By Anne Holland
In a nationally historic move, New Jersey’s Economic Development Authority (NJEDA) has agreed to loan a a state-licensed dispensary, the Compassionate Care Foundation of Egg Harbor Township NJ, $350,000 plus $7,200 for finance fees. To MMJ Business Daily’s knowledge, this is the first time any state development office has made a significant loan to a medical marijuana facility.
Compassionate Care Foundation CEO Bill Thomas told MMJ Business Daily that he does not foresee any problem in using a commercial bank account to receive and manage this funding. He said, “This money is from loans. Not from selling marijuana.” According to the formal project summary for the loan, the dispensary will pay an interest rate of under 5%. This stands in stark contrast to the 25% interest rate the Foundation is currently paying private investors.
Also, under the terms of the loan, the dispensary is not obligated to begin repaying capital for six months, and the first six months of interest-only payments were included in the financing. The loan runs for three years, indicating the state’s faith that medical cannabis will continue to flourish.
As Compassionate Care Foundation is in the process of producing its first crop, it will not open for business until mid-October of this year. Thomas said he intends to use the $350,000 to buy indoor gardening equipment such as lights, tables, carbon dioxide generators, nutrients and processing equipment to open a second grow room. “This will triple our production.”
Currently, the dispensary’s single grow room takes 14 weeks to produce and process product. By running two rooms at the same time, Thomas estimates he can cut production time to just five weeks.