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Feb. 20, 2023 A change to the massive recreational marijuana bill in the Minnesota House was meant to soften objections by the state’s cities and counties.It hasn’t. At least not yet.The change would allow cities and counties to have dual licensing powers over retailers of cannabis products within their jurisdiction. While locals would have to issue licenses to any retailer licensed by the state, they could use their local license to enforce state rules on sales.Cities and counties could also charge a ...
Feb. 20, 2023
A change to the massive recreational marijuana bill in the Minnesota House was meant to soften objections by the state’s cities and counties.
It hasn’t. At least not yet.
The change would allow cities and counties to have dual licensing powers over retailers of cannabis products within their jurisdiction. While locals would have to issue licenses to any retailer licensed by the state, they could use their local license to enforce state rules on sales.
Cities and counties could also charge a small license fee — no more than $200 — that would be charged on top of the state’s $250 license fee. And their co-jurisdiction would not apply to growing or manufacturing businesses located within city or county boundaries.
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“The state does the lion’s share of the work on this,” Rep. Zack Stephenson, DFL-Coon Rapids, said of his legalization bill, House File 100. “The local jurisdiction has no discretion. If the state grants a license, the local unit of government must also issue a license.”
“They are better situated to do the enforcement,” he said of the cities and counties. “Because you need both licenses, if a local unit of government catches a retailer selling to kids or selling products that are not approved (by the state) they can yank the license and shut down the store.”
Only public-facing licensees would need local licenses under the new language — cannabis retailers, cannabis microbusinesses that can both grow cannabis in small quantities and sell to customers, low-potency hemp-based edibles retailers and medical cannabis retailers.
The amendment also makes a major change to enforcement of state laws on marijuana. Not only can cities and counties license these new stores and enforce laws, in several areas they are required to lead on enforcement. They must do compliance checks, they must do checks on age verification rules, they must conduct stings to assure no minors are buying products, and they must do inspections at least once a year.
Locals are allowed to fine retailers up to $2,000 for each violation.
“His amendment is basically a way to say, here are some teeth for local governments to say we’ll have a quasi license and you can be temporarily suspended until the state can deal with it,” said Matt Hilgart, a lobbyist for the Association of Minnesota Counties.
But they can’t, as city and county lobbyists have requested, completely opt out of retail sales. As of now, there is no clarity whether they can enforce general zoning ordinances or limit the number of stores in any area of cities or counties. This is especially an issue in border towns that might have customers try to make purchases from neighboring states.
The bill does have restrictions on location stores near schools, parks and playgrounds. But those are put in play when the state considers licenses, though cities and counties can comment on license applications.
The reluctance to give cities and counties too much authority and any licensing is based on a basic premise by sponsors: Too much burden on new cannabis businesses could increase costs and put them at an economic disadvantage to illegal sellers.
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“It’s a battle right now,” said Hilgart. “The skepticism that too much local government involvement will deter businesses from setting up shop and potentially create an illicit market and us saying we don’t think that is founded.”
The law changes by Stephenson do allow cities and counties to pull licenses and close stores. But those decisions must be quickly reviewed by the state, which can reverse those decisions or change punishments.
While they support the changes, lobbyists for the state cities and counties associations say they are not enough.
“We see the amendment as a step in the right direction,” said Alex Hassel, a lobbyist for the League of Minnesota Cities. The local registration is similar to what is now required of other retailers and gives cities a way of knowing which stores are properly registered and which might be illegal pop-ups. But the ultimate authority over who is licensed, how many stores are licensed and where they locate is with the state, not the cities.
The cities also appreciate the authority to do compliance checks, having testified at committee hearings that residents expect city officials to respond to complaints about businesses acting illegally. But the requirements in the amendment add to city to-do lists and will bring extra costs that aren’t covered by license fees.
“That’s a big lift for local governments,” Hassel said.
Hilgart said the amendments only respond to some of the concerns raised. The counties have been pushing for local control, a strong state regulatory framework and “some recognition of local government costs.”
The counties agree with the premise that the new businesses should have relatively low licensing and taxation costs to compete with illegal sellers. So rather than have additional taxes at the local level as happens in some other states, the counties are proposing appropriations from the state.
“We’re paying for all of our state agencies in this bill,” he said, referring to appropriations for the new Office of Cannabis Management along with money for the departments of agriculture, economic development, public safety, corrections and others.
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He wants the bill to recognize local costs and provide perhaps two to four percent of the revenue from a proposed 8% excise tax to cities and counties.
If Stephenson — along with the lead Senate sponsor Sen. Lindsey Port, DFL-Burnsville — are not interested in local government opt outs, “will you at least let us exhibit our local zoning authorities to their full capacity and have some kind of reasonable limitation on license numbers?” Hilgart asked.
Driving Route 17 between Route 80 and Route 4 can be described in two words, nasty and frustrating. It’s a busy section between Maywood and Paramus that maddeningly narrows to two lanes in each direction.One driver described it as a “nightmare parade of brake lights in both directions, 24/7.” A fix for this section of Route 17 had been studied and discussed before ...
Driving Route 17 between Route 80 and Route 4 can be described in two words, nasty and frustrating. It’s a busy section between Maywood and Paramus that maddeningly narrows to two lanes in each direction.
One driver described it as a “nightmare parade of brake lights in both directions, 24/7.” A fix for this section of Route 17 had been studied and discussed before going dormant for more than a decade.
But the 2023 state budget is breathing life into the longstanding proposals to eliminate the bottlenecks.
“Route 17 goes from four to two lanes and goes through this heavily congested area and then goes back to four lanes,” said Thomas J. Duch, Bergen County administrator. “It should have been done a long time ago.”
The multi-year project is going to start on a local road that parallels Route 17 by preparing it to handle expected detouring traffic when construction starts.
The bigger state project would eliminate a bottleneck caused by three 1930s era narrow bridges, said Steve Schapiro, a N.J. Department of Transportation spokesperson. Two of the narrow bridges take the highway over train tracks and another over a local street, he said.
The larger “Route 17 Bottleneck Alignment Alternate 3A” is a separate safety improvement and congestion relief project to widen nearly 2 miles of Route 17 in Maywood, Rochelle Park and Paramus and replace three bridges, Schapiro said.
How bad is it?
This 2-mile section of Route 17 is the only piece of highway that isn’t considered an interstate part of the national freight system, even though it physically goes to New York state, said Joseph Baladi, division head - planning of the Bergen County Department of Planning & Engineering.
“We don’t want to put a Band-Aid on the bridges. A lot of tractor-trailers use this (highway) to go up to I-287,” he said. “We get all these 18-wheelers and heavy trucks going through this narrow section.”
That section of Route 17 also has poor visibility and lacks highway shoulders. NJDOT traffic volume figures for 2018 said more than 118,000 vehicles a day travel that part of the highway.
“The county sought a $10 million allocation in the governor’s budget to address the central arteries parallel to the Route 17 bottleneck,” Duch said. “The funding will be used to enhance public safety before construction to expand Route 17.”
That work will widen intersections and add turning lanes at four Rochelle Avenue intersections with Main and Essex streets in Lodi, Market Street in Saddle Brook and Central Avenue in Rochelle Park, Baladi said. The county studied and came up with concept plans funded with a $850,000 North Jersey Transportation Planning Authority grant, Duch said.
Bergen County completed its Local Concept Development Study in 2015, which makes it eligible for federal funds for future work, said Melissa Hayes, an NJTPA spokeswoman. The current state Transportation Improvement Program has a total of $16 million allocated for the local project and projects construction to start in 2025.
An exact start date depends on completing final designs and county officials are working with municipal officials.
The work on Rochelle Avenue will also alleviate traffic problems that happen now when there’s a problem on Route 17, Duch said
“If there’s an accident, traffic diverts (from Route 17) to the local roads, it’s become a problem,” he said. “Rochelle Avenue is the only one that parallels Route 17.”
Bergen County is conducting the concept development phase of the widening portion of the project which is expected to completed in spring 2023, Schapiro said. That study is investigating how to widen Route 17 from two lanes to three lanes and add shoulders in each direction, Schapiro said.
Once that phase is completed, NJDOT will take over and the project will move into Preliminary Engineering, which has $3.5 million budgeted for the work, he said.
Preliminary Engineering is expected to take approximately two years when the project advances to final design. Construction is expected to begin in Fiscal Year 2028 at an estimated construction cost is $97 million, Schapiro said.
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TENAFLY, New Jersey (WABC) -- Eyewitness News spoke to a few parents whose children attend Midland School - the elementary school where Jeffrey Grossman, 65, taught and his son, Steven Grossman, 24, was a substitute teacher. Parents found out Thursday that father and son were arrested - accused of viewing, downloading, and possessing child pornography.Parents say the elder Grossman accompanied their children on a trip to Washington D.C. back in May."And he confiscated their phones every night. So my fear now was he's looki...
TENAFLY, New Jersey (WABC) -- Eyewitness News spoke to a few parents whose children attend Midland School - the elementary school where Jeffrey Grossman, 65, taught and his son, Steven Grossman, 24, was a substitute teacher. Parents found out Thursday that father and son were arrested - accused of viewing, downloading, and possessing child pornography.
Parents say the elder Grossman accompanied their children on a trip to Washington D.C. back in May.
"And he confiscated their phones every night. So my fear now was he's looking at my kids' pictures - my girls in their bikinis at that young age," said Julie Agatone.
Parents are livid, wanting to know more about the timeline of the investigation by the Bergen County Prosecutors Office. Specifically, they want to know whether the Grossmans were allowed to be around children while investigators were looking into their internet activities.
Besides teaching, Jeffrey Grossman serves as Borough Council President in Tenafly where records say both men live on Downey Drive.
Tenafly Mayor Mark Zinna released a statement that says in part, "I think it is in the best interest of the borough that Mr. Grossman steps down in order that the people's business can continue uninterrupted and without distraction."
Part of a statement from the superintendent to parents in the Rochelle Park school district says of the Grossmans, "They are prohibited from coming to the school for any reason and are prohibited from contacting any student or staff."
Parents say they have plenty of questions for the next school board meeting next week.
Both men appeared before a judge on Friday afternoon. The attorney for the elder Grossman entered a plea of not guilty on his behalf. No plea was entered for his son.
They are due back in court next week.
LAWRENCE — It seemed too good to be true.Lawrence Township Manager Kevin Nerwinski didn't believe the numbers he was seeing. Verano Holdings wanted approval to open up its Zen Leaf medical marijuana dispensary in the town to recreational customers, selling legal weed to anyone over 21 years old. The company expected millions in revenue per month and, with a 2% transfer tax on every sale, a huge windfall for the township.In the first year or two, Verano told Nerwinski that the township could see as much as $...
LAWRENCE — It seemed too good to be true.
Lawrence Township Manager Kevin Nerwinski didn't believe the numbers he was seeing. Verano Holdings wanted approval to open up its Zen Leaf medical marijuana dispensary in the town to recreational customers, selling legal weed to anyone over 21 years old. The company expected millions in revenue per month and, with a 2% transfer tax on every sale, a huge windfall for the township.
In the first year or two, Verano told Nerwinski that the township could see as much as $1 million in tax revenue.
"The numbers seemed eye-popping," Nerwinski said. "And then, on Day One, there were lines around the building. And it continued for weeks and weeks and weeks."
As the New Jersey cannabis industry enters its second year of recreational marijuana sales, municipalities are beginning to reap the tax benefits promised to officials when they signed up to become first in line. While the revenues are not budget saviors for any and likely will decrease with time and competition, town officials say it’s driving real impact.
More than $4.6 million was collected in cannabis tax revenue in 10 of the 12 municipalities where adult-use sales began in April 2022, according to a USA TODAY NETWORK analysis of municipal budgets and interviews with municipal officials. The impact in those municipalities is varied, often depending on the size of the municipality: In small towns, cannabis tax revenue can pay for new firefighters. In bigger cities, it's simply a way of keeping costs down.
Complete tax figures were not available in three municipalities — Deptford, Egg Harbor and Paterson, where cannabis tax revenue wasn’t listed as a budget line item and municipal officials did not return multiple requests for clarification and comment.
"It's about trying to maintain a stable tax base, particularly when the cost of everything is going up," said Mike Cerra, executive director of the New Jersey League of Municipalities. "A lot of towns want to reinvest any excess revenue into their community, in terms of upgrades and infrastructure, creating more sufficient parking, making their downtowns more walkable."
Municipal officials in towns with cannabis businesses are happy to take the extra revenue, even if it's not a jackpot, Cerra said.
"I don't think anyone went into this thinking it would be a game-changer," Cerra said. "But 2% sure is better than 0%."
There are currently 35 dispensaries selling cannabis to recreational customers. Though recreational marijuana sales are now occurring in dozens of other municipalities, the Network only analyzed those municipalities where sales began on April 21, 2022, the day New Jersey officially opened its adult-use cannabis market.
According to the New Jersey Cannabis Regulatory Commission, the state itself only collected about $20.1 million in cannabis taxes last year. The state levies two taxes on cannabis — the standard 6.625% sales tax and a social equity excise fee, which is levied on cannabis cultivators and wholesalers but earmarked for disbursement to communities most impacted by the War on Drugs.
On average, municipalities analyzed by the Network collected about $465,000 in cannabis tax revenue last year, but the range goes from about $191,000 in Monroe Township in Gloucester County, from a Botanist dispensary in the Williamstown area, to more than $1 million in Bellmawr in Camden County, home of a Curaleaf dispensary.
But just how far that cannabis tax revenue will stretch is almost directly linked to the size of a municipality or, at least, its annual budget.
Bloomfield officials are anticipating $483,250 from the local RISE dispensary this year — only about 0.5% of its $99 million budget and 0.8% of its $64 million tax levy.
But in Rochelle Park, the anticipated $480,000 collected from its Ascend dispensary accounts for more than 3% of its $14.8 million budget and nearly 5% of its $10 million tax levy.
"It's been helpful in keeping taxes low, in offsetting costs. And there hasn't been a strain on any of our services," Rochelle Park administrator Dean Pinto said. "The revenue has remained constant. It's been pretty impactful, more than we thought it would be."
The clearest success story is Bellmawr, a small borough of less than 12,000 people where Curaleaf opened its first New Jersey medical marijuana dispensary in October 2015. When it began adult-use sales last year, municipal officials expected a boom, inserting a line item anticipating $659,000 in tax revenue into its 2022 budget.
But when the dust settled, the tax revenue blew past those projections and eventually topped $1 million – about 6% of the municipal budget and nearly 11% of its tax levy.
The cannabis cash went a long way, Bellmawr Mayor Charles Sauter III said. The borough used the cannabis tax revenue to create a stipend program for volunteer firefighters, encouraging more sign-ups, and to increase salaries for its EMS department. The borough spent more than double its 2022 figures on salaries and wages for firefighters, according to budget documents, and nearly $150,000 more on EMS salaries.
There are similar stories across New Jersey. In Rochelle Park, cannabis taxes totaled nearly $550,000, four times what the township collected in municipal court fines in 2022, according to the town's 2022 budget.
“I don’t think I expected we’d be in the position we’re in now, but it’s what we hoped for,” Pinto said.
Lawrence Township budgeted $450,000 for cannabis taxes in 2023, the same as it collected in 2022. But Nerwinski said that estimate is conservative: The township expects to collect about $900,000 in cannabis taxes this year, about what Nerwinski expects the township to spend on trash collection.
"It's a game changer when you're annually struggling to put together a budget that limits tax increases but preserves services," Nerwinski said. "We look back at the decision to be one of the first municipalities to take this on, to do it in a meaningful way but in baby steps, and we're really happy we did it."
But municipal officials aren’t taking the new influx of cash for granted.
The New Jersey cannabis industry is still in its early stages, with the number of cannabis businesses already ballooning, from 12 dispensaries with recreational sales in April 2022 to 35 dispensaries as of July 2023. And there’s more on the way: To date, the New Jersey Cannabis Regulatory Commission has issued nearly 800 licenses to dispensary applicants.
The rapid expansion of the cannabis industry means competition – a win for consumers, turned off by some of the country’s most expensive cannabis prices (despite some of its lowest taxes), but a potential loss for municipalities expecting tax revenues.
While the New Jersey marijuana legalization laws give regulators the ability to increase the social equity fee to ensure tax dollars are flowing even when prices fall, there’s no such mechanism for the 2% transfer tax levied by municipalities.
Last April, the Zen Leaf store in Lawrence was the only dispensary selling adult-use cannabis in a 20-mile radius. Today, it's one of nine adult-use dispensaries — with a 10th on the way. Customers who might have traveled all the way to Lawrence may instead opt for Union Chill in Lambertville, Bloc Dispensary in Ewing or Curaleaf locations in Bordentown Township and Edgewater Park.
“Every year, there's going to be more retailers coming on board and we're going to see that revenue decrease," Nerwinski said. "So we're happy to have been one of the first to get the full fruits of cannabis retail."
In short: Cheaper weed means less tax dollars, and municipalities have to plan ahead. That means putting at least some of the cannabis revenue into surplus and not letting budget projections stray too far from actual realized dollars, Pinto said.“We can try to keep looking forward,” he said, “but we always have to keep in the back of our minds that this may not last forever.”
Mike Davis has spent the last decade covering New Jersey local news, marijuana legalization, transportation and a little bit of everything else. He's won a few awards that make his parents very proud. Contact him at [email protected] or @byMikeDavis on Twitter.
ROCHELLE PARK, N.J. — Locally based developer Tulfra Real Estate has begun leasing The Delford at Village Center, a 160-unit apartment complex in the Northern New Jersey community of Rochelle Park. The site is adjacent to Westfield Garden State Plaza Mall. The six-story building houses one- and two-bedroom units and amenities such as a pool, fitness center, coworking lounge and outdoor grilling and dining areas. Full completion is slated for March. Rents start at $2,400 per month for a one-bedroom apartment.ShareNEW YORK ...
ROCHELLE PARK, N.J. — Locally based developer Tulfra Real Estate has begun leasing The Delford at Village Center, a 160-unit apartment complex in the Northern New Jersey community of Rochelle Park. The site is adjacent to Westfield Garden State Plaza Mall. The six-story building houses one- and two-bedroom units and amenities such as a pool, fitness center, coworking lounge and outdoor grilling and dining areas. Full completion is slated for March. Rents start at $2,400 per month for a one-bedroom apartment.
NEW YORK CITY — Dallas-based JSC Realty & Investment Services has purchased a multifamily development site in Brooklyn’s Boerum Hill neighborhood with plans to construct a 154-unit project. The 113,000-square-foot site at 540 Atlantic Ave. currently houses a five-story office building that was originally constructed in 1924 and will be demolished. Stephen Palmese, Brendan Maddigan, Michael Mazzara, Ethan Stanton and Winfield Clifford of JLL represented the seller, locally based firm DMA Associates, in the land sale. A construction timeline for the project was not disclosed.
NEW YORK CITY — Marcus & Millichap has brokered the $48 million sale of Fannwood Estates, a 312-unit apartment complex in Queens. The six-story, rent-stabilized building occupies a full city block within the borough’s Rego Park neighborhood. Shaun Riney, Seth Glasser, Joe Koicim, Louis Zarif and Sean Fopeano of Marcus & Millichap represented the seller and procured the buyer in the transaction. Both parties were private investors that requested anonymity.
SCOTTSDALE, ARIZ. — CBRE has brokered the sale of a restaurant property located at 3748 N. Scottsdale Road in Old Town Scottsdale. Scottsdale-based The Shipp Family purchased the building from a private individual investor for $3.6 million.
Good Life Sports Bar and Grill signed a 10-year, triple-net lease to occupy the 5,265-square-foot property, which another restaurant formerly occupied. This location will be the Omaha, Nebraska-based chain’s first location in Arizona.
Built in 1957, the two-tenant building is currently being renovated for the new tenant that is slated to open next year.
Joe Campagno and Benjamin Farthing of CBRE negotiated the transaction.
PALM DESERT, CALIF. — Hanley Investment Group Real Estate Advisors has arranged the sale of a multi-tenant retail property located at 39575 Washington St. in Palm Desert. A Los Angeles-based private investor sold the asset to a San Diego-based private 1031 exchange investor for $3.9 million.
Bill Asher and Jeff Lefko of Hanley Investment Group represented the seller, while Omar Hussein of Del Mar-based Beacon Realty Advisors represented the buyer in the deal.
Built in 2008, the 8,500-square-foot retail property offers four tenant suites. At the time of sale, the property was fully occupied by Chipotle Mexican Grill (under a new 10-year, triple-net, corporate lease), Cornerstone Pharmacy, Luxury Nails & Spa and Keller Williams Realty Coachella Valley | Jelmberg Team.