New York state cannabis regulators approved sweeping new rules Tuesday, opening up the application process to operate licensed pot stores that have been limited to the “justice-involved” — those convicted of marijuana crimes when the drug was illegal.
The new rules will allow “social equity” applicants — including disabled military veterans, minority and women business-led firms and distressed farmers — to apply to operate a weed dispensary beginning Oct. 4.
Four disabled vets had sued Gov. Kathy Hochul’s administration and the state Cannabis Control Board for excluding them from applying for the first-round licenses and instead awarding them to applicants with pot convictions.
A state judge recently issued an injunction barring the state from issuing any more licenses, saying the preference for weed felons likely violated the state law legalizing marijuana for recreational use.
“It’s about time,” said Carmine Fiore, a disabled vet and plaintiff in the case.
“We finally have an equitable playing field. We are finally being prioritized — as we should have been under the law.”
It’s unclear what impact the new rules would have on the ongoing litigation. Cannabis regulators who are defendants in the case went into an executive session behind closed doors at the end of their meeting Tuesday.
Fiore said while he’s now allowed to apply for the cannabis store license, it didn’t “stop the harm” from being excluded from applying for a Conditional Adult-Use Retail Dispensary (CAURD) in the first place.
“They gave the justice-involved an unfair advantage,” he said.
The Cannabis Control Board rules also dramatically broadened eligibility for individuals and entrepreneurs to apply for licenses to become cannabis cultivators/farmers, processors, distributors and micro-businesses.
The state’s budding legal marijuana has suffered from a slow and rocky rollout with just 23 cannabis stores across the state, nine of which are in New York City. Meanwhile, city officials estimate there are up to 1,500 unlicensed smoke shops selling cannabis.
Farmers fume that the lack of stores has them sitting on a massive amount of flowered weed grown last year.
State officials said Tuesday the new rules will help grow the weed market.
“Today marks the most significant expansion of New York’s legal cannabis market since
legalization, and we’ve taken a massive step towards reaching our goal of having New Yorkers
being able to access safer, regulated cannabis across the state,” said Chris Alexander, executive director of the Office of Cannabis Management.
“We are immensely proud to be building the fairest, most competitive cannabis industry in the nation — one that puts those most harmed by prohibition first and offers a true opportunity for all New Yorkers — not just large corporations — to compete and thrive,” he said.
The multi-state firms that sell marijuana only to medical patients in New York will be able to offer their cannabis products to all New Yorkers for recreational use beginning at year’s end. However, many individuals or small operators who spoke at the meeting Tuesday worried that they will dominate the market before they can get up and running.
Many asked for state regulators to delay the multi-state operators’ entry into the market.
“Delay them from not just retail, but also from cultivation and manufacturing … These corporations are slowing us down, trying to starve us out so they can swoop in like vultures and pick at our carcasses. New York made promises to us, now it’s time for you to back those words up with real actions,” an open letter co-signed by 18 licensed cannabis operators said, including Osbert Orduna, CEO of The Cannabis Place in Queens.
A group bankrolled by the medical marijuana operators said opening up the application process is a start, but also complained the state doesn’t go far enough in expanding the market to allow them to sell weed for recreational use sooner.
“The rules passed today are a step forward. But until the State actually issues these licenses and these dispensaries get open and operational, New Yorkers will continue to be denied the tax revenue, safe cannabis, and equitable system they were promised,” said Kirsten Foy of the Coalition for Access to Regulated and Safe Cannabis.
“Allowing the businesses that have built New York’s medical market to enter the adult-use industry would help close that gap. But since these medical operators can only open a maximum of 33 dispensaries, OCM still must act expeditiously and efficiently to legally open the thousands of additional dispensaries it claims the State needs.”