Can New York Learn From California's Mistakes? Make Space For Legacy Cannabis Operators, Please

New York is nearing the one-year anniversary of the Marijuana Regulation and Taxation Act (MRTA) being signed into law and legalizing cannabis. 

Under Gov. Kathy Hochul, New York is taking important steps to get its cannabis market up and running.  Just recently a bill that would provide New York hemp farmers a conditional license to grow, process and distribute marijuana products is heading to Gov. Hochul's desk after being passed by the state Assembly. 

However, it seems that New Yorkers will not be able to walk into a shop and buy weed any time soon.

The Opt-Out Clause

Like most states, New York provides an opt-out clause allowing localities to say no to cannabis shops in their communities even before regulations are implemented.

As it turns out, legal cannabis seems not to be a priority for nearly half of New York towns -54% percent of 1,521 municipalities don't want consumption sites and 47% are against allowing cannabis dispensaries.

Unequal Playing Field

Drawing parallels between California's cannabis industry, which some say is  "in a state of disarray," for the same opt-out reason. Steve DeAngelo, wrote in a Times Union op-ed that "there's still an opportunity in New York and other states to create an equitable and sustainable legal market."

The shortcomings of the California market include allowing localities to set high cannabis taxes and over-regulation that made it impossible for most small growers and retailers to get licensed, which in turn gave more space to corporate multi-state operators.

Open Door To Legacy Operators

For those unfamiliar with the term, legacy operators are those who have been selling weed all these years before legalization, many of whom are skilled, honest and have developed proper markets. 

Leaving these people out, said De Angelo, "isn’t just the right thing to do. Legacy operators won’t suddenly disappear if they are left out of the legal system."

DeAngelo proposed a "comprehensive approach" to welcome these folks into New York's legal market. This would require "an amnesty program that will allow for a fresh start, first-priority licensing so existing operators can preserve the markets they have created, and generous financial and training support to provide the skills and resources needed for mainstream success."

Cannabis "Gifting" Retailers Also Taking A Hit

Lately, stores selling a product or service to consumers and then giving them cannabis as a “gift” has become a thing in New York. In fact in some cases, they may simply be selling cannabis at retail shops even though no licenses are yet available.

This "gifting" practice has come to the attention of the Office of Cannabis Management's (OCM) Enforcement Unit, which recently sent "cease and desist" letters to more than two dozen businesses it found to be doing just that.

Chris Alexander, OCM's executive director said that public health and safety were the main reason behind the move.

"New York State is building a legal, regulated cannabis market that will ensure products are tested and safe for consumers while providing opportunities for those from communities most impacted by the over-criminalization of the cannabis prohibition, and illegal operations undermine our ability to do that," Alexander said, adding that New Yorkers should sit tight, wait and not "partake in illicit sales."

Photo: Courtesy of Benzinga