Establishes additional requirements for cannabis testing laboratories and penalties for testing violations.

A1291

ASSEMBLY, No. 1291

STATE OF NEW JERSEY

222nd LEGISLATURE

�

PRE-FILED FOR INTRODUCTION IN THE 2026 SESSION

Sponsored by:

Assemblyman MICHAEL INGANAMORT

District 24 (Morris, Sussex and Warren)

Assemblyman ROY FREIMAN

District 16 (Hunterdon, Mercer, Middlesex and Somerset)

Assemblyman CODY D. MILLER

District 4 (Atlantic, Camden and Gloucester)

SYNOPSIS

���� Establishes additional requirements for cannabis
testing laboratories and penalties for testing violations.

CURRENT VERSION OF TEXT

���� Introduced Pending Technical Review by Legislative
Counsel.

��

An Act
concerning the Cannabis Regulatory Commission and
laboratory testing of cannabis items, and supplementing Title 24 of the Revised
Statutes.

����
Be It
Enacted
by the Senate and General Assembly of
the State of New Jersey:

���� 1.� a.� The Cannabis
Regulatory Commission shall establish laboratory testing standards to improve
testing accuracy, consistency in testing, and quality control across the
medical and adult-use cannabis markets.� Any cannabis testing facility, as such
term is defined in section 3 of P.L.2021, c.16 (C.24:6I-33), shall be subject
to the standards adopted by the commission.

���� b.��� The commission shall, in
accordance with the �Administrative Procedure Act,� P.L.1968, c.410 (C.52:14B-1
et seq.), adopt rules and regulations to effectuate the provisions of this
section as follows:

���� (1)� requirements for cannabis
testing facilities that ensure consistent and scientifically sound testing
practices;

���� (2)� a framework for cannabis
testing facilities to have systems for planning and assessing work performed by
the laboratory;

���� (3)� procedures for quality
assurance and quality control; and

���� (4)� proficiency standards and
validation criteria that cannabis testing facilities shall be required to meet
and maintain in order to obtain licensure to operate pursuant to P.L.2021, c.16
(C.24:6I-31 et seq.).

���� c.� Any method for testing of
cannabis items developed by a cannabis testing facility shall meet validation
criteria set by the commission and have the results of the validation study be
approved by the commission pursuant to section 2 of P.L.��� , c.���� (C.�������
) (pending before the Legislature as this bill).

���� 2.��� a.�������� The Cannabis
Regulatory Commission shall employ the services of one or more microbiologists
and one or more chemists with experience in testing cannabis for the purpose of
conducting audits of cannabis testing facilities licensed in accordance with
P.L.2021, c.16 (C.24:6I-31 et seq.).�

���� b.��� (1)� Such individuals
employed pursuant to subsection a. of this section shall assist the commission
in conducting onsite assessments of licensed testing facilities to ensure
compliance with any applicable laws and rules and regulations related to the testing
of cannabis items by license testing facilities.

���� (2)�� Such individuals
employed pursuant to subsection a. of this section may submit recommendations
to the commission related to changes to testing standards, which the commission
shall consider in establishing any testing guidance for license testing facilities.

���� c.� A cannabis testing
facility shall submit, for purposes of approval, the following information:

���� (1)� a cover letter;

���� (2)� a summary of study
design;

���� (3)� a summary of results from
extraction and preparation method, if applicable, and determinative method and
comparison of results to the approved extraction and preparation method, if
applicable, and determinative method;

���� (4)� the standard operating
procedure or method developed by the cannabis testing facility, including any
extraction and preparation method utilized;

���� (5)� the initial demonstration
of capability, including a summary data and bench sheets;

���� (6)� a limit of detection
study;

���� (7)� the proficiency test
scores if offered from an International Organization for Standardization ISO
17025 approved provider, and all ISO 17025 assessment reports, corrective
actions, and impact analyses including analyses concerning the implementation
of corrective actions;

���� (8)� a certificate of analysis
template; and

���� (9)� any other information the
commission deems necessary for validation.

���� 3.��� a.� In addition to any
commission rules related to internal auditing, the commission shall establish
and implement an external audit program to evaluate cannabis testing facilities
licensed by the commission in accordance with P.L.2021, c.16 (C.24:6I-31 et
al.) operating within the State.

���� b.��� The program shall
include:

���� (1) red flag identification,
using statistical tools to detect patterns that indicate outliers, anomalies,
or manipulation in testing results;

���� (2)� compliance with standard
testing methods, including whether testing methods were verified in accordance
with section 1 of P.L.��� , c.���� (C.������� ) (pending before the Legislature
as this bill); and

���� (3) statistical analysis,
audit findings, employee interviews, remote monitoring, review of camera
footage, review of operational data of instruments, and inventory of records.

���� c.���� The commission, or an
independent auditor designated by the commission, shall be authorized to:

���� (1)� access the premises of
any cannabis testing facility;

���� (2)� obtain copies of records,
instrument data, and other materials necessary to conduct a proper audit;

���� (3)� conduct testing of
product samples; and

���� (4)� actively monitor testing
of retained product samples at any cannabis testing facility.

���� d.��� The commission may by
its own action, or upon the recommendation of the independent auditor, require
the recall of any cannabis product or temporarily pause the sale or
distribution of any cannabis product where an audit raises any questions of
contamination, fraud, or significant noncompliance.

���� e.���� If the audit reveals
contamination levels in a product exceeding commission rules, such findings
shall be made public with a summary explanation of the cause.� If the audit
reveals inaccurate, noncompliant, or fraudulent testing, the commission may
initiate enforcement actions against the cannabis testing facility in
accordance with commission rules.

���� 4.��� a.� The Cannabis
Regulatory Commission shall establish and administer a secret shopper program
to evaluate compliance with any law and rules and regulations by entities
licensed in accordance with P.L.2021, c.16 (c.24:6I-31 et seq.).

���� b.��� Such program shall:

���� (1)� conduct anonymous
compliance checks on licensed cannabis facilities;

���� (2)� report compliance with
packaging and labeling requirements;

���� (3)� ensure compliance with
age verification and point-of-sale requirements;

���� (4)� collect product samples
for commission laboratory analysis;

���� (5)� identify any shortcomings
in the cannabis market related to public health and consumer safety; and

���� (6)� make all results publicly
available.

���� c.���� (1)� The commission
shall contract with or designate trained individuals to carry out the program
activities.� The commission shall determine the number of individuals that are
sufficient to administer the program.

���� (2)� Such individuals are
authorized to purchase cannabis products from a licensed retail facility,
document the transaction, and submit purchased products to licensed testing
facilities for independent analysis.

���� d.��� As a result of any
information collected pursuant to this section, the commission shall take
appropriate disciplinary or corrective action against any licensed facility
found to be in violation of P.L.2021, c.16 (C.24:6I-31 et seq.) or any
applicable rules and regulations.

���� e. The commission shall, in
accordance with the �Administrative Procedure Act,� P.L.1968, c.410 (C.52:14B-1
et seq.). adopt rules and regulations as necessary to implement this section.

���� 5.��� a.� A cannabis retail
facility licensed in accordance with P.L.2021, c.16 (C.24:6I-31 et seq.) shall
maintain accurate documentation of Certificates of Analysis for each cannabis
item offered for sale to consumers.� Such documentation shall be reported to
and made publicly available by the Cannabis Regulatory Commission on its
Internet website.� Such documentation shall also be made available to
purchasers upon request.� A licensed retail facility shall conspicuously
display a notice of a purchaser�s right to request such documentation.

���� b.��� The Cannabis Regulatory
Commission shall ensure that all cannabis test results submitted to the
agency�s seed-to-sale tracking system by licensed cannabis testing facilities
are published on the Cannabis Regulatory Commission�s website no later than
three months after the date on which test results were submitted.

���� c.� Testing data published in
accordance with subsection b. of this section must include, at minimum,
cannabinoid results, contaminant screening results, sample collection date,
result submission date, product type, product identifier, batch identifier, lab
that performed the testing, licensed cultivator, licensed cannabis business
submitting the product for testing, and any notes submitted by the laboratory.

���� 6.��� a. As used in this
section:

���� �Retaliatory action� means the
discharge, suspension, or demotion of an employee, or other adverse employment
action taken against an employee in the terms and conditions of employment.

���� b.��� The commission shall
establish and maintain on its Internet website a whistleblower access and
assistance program related to cannabis businesses licensed and regulated
pursuant to P.L.2021, c.16 (C.24:6I-31 et seq.).

���� c.���� Such program shall
offer a toll-free telephone hotline and a secure online portal for the
submission of whistleblower complaints.� Such program shall be accessible to
employees and contractors of licensed cannabis businesses.� The commission
shall ensure that any individual may opt to submit a complaint anonymously.

���� d.��� The commission shall
properly investigate and audit any licensed cannabis business who is the
subject of a whistleblower complaint.

���� e.���� An employer shall not
take any retaliatory action against an employee because the employee discloses,
or threatens to disclose to the commission an activity, policy, or practice of
the employer that the employee reasonably believes:

���� (1)� is a violation of a law
or rule or regulation promulgated by the commission, including any violation
involving deception of, or misrepresentation to, the commission, consumers,
employees, or the general public; or

���� (2)� is fraudulent or criminal
under state law.

���� f.���� A violation of
subsection e. of this section shall be subject to the provisions of the
�Conscientious Employee Protection Act,� P.L.1986, c.105 (C.34:19-1 et seq.).

���� 7.��� a.� Upon a finding by
the commission following an internal audit or an external audit conducted in
accordance with section 3 of P.L.��� , c.���� (C.������� ) (pending before the
Legislature as this bill) that a cannabis testing facility committed fraud related
to quality standards of cannabis items or testing procedures and data, any
person aggrieved by such fraud shall have a civil cause of action for damages
against the cannabis testing facility.

���� b.��� Upon a finding by the
court that that fraud did occur, and the plaintiff was aggrieved by the
purported fraud, the court shall order the defendant to pay the plaintiff three
times the amount of damages sustained plus costs and reasonable attorney�s
fees.

���� c.���� Nothing in this section
shall preclude the commission or the Attorney General from initiating a
criminal proceeding for fraud committed by a cannabis testing facility or any
licensed cannabis business.� Nothing in this section shall preclude the
Director of the Division of Consumer Affairs in the Department of Law and
Public Safety from enforcing this section pursuant to the �Consumer Fraud Act,�
P.L.1960, c.39 (C.56:8-1 et seq.).

���� d.��� It is an affirmative
defense to this section, if the cannabis testing facility proves by a
preponderance of the evidence, that the conduct was not knowingly or recklessly
deceptive.

���� 8.��� a.� A cannabis testing
facility commits an offense, if in the course of business the testing facility
or any employee, owner, or manager of a testing facility:

���� (1)� uses or possesses for use
a false weight or measure, or any other device for falsely determining or
recording the quality of a cannabis item;

���� (2)� sells, offers, or exposes
for sale, or delivers an untested or noncompliant cannabis item;

���� (3)� falsifies any lab test
results on potency, contaminants, or composition of a cannabis item; or

���� (4)� issues a certificate of
analysis for an noncompliant cannabis item asserting compliance with any law or
regulation.

���� b.��� A violation of
subsection a. of this section shall:

���� (1)� for a first offense, be a
disorderly persons offense;

���� (2)� for a second or
subsequent offense; be a crime of the fourth degree.

���� c.���� It is an affirmative
defense to this section, if the cannabis testing facility proves by a
preponderance of the evidence, that the conduct was not knowingly or recklessly
deceptive.

���� 9.� This act shall take effect
on the first day of the third month next following enactment, except that the
Cannabis Regulatory Commission may take such anticipatory action as may be
necessary for the timely implementation of this act.

STATEMENT

���� This bill establishes various
requirements for the cannabis testing facilities related to quality assurance
in cannabis product testing.� The bill requires the Cannabis Regulatory
Commission (commission) to establish a laboratory quality program standard to
improve testing by cannabis testing facilities.

���� The commission is required to
adopt rules on: (1) requirements for cannabis testing facilities that ensure
consistent and uniform testing practices; (2) framework for cannabis testing
facilities to have systems for planning and assessing work performed by the
laboratory; (3) quality assurance and quality control procedures; and (4)
proficiency standards that cannabis testing facilities are required to meet and
maintain in order to obtain licensure to operate pursuant to the �Cannabis
Regulatory, Enforcement Assistance, and Marketplace Modernization Act,�
(CREAMMA) P.L.2021, c.16.� Moreover, it requires any facility which develops a
testing method to have the method approved by the commission.

���� Under the bill, the commission
is required to employ microbiologists and chemists with experience in testing
cannabis for the purpose of conducting audits of cannabis testing facilities
and approving the testing methods developed by cannabis testing facilities.�
The purpose of these employees is to assist the commission in conducting onsite
assessments of testing facilities to ensure compliance with the CREAMMA and any
rules and regulations related to the testing of cannabis items by testing
facilities.

���� The bill also requires that in
addition to internal audits, that the commission, or a designee of the
commission, conduct external audits of cannabis testing facilities to ensure
compliance with testing standards and rules.

���� Further, the bill requires the
commission to establish a secret shopper program.� The program will permit
certain individuals to: (1) conduct anonymous compliance checks on licensed
cannabis facilities; (2) report compliance with packaging and labeling requirements;
(3) ensure compliance with age verification and point-of-sale requirements; (4)
collect product samples for commission laboratory analysis; and (5) identify
any shortcomings in the cannabis market related to public health and consumer
safety.�

���� In addition, the bill requires
that in accordance with current law and rules and regulations, a cannabis
business is required to maintain accurate documentation of laboratory testing
reports and provide such reports to the commission, who will make such tests
publicly available on its Internet website.� Such documentation must also be
provided to customers upon request.

���� The bill requires the
commission to establish a whistleblower access and assistance program related
to cannabis businesses.� The program is required to offer a toll-free telephone
hotline and a secure online portal for the submission of whistleblower complaints.�
The program will be accessible to employees and contractors of licensed
cannabis businesses, and the program will permit anonymous submission.� The
commission is required to properly investigate and audit any cannabis business
who is the subject of a whistleblower complaint.� The bill provides
whistleblowers the statutory protections provided pursuant to the
�Conscientious Employee Protection Act.�

���� Finally, the bill establishes
a private cause of action and criminal penalties for a cannabis testing
facility which commits fraud.

���� If an external or internal
audit finds that the testing facility committed fraud, any aggrieved party by
such fraud shall have a civil cause of action for damages.� Upon a finding that
the fraud did occur and that the party was aggrieved the court shall order the
cannabis testing facility to pay the plaintiff three times the amount of
damages sustained plus costs and reasonable attorney�s fees.�

���� A cannabis testing facility
commits an offense if in the course of business the testing facility: (1) uses
or possesses for use a false weight or measure, or any other device for falsely
determining or recording the quality of a cannabis item; (2) sells, offers, or
exposes for sale, or delivers an untested or noncompliant cannabis item; (3)
falsifies any lab test results on potency, contaminants, or composition of a
cannabis item; or (4) issues a certificate of analysis for an noncompliant
cannabis item asserting compliance with any law or regulation.� A violation of
this bill is: (1) for a first offense, a disorderly persons offense; and (2)
for a second or subsequent offense; a crime of the fourth degree.�

���� A disorderly persons offense
is punishable by a term of imprisonment up to six months, a fine of $1,000, or
both.� A crime of the fourth degree is punishable by up to 18 months
imprisonment, a fine of up to $10,000, or both.