New York on Monday took a significant step toward establishing a legal recreational cannabis market by granting licenses to 36 companies and nonprofits to operate the state’s first retail dispensaries.
The state cannabis regulatory body voted Monday to grant the licenses to 28 entrepreneurs and eight non-profit organizations, completing a seed-to-sale supply chain that should allow legal sales to begin in the state despite a legal challenge to the licensing program. Regulators have also released 282 pages of draft regulations laying the groundwork for the broader market.
State officials issued licenses to recipients selected from a pool of 903 applicants, who were primarily individuals previously convicted of cannabis offenses or their close relatives, as well as a few non-profit organizations representing individuals with arrest or imprisonment history serve.
The licensing effort should help the state meet its goal of prioritizing people in communities heavily targeted during the drug war for opportunities in the legal cannabis industry. As in the rest of the country, New York’s marijuana ban has swept most black and Hispanic residents into the criminal justice system, despite similar levels of use across all races.
Tremaine Wright, the chair of the board, called Monday’s vote “a monumental moment.”
“Not long ago, the idea of legalizing cannabis in New York seemed incredible,” she said. “Now we’ve not only legalized, we’re building a legal market for adult use with a stock-centric approach.”
The Office of Cannabis Management, which develops regulations under the agency’s oversight, said most of the licenses went to people in New York City and Long Island. Freeman Klopott, the agency’s spokesman, said 19 of the 28 licenses granted to individuals were to people belonging to minority racial and ethnic groups, while 20 of the recipients came from areas with some of the lowest median household incomes in the country.
Naiomy Guerrero, 31, watched as one of her older brothers, Hector, was arrested a number of times for possession of marijuana during the Stop, Question and Frisk era. The program, under Mayor Michael Bloomberg, saw police conduct millions of unwarranted pedestrian stops and searches in predominantly Black and Hispanic neighborhoods like Morris Heights in the Bronx, where the Guerrero siblings grew up, before it was declared unconstitutional in 2013.
More about cannabis
As recreational marijuana becomes legal in several states, cannabis products are becoming more readily available and more diverse.
The siblings, who identify as Black Latinos, and their father received a license Monday and expect to open dispensaries in the Bronx.
“Doing this for my family, moving this forward, is my life’s work,” she said. “If the true goal of cannabis in New York is to be fair, then who better than us? Because we suffered from the War on Drugs. We come from the most heavily policed neighborhoods in the Bronx.”
Those who have received licenses are required to submit additional information about their finances and business partners before their licenses are finalized. They will then be allowed to start deliveries from locations of their choice, a postponement announced by regulators on Monday said would allow operators to “generate capital and scale their operations.”
But the move suggests the state may struggle to provide license holders with storefronts and credit as planned. Reuben McDaniel III, the president and chief executive officer of the State Dormitory Authority, the agency that oversees the leasing and design process for the storefronts, declined to comment after the meeting.
The license holders will be entering a market already saturated with unlicensed sellers, including a collection of recently established storefronts across the state.
Axel Bernabe, chief of staff and senior policy director for the Office of Cannabis Management, said earlier this month that the first round of recommended candidates for licenses would represent the “top tier” of applicants.
Once approved, state regulators would “assist them as much as they can to find an office, open a dispensary and essentially start dispensing the estimated £200,000 of product and several hundred product lines that we receive from conditional growers and processors.” see it coming”. said Mr. Bernabe on November 3 at the Business of Cannabis conference.
The draft regulations set out fees and deadlines for several other license types, including co-ops and more retail, as well as conditions for the state’s medical cannabis providers to enter the recreational market. The public has 60 days to comment.
However, the much-anticipated guidelines for delivery services and on-site consumption were not included, and regulators said they would be available at a later date.
New York legalized recreational cannabis for adults in March last year, allowing possession of up to three ounces of weed, or 24 grams of concentrate, for personal use. Officials have said retail sales will begin before the end of 2022.
Licenses went to at least three New York City-based nonprofits: Housing Works, The Doe Fund, and LIFE Camp.
LIFE Camp, a nonprofit founded by Erica Ford in 2002 to reduce violence and arrests in Southeast Queens, is credited with being the first black women-led nonprofit to be licensed.
Ms. Ford said the vast majority of her workers, who range from marketers to violent conflict mediators, have had negative experiences related to decades of marijuana prohibition, including being arrested or used violence. Being considered for a license, she said, gives her hope “that by working together, we can make real change.”
“And we want to get the cannabis board and everyone involved in this industry grounded in honesty,” she said.
The first wave of applicants applied for a total of 175 licenses that allow operators to open up to three pharmacies. A large majority, 150, is slated to go to companies the state plans to provide with turnkey locations — properties for rent — and loans to cover the cost of preparing storefronts. The remaining 25 licenses are reserved for non-profit organizations.
Among those who received a license at Monday’s meeting was Matthew Robinson, 36, a black man who was arrested in Albany in 2005 with two bags of marijuana by police officers who believed he was a suspect in a fight at a local mall. Also present was Nicholas Koury, 33, who is of Lebanese descent and was arrested by a federal police force in 2017 after police found four pounds of weed in the trunk of his car in the Bronx.
Housing Works, a nonprofit organization that helps people who are homeless and living with HIV and AIDS, said in a statement that the organization was “honoured.” received a license, adding that one would help support their mission.
New York is the first state to specifically reserve licenses for nonprofits, and it’s unclear how that might affect the groups’ state tax status, as cannabis remains illegal at the federal level.
Another nonprofit approved Monday was the Center for Community Alternatives, a Syracuse-based organization that provides alternatives to incarceration for those arrested and reentry services for those returning from jail and jail across the state .
David Condliffe, the chief executive, said that granting pharmacy licenses to nonprofits like his had a public safety benefit. “The programs we offer make communities safer,” he said. “And this becomes a way to fund these programs without relying on the taxpayer. It’s really important and will improve public safety.”
The state is temporarily prevented from issuing 63 of the licenses for five regions, including Brooklyn, due to an injunction in a federal lawsuit filed by a Michigan-based company. Plaintiff, Variscite NY One, argues that the criteria requiring applicants to have strong ties to New York, such as a place of residence or headquarters, and to have a marijuana-related conviction in the state violate the constitutional protections of the interstate trade.
Regulators said they were prepared to grant 18 licenses in regions affected by the injunction, including Albany, Brooklyn and Buffalo.
The state has not said if it plans to appeal the decision.