March 31 marked the end of the Empire State’s recreational cannabis ban, and the beginning of the painstaking task of creating what would likely become one of the nation’s largest regulated systems. Marijuana markets.
That was the day he was then governor of the state. Andrew Cuomo signed into New York law Marijuana regulation and taxes, one of the most advanced cannabis laws enacted among the 18 states (and the capital) that have fully legalized marijuana. The passage of the MRTA was a historic moment born of decades of pro-competitive activism and political deliberation, and that was the easy part.
In the following months, the Cuomo administration made little or no progress in establishing a regulatory framework for the potentially multibillion-dollar market.
By comparison, his successor, Governor Cathy Hochhol, has spearheaded the operation: Within two weeks of taking office last August, he appointed Hochul. Tremaine Wright As mayor of New York City cannabis control panel And Christopher Alexander As CEO of cannabis management office.
Activists, lawmakers and the New York cannabis business community have welcomed the rapid progress, but concerns remain over what businesses will be able to open first, whether the social justice measures in the law will be effective, and whether Wright’s estimated 18-month timeline for setting up the industry Legalization can be undermined amid mounting gray market.
2022 is likely to be a pivotal year in answering these questions.
“Obviously, it was a hell year, a great year,” the state senator said. Jeremy KonyMRTA co-sponsor.
“We have the opportunity to set the pace for the rest of the country when it comes to adult cannabis use.”
Kony said the passage of the MRTA was a watershed moment, but Cuomo’s inaction on key dates stymied the momentum so much that he and other lawmakers were not sure the Office of Cannabis Management would check.
But Hochul’s rise to the governor’s mansion shook this stalemate at Albany. Kony said her early appointments to Wright and Alexander indicate that the new administration will move with the goal of making the market work.
The five-member Cannabis Control Commission held its inaugural meeting on October 5, and concluded 2021 with four sessions under its belt. At those meetings, board members voted on measures that expanded access to New York Medical cannabis program, and officially launched a file cannabis cannabis program, President Wright told NY Cannabis Insider.
“We have recruited and created a pipeline of top talent to join the rapidly growing Cannabis Management Office team,” Wright said. “As we head into the new year, we will build on this success and continue to work as quickly as possible, while also making sure that we create fair opportunities through the cannabis industry in New York State.”
It’s a tough job. The council needs to set regulations for the nascent industry – starting with the number of licenses the state will approve Create support structures For entrepreneurs seeking a license – especially social equity applicants.
I saw Tell NY Cannabis Insider In December, I predicted that the state’s legal cannabis ecosystem would be in place by around April 2023. Then, in Forum hosted by Crain’s New York Business, moved those goals until late 2022.
Things are going even faster in New Jersey, where Governor Phil Murphy legalized recreational cannabis on February 22. Three days later, Murphy completed assignments to the state Cannabis Regulatory Authoritywhich held its first general meeting on April 12.
On December 15, New Jersey began accepting licensing applications from potential adult cannabis growers, manufacturers and testing labs.
Meanwhile, municipalities across New York have until midnight Friday to ban sites selling and consuming cannabis for adults within their borders. Wright said the opt-out statements “should guide us.”
“This will undoubtedly determine where the retail and consumption licenses are located.”
Social justice concerns
The success of the MRTA’s social justice actions will be determined in large part by decisions made by the State Control Board and other regulators in the coming year.
Jacob Bluden, New York State Coordinator, told Students of reasonable medication policy.
For example, MRTA sets a giving target 50% of its licenses For social justice applicants, which includes people negatively affected by 50 years of the war on drugs. He is also establishing the position of Chief Equity Officer – currently held by Jason Starr – within the Office of Cannabis Management.
Groups eligible for social justice status include individuals disproportionately affected by cannabis ban enforcement, minority or women-owned businesses, distressed farmers and disabled veterans.
Bluden said the next year or so should show whether these measures are working as intended, adding that if social justice applicants obtain a license but lack access to capital, their business will likely falter.
Additionally, he fears that well-earned groups could use “mock figures” to qualify for social justice licenses, only to take over operations soon after. Predatory business contracts can also undermine the MRTA’s social justice language.
“I think it’s kind of a 50/50 omission; it looks good at the moment, but we won’t see until then [licensing starts]Bluden said. “It could derail after a few months.”
Alan Gendelman, President Association of Hemp Growers and Processors of New York State, he said the state needs to ensure that the legal cannabis market is not handed over to a handful of people Multi-country operators. However, it is believed that MSO may be essential in the state’s cannabis ecosystem.
The old New York market is also well established, and an active gray market has emerged since the state legalized cannabis, said Gandelman, owner and CEO of Cortland-based Cortland. Main Street Farms, which grows and sells hemp, vegetables, and other products. He said that if government officials take too long to establish a legal market, the illegal market may prevail.
Gandelman cites a prime example of New York City, where today a wide range of bodegas, delivery services, and other illegal businesses sell cannabis in all its forms. These companies are unregulated, do not pay taxes and generally operate with less risk than when law enforcement prioritized efforts to ban cannabis.
“The longer it lasts, the harder it is to put the genie back in the bottle,” Gandelman said. “We are in a difficult position, and it will be a difficult balancing act.”
Meanwhile, large, multi-state operators are best suited to open quickly, and fast-track licenses for these companies could provide an important breakthrough, he said.
Gandelman said there is unlikely to be a solution that makes everyone happy, but that regulators need to find one that most people can live with. With some of New York’s top 10 medical cannabis companies expected to move into adult use, time is a luxury of limited supply.
He said it was a delicate situation Steve D’Angelo, a businessman and longtime cannabis activist who sold cannabis in the Northeast, including in New York, between 1975 and 2000.
“It’s very complex, and if you don’t think about these regulations, and how the system works, you can have some very serious and very harmful effects” on the emerging legal market, he said.
But the time needed to do so — DeAngelo believes it could take two to three years to open legal retail stores — could undermine New York’s legally regulated cannabis industry.
A potential solution, he said, is to issue temporary licenses to the old operators that would allow them to sell cannabis right away — provided they test their products, meet safety standards, and pay state taxes.
But it’s not clear that regulators or state lawmakers are seriously discussing this matter.
Preparation is the key
David Holland, President New York City Cannabis Industry AssociationIt is also keeping a close eye on which companies will be allowed to start first.
the states 10 registered medical marijuana operators Holland said you have the resources and experience in other states to reach full compliance and obtain licensing soon after the regulations are announced, while smaller players start from scratch.
“Some people think that’s a good thing, some think it’s really unfair; it’s a hot button issue,” Holland said.
However, Holland said there are things that entrepreneurs looking to enter the cannabis industry can do now to prepare to apply for licenses.
For example, no matter what type of license a person or group is looking for, they will need to create a corporate structure (be it a corporation, a sole proprietorship or something else), craft a business model and secure a physical location for operations.
“There is a lot that can be done now,” Holland said.
Stephen Fan, co-founder of Come to daily CBD In Manhattan’s East Village, he’s already taking steps to shift his CBD-based business to the adult cannabis market ASAP. He said he’s branding a name and working on the store’s design while he waits for regulations.
Until then, Fan added, much of the planning is speculative. For example, it is not yet clear whether the company can sell medical and adult cannabis from the same location.
Fan anticipates that regulators in the state may need to adjust some of the rules after the market opens, as it is likely that they will find loopholes in their mandates only after they are in place.
“Here’s the reality of the situation: It’s the government,” said Fan. “They’re setting the rules for New York State — for all of us — and we hope they get everything right, right away.”
“It feels like a huge undertaking, and it’s kind of unreal.”
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