Update on New York Cannabis industry

July 11, 2024

We are well into July and while the New York Cannabis industry is moving in the right direction, it seems to be at a snail’s pace. While new and backlogged licenses are being granted, we still only have 141 dispensaries in New York. This seems to be the pace with New York-two steps forward and two steps back.

New York is in the bottom third

Cannabis was legalized in New York in 2021. The same year, New Mexico and New Jersey also legalized cannabis. As of post time, New York is in the bottom third of open dispensaries in states where it is legal. We currently sit at 141. New Mexico is sitting at about 650 dispensaries and New Jersey is currently at just around 300. While New Mexico is a larger state than NY, New Jersey is about only 15% the size of NY and has more than doubled its legal dispensaries in the same amount of time. Something is amiss and immediate change is needed. The OCM loves to let the public know that they have approved so many new licenses, but they are doing nothing to get those licensees up and running with their storefronts. They continue to push closing illegal storefronts but do not offer legal stores any assistance to open to take their place. If there aren’t any legal shops locally, residents will run to the illegal shops just down the street. It’s not just the dispensaries struggling. The farmers continue to drown in debts and continue to climb out of the hole the state put us in from day 1 with no relief in sight. Limited open stores equals limited income to make improvements and expand current businesses. Indoor growing is legal now, but only a select few have the profit to invest after two failed years of this “rollout”. Thousands of dispensary applicants just wait in the wings for the word they are approved while everything else in their lives sits at a standstill due to incompetence. Pockets keep getting deeper and bigger for the industry politicians, yet we are turning ours inside out looking for any crumb left behind. We are getting bitter and impatient, and it’s warranted.

Lawsuits

While seats have been shifted in the OCM and DASNY, we now are held up with lawsuits against those former executives. DASNY’s former CEO, Reuben McDaniel, is named in a $300 mil. lawsuit from Illinois-based security company American Smart Cities. They were repeatedly assured by McDaniel and his associates that they would be receiving a $100 million contract to install surveillance systems in over 300 hundred dispensaries state-wide, as well as SUNY and CUNY campuses. The lawsuit also alleges that during the project planning period, the defendants made “multiple solicitations” to obtain personal employment, ownership, or compensation from ASC related to the project’s potential revenues, as well as numerous other kickbacks. ASC spent over $500,000 on project prep. and lost millions turning away other projects after being told they would receive this huge job. In early 2023, DASNY decided they were not satisfied with the illegal cuts of the potential profits they would be entitled to from the NY projects. DASNY abruptly, and without notice, informed ASC they would not be selected to complete the NY projects, despite their previous representations. McDaniel no longer is with DASNY and has relocated to Arkansas.

Read more here.

Grow your own

Officials have released home growing regulations. Each adult can have up to 3 immature and 3 mature plants per adult in the household, but a maximum of 12 plants total. (6 immature, 6 mature) Now we can all breathe a sigh of relief when tending our home crops!

First Toga dispensary

Saratoga has opened its first legal dispensary! Silver Therapeutics is now open daily 10-8, at 75 Weibel Ave. They currently have 5 other locations open-Bennington, VT., Williamstown and Palmer, Mass., and Berwick and Portland, Maine.

Illegal buyback program in New York City

Housing Works, the state’s first legal dispensary, is offering an illicit buyback program. Any first-time customer who brings proof of membership at an illicit store will get a free Housing Works membership (worth $25), 25% off their first purchase, and 10% off all purchases for a year. They are the first in the state to offer this type of program to assist in getting illegal stores closed.

Read more here.

Rough go in Woodstock

Woodstock is in the process of opening its first legal dispensary. You would think the heart of the hippie movement would have been one of the first to open a shop, but they have been fighting local authorities over location. The spot approved by the state is within 200 feet of a house of worship and some locals are not happy with the decision. They are still in limbo but hope to be open soon.

New proposals

There is a new proposal in the works to allow legal dispensaries to offer discounts to veterans, seniors, and students of age. Currently, the industry is not allowed to offer any type of discounts on cannabis products which has made it hard to compete with the memberships and discounts at the illicit shops, especially in today’s economy. Within the same proposal is changes to packaging and advertising restrictions. New York is currently banned from offering colorful and flashy packaging, as thought to draw in the underage crowd. This new proposal would eliminate that restriction. It also proposes to allow cannabis advertising on billboards, yet this is something that is still vehemently opposed, as it will “normalize cannabis to the masses.” (Which is kind of the point of our entire industry…)

Read more here.

Stay tuned for more updates on the NY Cannabis industry!