New York legalized recreational marijuana in March, but the state has yet to establish the rules and regulations for the emerging industry. This has left many aspiring cannabis entrepreneurs in limbo, waiting for clarity and guidance from the state authorities.
Some of these entrepreneurs are participants of the state’s medical marijuana program, which was launched in 2016 and allowed 10 companies to operate in New York. These companies were promised priority access to the recreational market, as well as the opportunity to open four retail outlets each.
However, according to a report by CNN, these companies have not received any information from the state about where they can locate their stores, how much they will have to pay in fees and taxes, or when they can start selling to adult-use customers. Some of them have invested millions of dollars in building facilities and hiring staff, but they are still waiting for the green light from the state.
“We’re ready to go. We have the infrastructure, we have the capital, we have the people. We just need the state to give us some direction,” said Hillary Peckham, chief operating officer of Etain Health, one of the medical marijuana companies.
Another challenge facing these companies is the lack of accurate construction costs from the state. The state law requires that 50% of cannabis licenses go to social equity applicants, such as people from communities disproportionately impacted by the war on drugs, women-owned businesses, veterans, and farmers. To help these applicants, the state is supposed to provide them with low-interest loans, grants, and technical assistance.
However, without knowing how much it will cost to build a cannabis facility or a retail store, these applicants cannot plan their budgets or apply for funding. Moreover, without knowing where they can locate their businesses, they cannot secure leases or permits.
“We need some clarity on what the costs are going to be,” said Gia Morón, president of Women Grow, a national network of women in the cannabis industry. “We need some clarity on where we can operate.”
The state’s delay in setting up the regulatory framework for the cannabis industry is partly due to the political turmoil surrounding former Gov. Andrew Cuomo, who resigned in August amid multiple scandals. His successor, Gov. Kathy Hochul, has vowed to expedite the process and appoint the members of the Cannabis Control Board and the Office of Cannabis Management, which are responsible for overseeing the industry.
“I’m not going to drag my feet on this one,” Hochul said in September. “There’s a lot of money that could be coming into our state that could help us rebuild post-pandemic.”
However, some cannabis advocates are skeptical that the state will meet its deadlines and fulfill its promises. They point out that New York has a history of slow and bureaucratic implementation of cannabis policies, as well as a lack of transparency and accountability.
“We’ve seen this movie before,” said Kassandra Frederique, executive director of the Drug Policy Alliance, a national advocacy group. “We need to make sure that this time is different.”
