This post was originally published on this site.
This guest column was written by Joe Rossi, the Cannabis Practice Group Leader at Park Strategies. The views and opinions expressed in this article are those of the author, and do not necessarily reflect the views or positions of NY Cannabis Insider.
This week, we need to remember the words of an extraordinary New Yorker who said “Power conceives nothing without demand. It never did and it never will.”
This week, the New York Cannabis Control Board will hold a public meeting of the Board at 1:00 P.M. on Wednesday, Jan. 24, 2024, at SUNY Global Center, 116 E 55th St., Global Classroom, New York City.
Board Member Adam W. Perry will be joining from 181 Ellicott St. in Buffalo in a location accessible to the public. Board Member Jennifer Gilbert Jenkins will be joining from SUNY Morrisville, Bicknell Hall, Room 212, 80 Eaton St. in Morrisville in a location accessible to the public. This meeting will be open to the public and you can attend and provide public comment from any of the above locations. But you need to pre-register and can do so here.
New York cannabis entrepreneurs need to attend, speak up and urge the Cannabis Control Board to use the power and authority they have right now, and may not know they have. This board has the authority to increase the allotment of retail dispensary and microbusiness licenses, especially for those who have secured their own locations. (Not “conditionally” secured, but actually signed a lease and are paying rent, or have bought a location and have held the deed for months, and in some instances, years.)
The OCM originally stated in its Licensing FAQ that it would issue 500-1,000 retail licenses. And many of you applied based on those totals. Since then, it has been changed to 250 retail licenses/250 provisional (500 total), and now it’s a lottery. Nowhere in the Licensing FAQ says the word “lottery.”
Why the change? OCM Executive Director Christopher Alexander said the board will issue 250 permits to start as he expects dozens more of the 463 Conditional Adult-Use Retail Dispensary (CAURD) program licensees to open shop in the next two months.
“We’re trying to keep a balance so that we never crash the market,” Alexander said. “Just a couple months ago… farmers had excess product that couldn’t get onto shelves. We also don’t want to be in the opposite position where shelves are empty, and so we try to keep balance in the supply chain.”
That contrasts with what OCM Policy Director John Kagia said during the Sept. 12 CCB meeting, when he said, “Our early performance thus far makes it clear that demand is not the issue in this market — retail access is.”
We all want to see the CAURD program succeed, however, as an article in Cannabis & Tech Today recently reported, “The CAURD applicants who received licenses in the early days of the program are struggling to stay afloat. Many are paying rents or mortgages on unused buildings, begging investors not to jump ship, and signing over future profits for financial help today.”
And there are also legitimate concerns with the CAURD program from the state legislature. Just this past November, MRTA Sponsor and Senate Finance Chairperson Liz Krueger (D) said, “We need an investigation of the DASNY/private equity deals, which appear to be predatory and exploitative of CAURD licensees.”
Let me make one thing perfectly clear: The OCM is a body of professionals doing their best. There are good, hard-working public servants at the OCM. That is a fact. If I felt otherwise, I’d tell you.
However, there has been criticism of the OCM’s rollout, including from many in the state legislature and executive branch.
“Most, if not almost all the stakeholders that I’ve interacted with, they have viewed the rollout … as challenging, to put it kindly, if not unsuccessful or a failure,” said Senator James Skoufis (D), Chair of the Senate Committee on Investigations and Government Operations, at the October Subcommittee on Cannabis Hearing that Senator Jeremy Cooney (D) coordinated.
At that same hearing, Senate Agriculture Committee Chair Michelle Hinchey (D) commented on the surplus of legal cannabis and said she and other lawmakers have been sounding the alarm since the middle of the legislative session last year “on the crisis that’s happening right now for our cannabis farmers – to effectively very little to almost zero response.”
NYS Assembly Economic Development Committee Chair Al Stirpe (D) recently described OCM as an informational “black hole” compared to other state agencies. Assembly Agriculture Committee Chair Donna Lupardo recently said the New York cannabis farmer is “financially ruined” based on circumstances beyond their control.
OCM’s Alexander is quoted saying the “slow rollout is the product of a choice that we have made as a state …The choice to do the hard thing. To make sure that those who are impacted have an opportunity to participate in a meaningful way.”
Yet, NYS Budget Director Blake Washington said recently that the state’s slow rollout of legalized marijuana sales has created fiscal stress and said calling the rollout effort disappointing “is an understatement.”
Everyone in government understands that constructive criticism is expected. However, a lot of New York cannabis applicants that are unfamiliar with government are afraid to speak up out of fear of retaliation. That may be an irrational fear, but it is a real fear.
New Yorkers need to know “… the operation of responsible democratic government requires that the fullest opportunity be afforded to the people to petition their government for the redress of grievances and to express freely to appropriate officials their opinions on legislation and governmental operations.”
You absolutely can speak up without fear of retribution, not just because free speech is protected in the United States Constitution, but because good government feeds off public comment. Plus, it’s illegal for anyone to abuse authority in that fashion.
Regarding the CCB’s authority to issue retail dispensary licenses, the MRTA states: “No retail license shall be granted for any premises, unless the applicant shall be the owner thereof, or shall be able to demonstrate possession of the premises within thirty days of final approval of the license through a lease, management agreement or other agreement giving the applicant control over the premises, in writing, for a term not less than the license period.”
So, many New Yorkers went and legitimately secured a location. Not through a conditional lease, or a Letter of Intent, or a sublease arrangement. They also secured their Certificate of Occupancy (COO), Labor Peace Agreements, and everything else they were told they would need. These New Yorkers used their own money and made capital investments. Now those New Yorkers find themselves in a Hunger Games-like lottery.
It’s not right. It may be legal. But it’s not fair.
Simply put, New Yorkers need the Cannabis Control board to deliberate on Wednesday and invest themselves in their assigned authority. We need them to significantly increase the number of licenses issued for retail dispensaries. Period. If these retail licensees will not have enough product on their shelves, which has been suggested and is also highly debatable, that will be their problem.
And most importantly, this board should not be limiting the awarding of retail licenses to just a few hundred right now, while the entire state is dealing with the explosive proliferation of thousands and thousands of illicit ‘dispensaries.’ Leaders across New York have acknowledged that to combat the illicit dispensaries/bodegas/smoke shops, we need more legal dispensaries.
These illicit stores are selling whoknowswhat and it has created a public health emergency. The Cannabis Control Board must recognize the fate of these New Yorkers who secured their locations and followed the rules, rests with them. I plead to them to please debate this issue at the Cannabis Control Board meeting this Wednesday. Please game this out, even if it takes a few hours.
If the CCB ends up issuing 1,000 retail licenses to those with their own location from the current applications, it will still be a fraction of the thousands of illicit stores our kids think are legitimate. By the way, when the OCM suspended the enforcement hearings of those illicit shops, it only emboldened those illicit operators to continue to expand and expand and expand. The Cannabis Control Board members have the authority to determine the final number of licenses issued as well as the timing of the issuance of those licenses. Please use it.
I am a veteran lobbyist in New York at a top ten lobbying firm surrounded by unbelievable experts in our Cannabis Practice Group, and yet, following the OCM’s ever-changing license process is still like trying to nail Jell-O to the wall. Imagine how the average New Yorker who attended the OCM’s Roadmap to Adult-Use Applications workshops, and were encouraged to apply, must feel.
On the bright side, there are 3,500+ liquor stores in New York State, and ideally there will be as many adult-use (legal) cannabis dispensaries. This will be a multibillion-dollar industry in NYS someday. But not without the Cannabis Control Board exercising their authority. As that extraordinary New Yorker and Rochesterian I quoted at the top also said, “Our destiny is largely in our hands”. If you would like to share your concerns to the Cannabis Control Board prior to the meeting Wednesday, thankfully you are able to email the board members as they are public officials. Their email addresses are:
To conclude, for those that will no doubt criticize me for this opinion, I will triple-down and quote one of New York’s greatest, who said, “I prefer to be true to myself, even at the hazard of incurring the ridicule of others, rather than to be false, and to incur my own abhorrence.”