New York Officials Grilled At State Senate's First Hearing On Cannabis Market Struggles

In Buffalo, the first joint public hearing of the New York State Senate's Sub-Committee on Cannabis took place Monday and lasted seven hours. That may still not have been enough time to address the many issues dogging the state's cannabis program, starting with the painfully slow rollout of the retail market as illicit sales flourish.

Over the course of the hearing, 13 panels composed of officials from various state entities such as the Office of Cannabis Management (OCM), the Cannabis Advisory Board as well as numerous industry representatives and licensed cannabis business owners provided testimony.

OCM executive director Chris Alexander recognized the challenges and said he was hopeful about overcoming them. 

"There is so much more to do," he said. "This transition has been a painful one for so many but I and my team will continue to do the hard things and will continue fighting to ensure that New York's cannabis market becomes what we all know that it can be."  Questions Kept Coming

Alexander and other OCM officials were peppered with questions from state officials on a range of issues, including the scarcity of legal shops, the proliferation of illicit operations, ongoing legal challenges, difficulties faced by farmers and enforcement measures. 

There are only 27 legal stores open in NY state, leaving farmers with a surplus of crops they can’t sell. Senator Michelle Hinchey (D), chair of the Committee on Agriculture, asked how much money farmers have lost because of this.

"I don’t have that number,” Alexander replied. “I’ll have to get back to you on that.” She suggested setting up a recovery fund for struggling cannabis farmers.

Despite the intense questioning, dialogue with OCM officials largely revolved around current and future efforts to improve the situation.

"What do we need to do because clearly whatever we did isn't really working," said Senator Liz Krueger. (D-Manhattan) who helped write the Marihuana Regulation and Taxation Act, which laid out the state's legalization program.

Enforcement Was A Key Topic

Senators asked about the discrepancy between the number of enforcement actions taken and the relatively few fines issued. Of the nearly 300 enforcement actions against illegal cannabis operations, Alexander said only 16 have resulted in fines.

Landlords in NYC who rent store space to illegal weed or tobacco sellers face $10,000 fines. 

Too Little, Too Late?

The discussion went so far as to ask whether it was too late to rein in the unregulated market and establish a viable regulated system. Despite challenges, Alexander insisted the goal is to continue opening more legal shops.

Business owners and industry leaders also shared their frustrations, pointing out poor communication from the OCM and the financial burdens they face due to the drag of retail sales.

After more than seven hours of testimonies, it was still unclear what immediate steps could or would be taken, or if legislative actions would be required.