditional, Conditional Conversion and Annual Cannabis Licenses to new operators, we took a deep dive into just how long the CRC has taken, on average, to approve the nearly 800 conditional licenses issued to date.

First, it’s important to note that the CRC’s own published regulations, the “Personal Use Cannabis Rules” subchapter of the New Jersey Administrative Code (N.J.A.C. §17:30), specify how long it should take the CRC to review a Conditional License application and make a determination on approving the license, denying the license or returning the application for cure to the applicant. Specifically, N.J.A.C. §17:30-7.2(c) states:
Not more than 30 days after the receipt of a conditional license application, the Commission shall make a determination on the application.

Next, there’s enough publicly available data on license applications to pretty accurately determine how long, on average, it’s taking the CRC to review and approve Conditional License awards.

And on average, it’s taken the CRC 150 days to review and approve Conditional Licenses. (See * Methodology below).

That’s a whooping five times (5x) the timeline spelled out in the CRC’s own regulations. And this is the license type that faces none of the barriers the CRC likes to mention as preventing more businesses from operating: local approval, real estate, or large sums of capital are not needed for a conditional license. This delay is entirely on the CRC and no one else.

And keep in mind that since a Conditional License doesn’t require real estate, municipal approval, or written standard operating procedures (a.k.a. SOPs) , they don’t require that much review: Basically, a reviewer is verifying a few pieces of paperwork (diversity certificate, government IDs, some disclosure forms, one year’s tax returns), a 20 page max business plan, a one page insurance letter, and a 20 page max compliance plan. Any capable person should be able to complete such a review in a day, tops. Considering there have been ~1,300 conditional applications to date, a team of 10 reviewers getting through 1 application a day each would have gotten through all the applications in 4 months. It took the CRC well over double that time to clear their backlog of Conditional Applications, most of which were approved at the last two CRC meetings in September and October (489 of the 797 Conditional License Awards to date).

* Methodology: By analyzing the sequential Application ID numbers of each Conditional License Awardee that only get assigned once a complete application is submitted in the CRC’s application portal, and reconciling those Application IDs to the CRC data updates on the total number of Conditional applications received at specific dates, we can pretty accurately determine the original submission date of each Application ID. For example, the CRC reported that there were 150 applications submitted on 12/15/2021, the day Cultivation and Manufacturing applications were accepted, so licenses with Application ID’s 1001 to 1150 were all submitted on 12/15/2021. We also know by CRC Executive Director Recommendation Memos which Application IDs get a Conditional Award and what CRC meeting date that happens. So with the estimated submission date and the date the application was approved you can calculate just how long each Conditional License Award took to get approved, add it all up and arrive at an average.

One note: there’s no easy way to determine which of these applications might have been returned for cure, so this includes time to cure applications that required it. In an informal survey I saw of license awardees who did not have to cure their Conditional License Applications, 146 days was the average.

Here’s the backup data:

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