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Cannabis Growers Showcase organizers will have to meet strict compliance requirements and charge less for products than dispensaries typically charge, a high-up Office of Cannabis Management official said Thursday.
During the virtual town hall meeting, OCM Director of Policy John Kagia went over some of the rules for organizing, staffing and operating growers showcases, an initiative the Cannabis Control Board approved last week to offload some of the backlog of cannabis flower grown by the state’s conditional cultivators.
“We are going to be holding these licensees accountable for very robust compliance requirements,” Kagia said.
Among the rules Kagia outlined in the hour-long meeting, showcase organizers will have to adhere to the same buffer zones as brick-and-mortar dispensaries, and may only sell flower products at a 50% mark-up from wholesale prices (dispensaries typically sell their products at a 100% markup, Kagia said).
Additionally, Kagia said OCM will permit growers showcases to take place at existing events, but only if they can reasonably assume most attendants will be over 21.
As he mentioned during last week’s CCB meeting, Kagia said each event will need at least three cultivators and one Conditional Adult-Use Retail Dispensary licensee, and organizers must receive municipal approval before seeking OCM approval for a showcase event. The CAURD participant has to be operational (21 currently exist) and events may also include one processor for every three cultivators.
The OCM will allow growers showcases until the end of this year, Kagia said. Organizers putting on showcases before Sept. 5 must receive municipal approval at least 10 days before the event will take place, and those planning an event after that date must get approval at least 20 days prior.
OCM officials overseeing the application process are being concise, but moving quickly, said Joann Kudrewicz, CEO of cultivation company Ravens View Genetics and chair of CANY’s Cultivation Committee. The application is extensive, but not overly burdensome, she said.
“It’s not quite as involved as I imagine it could have been, but you have to have all your ducks in a row,” Kudrewicz said.
It took only days for them to approve an event Kudrewicz was organizing, but the process required all participating companies to provide information about employees who will be onsite (and their birth dates), and an exact count of the inventory they’d bring – which officials checked against OCM records. However, that event fell through when the venue backed out, and Kudrewicz is currently working on other possible showcase events.
While Kudrewicz is bullish on the showcases, there are a few aspects she finds onerous for companies participating. Limiting retailers to a 50% markup means they might make half the profit selling products at a growers showcase than they’d make at their store – while still having to pay staffers their regular rates. Additionally, some municipalities are insisting they hold a public meeting before approving showcases, which can take up to a month.
“I’m hearing the biggest obstacle has been in the municipalities,” Kudrewicz said.
Tina Holava-Hughes of Mother’s Medicinals and Mike Golden of The Higher Calling in their combined cannabis-related stand at the 2022 New York State Fair. (Don Cazentre | dcazentre@syracuse.com)
Mike Golden, head of CAURD licensee The Higher Company LLC, is trying to organize a growers showcase at the New York State Fair in Syracuse, but isn’t sure if it will happen, due to reticence from the venue and OCM’s requirement that showcases only occur at events where most attendees are over 21.
While Golden said he understands concerns about possible second-hand smoke and adult products being sold at a venue many families attend, the rules seem lopsided when compared to alcohol – which is readily available at the State Fair.
“There are always alcohol options … and I thought there should be cannabis options as well,” Golden said. “I mean, people have been double-fisting and getting into fights for years.”
But he’s not putting all his eggs in one basket, Golden said. He’s currently working with some growers to organize a series of showcase events at TokaBocca, a cannabis-themed restaurant in Old Forge.
American flags are displayed at the New York State Fair in Geddes, N.Y., Sept. 02, 2015. Kevin Rivoli | syracuse.com
Joe Rossi, a managing director at Park Strategies and leader of the firm’s Cannabis Practice Group, also noted the disparity in requirements between growers showcases and events with alcohol. He said the inconsistency is especially apparent when looking at the State Fair, which is famous for its wine slushies and alcohol-fueled incidents.
“Preventing a growers showcase at the New York State fairgrounds is a contradiction, and we’re past that with stigma for cannabis,” Rossi said.
Kudrewicz agreed that restrictions for the cannabis retail events are stricter than events that sell alcohol, but added that right now that’s just a fact of life.
“At this stage, there’s a lot of disparity between the alcohol industry and cannabis industry, and I do think that will lighten over time,” Kudrewicz said. “All of us have to be mindful that it has to be done right … we all need to succeed with this program.”