OCM Votes to Expand State’s Licensing

Sept. 12, 2023

By Tiffany Kary

New York’s cannabis regulator is expanding its licensing program for recreational marijuana, potentially paving the way for large public companies to enter a market dominated by illicit sellers and a few small entrepreneurs. 

The Office of Cannabis Management voted Tuesday in Albany to open up the application process for adult-use marijuana dispensaries, as well as cultivators, processors and distributors, starting Oct. 4. They also finalized regulations released in May that accelerate the timeline for big companies such as Curaleaf Holdings and Green Thumb Industries to enter the market. The decision stirred outcries from small entrepreneurs who begged the state to keep big competitors out while they struggle to open enough stores to compete with illegal dispensaries.

“Demand is not the issue in this market, retail access is,” said John Kagia, the OCM’s director of policy.

Companies with current medical licenses in New York can now potentially open a recreational dispensary next to one of their medical dispensaries around the end of this year. They still need to pay a $20 million fee to apply, and meet other criteria. Additionally, companies can still only open a maximum of three recreational dispensaries, with the additional two locations being barred from operating until July of next year, according to Katie Neer, a lawyer at Dickinson & Avella PLLC who works with a group of medical license holders.

The state’s program has so far been tightly restricted because it sought to promote social equity after a legacy of disproportionate arrests of Black and Brown people for marijuana possession. The first licenses were given to those previously convicted of marijuana-related offenses.

That move was criticized by large companies that hold medical licenses in the state and wanted to participate in the recreational market. Because social equity licensees were slow to open their businesses amid scant funding and red tape, the state’s strategy has also been blamed for the explosion of hundreds of illicit dispensaries that have come to dominate the market.

Read the full article at Bloomberg.