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Applications Open for New Jersey Cannabis Consumption Lounge Licenses
While recreational cannabis has been available for sale in New Jersey since April 2022, legally regulated spaces for consumption outside private residences were a distant reality—until now. The state is ready for the first cannabis consumption lounges in Jersey, with the Cannabis Regulatory Commission (CRC) already accepting applications since January 2, 2025.
The current application period, primarily allocated for social equity applicants, is about to close. But it doesn’t mean your chances for a consumption lounge license in New Jersey are over! Microbusiness and Diversely Owned cannabis businesses can begin applying on April 2, while all other Class 5 Retail Operators, including other social equity applicants, can apply starting July 2. In this guide, we discuss everything you need to know about consumption area endorsement.
What is a New Jersey Cannabis Consumption Area Endorsement?
A consumption area endorsement in New Jersey allows existing licensed dispensaries to open up indoor or outdoor spaces for consumers designated for cannabis consumption. Either licensed Class 5 retail dispensaries or an Alternative Treatment Center (“ATC”) with a dispensing endorsement can apply.
Standards for On-site Consumption Lounges In Jersey
Cannabis smoking lounges can only sell cannabis products and cater to adults 21 and older. Following the CRC regulations, dispensaries still cannot sell other products like food, alcohol, or tobacco. However, patrons may have food delivered to the consumption lounge. Smoking lounges can be indoor or outdoor. Each with strict regulations.
Indoor Lounges
Indoor lounges must be in a fully enclosed and separate area with solid walls and windows. Consumers must only access the smoking lounges through the dispensary. To ensure safety, the indoor cannabis lounge must comply with weed laws in New Jersey, including ventilation requirements outlined under the Smoke-Free Air Act.
Outdoor Lounges
Outdoor lounges must be on the dispensary premises, either connected or separated from the dispensary. To ensure cannabis adult use is not visible to the public (i.e., pedestrians), cannabis businesses must install barriers like walls or fences. Lastly, cannabis businesses must strictly implement ventilation measures to avoid smoke, vapor, or exhaled material from reaching public spaces.
Consumption Lounge License Requirements in New Jersey
License holders need to update their existing documents, including business plans if they want to secure a consumption area endorsement. Applicants for a consumption lounge license in New Jersey must submit:
- An oath that the information provided is accurate
- Municipal approval form
- Floor plans, showing the design of the indoor/outdoor cannabis lounge and the ventilation plan
- Standard operating procedures (SOPs) covering:
- Transfer of cannabis items
- Safe consumption
- Age verification and restricted access
- Destruction of leftover cannabis
- Emergency response protocols, and
- Ensuring only regulated cannabis items are consumed
Applicants must pay a $200 application fee and, if approved, an additional $800 approval fee for their social consumption area endorsement application. The annual licensing fees for consumption areas vary: $1,000 for microbusinesses and $5,000 for standard businesses.
While there is no cap to the total number of consumption areas statewide, entities possessing multiple licenses can only apply for one consumption lounge license in New Jersey and must choose the dispensary location that will accommodate it. There is also no deadline for submission of applications for consumption area endorsements. CRC will process applications as soon as they receive it.
Municipal Approval
In addition to state-level weed laws in New Jersey, the success of license applications depends on municipal and local approvals. Municipalities have the power to decide whether they want cannabis consumption lounges in their areas—so not every town will allow them. These local laws might have specific rules about where your lounge can be, when it can operate, and how far it must be from places like schools, daycare centers, playgrounds, or churches.
Applying for a consumption lounge license in New Jersey does not require a new Resolution of Support. However, a cannabis business must fill out a municipal approval form which requires pertinent information for a municipal representative to approve and sign.
Note that CRC’s municipal approval is just one step. There may still be ongoing local requirements to address. Licensed retailers should consult with local licensing committees about specific area regulations to avoid additional paperwork and delays.
If a municipality denies an application, an applicant has 30 days to request a hearing in the Superior Court where the applicant applied. The applicant must also provide a copy of the request to the designated municipal officer. The court will schedule the hearing within 30 days of the request.
Let CannDelta, New Jersey Cannabis Experts, Help You
Integrating a consumption area into your dispensary could significantly refine your business strategies, foster brand loyalty, and maintain customer engagement. With the application period for a consumption lounge license in New Jersey ongoing, now’s the ideal time to gain a competitive edge in the New Jersey market.
Should you be ready to begin your application or seek expert guidance, CannDelta is here to help. Our team has provided specialized counsel to cannabis companies in New Jersey to increase the success of their applications and refine the strategies of their business. Reach out and let’s position your business for long-term growth!
Frequently Asked Questions
How do I open a consumption lounge in New Jersey?
To open a cannabis consumption lounge in New Jersey, follow these steps:
- Secure a Class 5 Retailer or Expanded ATC license.
- Ensure the consumption lounge is at the same site as your dispensary and meets local zoning laws.
- Apply to the NJ Cannabis Regulatory Commission (NJ-CRC), including municipal approval.
- Check with the local licensing committee about specific rules for operation hours and proximity of location.
- Pay the $200 application fee, plus an $800 approval fee, if accepted. Licensing costs vary, ranging from $1000 to $5000.
- Wait for approval, as CRC will process applications as soon as they receive them.
- Once approved, ensure all operations comply with state, municipal, and local laws.
To ensure your cannabis business is in full compliance, reach out to cannabis experts for smooth navigation of license applications and business implementations.
Are cannabis consumption lounges legal in New Jersey?
Yes, cannabis consumption lounges are legal in New Jersey. Since January 2, 2025, the New Jersey Cannabis Regulatory Commission (NJ-CRC) has been accepting applications from licensed retail dispensaries that will build consumption lounges on their property. It will reopen on April 2 for microbusinesses and diversely owned businesses. And the last wave of applications, open to all cannabis businesses, will start on July 2. These highly regulated consumption spaces are only open to adults 21 and older who want to consume cannabis products. Note that some municipalities in the state have yet to permit smoking lounges within their jurisdiction.
How much does it cost to start a cannabis consumption lounge business in New Jersey?
Starting a cannabis consumption lounge in New Jersey entails expenses and fees. To secure a license, the New Jersey Cannabis Regulatory Commission (NJ-CRC) requires a $200 application fee and another $800 upon approval of the application. Once approved, license holders must pay annual license fees which cost $1,000 for microbusinesses and $5,000 for standard businesses. Besides these mandatory fees, licensed retailers must also prepare for property modification costs and other expenses for preparing the cannabis consumption lounge.
