Marijuana is legal in many states, but a lack of regulatory processing means the industry is slow to grow. New York is addressing their state issues by opening a cannabis public license application for new businesses. It will help many marijuana entrepreneurs realize their business goals.
About New York’s Cannabis Public License Application
New York’s cannabis public license application will be open to the public on Dec. 4. Regulators expect to start awarding licenses in early 2024.
The state approved recreational marijuana sales in December 2022. Since then, only about two dozen cannabis retailers have opened throughout New York. Governor Kathy Hochul (D) blames the illegal industry for delays.
Part of the effort involves targeting illegal businesses. The governor will increase law enforcement efforts to shut down unlicensed marijuana operators. She believes her strategy will implement a speedier transition from an underground market to a legal market.
“Today’s an important milestone in our efforts to stand up a brand new industry,” said Hochul. She expects “tens of thousands” of applicants. Licenses will be granted through a lottery system. She hopes to have more than 1,000 legal cannabis shops running by the end of next year.
The New York City Department of Small Business Services is also doing its part. It is providing FastTrac, an educational program that “connects cannabis business owners with free, high-quality training and advice proctored by leading players in the cannabis industry.”
The organization announced the program the same day the city opened the cannabis public license application. People must apply for the FastTrac program by the October 18 deadline.
The Cannabis Public License Application Will Target New York’s Illegal Market
The governor estimates that there are over 2,000 marijuana shops currently operating in the state illegally. Many continue to operate without penalty.
The state aimed to take steps to shut down its illegal market. They worked to create a market that focused on social equity and sought to provide licenses to people who had been negatively affected by prohibition.
But the process has been slow and more illegal cannabis businesses have opened while the system struggled.
Lawsuits have also put a temporary halt on licensing. In August, a group of disabled military veterans filed a lawsuit arguing the state’s system of prioritizing licenses for certain social equity applicants was unconstitutional. The judge presiding over the case put a hold on licenses until it is resolved.
The governor says the state’s legal issues are coming from “big companies from out for the state, you know, greedy corporations that wanted their piece of it before we can make it available to veterans and (minority- and women-owned business enterprises) and focus on a social equity component, which was the intent of the law.”
“But today’s a breakthrough. We’re going to keep going, and by the end of the year we should be seeing a process that is much smoother than it has been today,” she went on to say.
Crackdown on Illegal Businesses
The cannabis public license application is making it easier for businesses to obtain licenses. But the state is also trying to shut down illegal markets that steal business from legal operators.
New York law enforcement has already seized over four tons of illegal cannabis products valued at $42 million statewide. They plan to impose “continued aggressive enforcement against the illegal sale of cannabis across the state.”
“We will continue working to build the most equitable adult-use cannabis industry in the nation that invests in communities and rights against the wrongs of the past,” Hochul said.
“Let’s shut them down. Let’s padlock them. We’re intent on making this successful. Ultimately, we will,” she said, describing her aggressive stance against illegal operators.
Supporters of the Cannabis Public License Application
The cannabis public license application and Hochul’s efforts to shut down illegal markets have gained the support of State Attorney Letitia James (D). “By holding unlicensed cannabis sellers accountable, my office is helping ensure New York can realize the purpose of MRTA, namely to remediate some of the societal harm caused by the so-called war on drugs,” she said.
New York Office of Cannabis Management (OCM) state leader Chris Alexander showed his support saying, “New York’s market is centered around equity, with the nation’s strongest anti-trust protection in place that ensures small operators will forever have a place in our cannabis industry.”
Cannabis Control Board (CCB) leader Tremaine Wright also approves of the cannabis public license application and the state’s efforts. “Today, the day our general application window opens marks a huge step forward in making our vision of an equitable and accessible New York cannabis market a reality,” he said.
Other Efforts to Improve New York’s Cannabis Industry
The cannabis public license application is not the only effort moving New York’s cannabis industry forward. Senator Jeremy Cooney (D), who chairs the state’s first cannabis committee, announced a marijuana hearing in early September. It aims to “finally address the many challenges that we have seen with the rollout of adult-use cannabis here in New York.” He has invited the public to testify at the hearing.
The Cannabis Control Board is also helping make retail licensing more accessible. It has made a controversial move by proposing to open licensing to medical marijuana companies and big businesses from outside New York. Many social equity applicants are against this effort as they feel it would undercut their chances of obtaining licensing.
The New York Office of Cannabis Management is also helping the state cannabis market. It launched the Cannabis Grower’s Showcase which would allow growers to sell directly to consumers. The first pop-up event occurred in Hudson Valley in August. Another was hosted at the state fair.
State lawmakers who account for about a third of the state legislature wrote the governor to ask her to sign a bill to allow marijuana growers to sell to tribal retailers. If approved, it would provide farmers with an additional outlet for selling their surplus stocks. Currently, growers are holding on to more than 250,000 lbs. of unsold product.
“Famers who took out loans and leveraged all their assets to cultivate these crops are demoralized and facing financial disaster unless we act quickly to provide them with an alternate market,” the request letter said.
The cannabis license application and other efforts will make the industry more favorable for businesses, consumers, and entrepreneurs. It is a positive move forward for New York State.