Medical marijuana companies condemn Hochul over legal cannabis marketing mess in New York: ‘abuse of authority’
Medical marijuana sellers have asked Gov. Kathy Hochul to allow them to sell their product to all adult consumers — after being denied the Empire State’s law legalizing marijuana sales.
The four medical cannabis operators — who were the first in New York to be licensed to sell marijuana, albeit only for medicinal purposes — urged Hochul to reverse course and offer them licenses so they can help make the slow and rocky launch of the state to advance and boost sales and tax revenues.
“OCM [Office of Cannabis Management] has ignored the collective wisdom of all other states with an adult-use cannabis program—most recently Maryland—to allow existing medical operators to compete against the adult-use market,” the operators wrote in an Aug. 31 letter to the governor , available from The Post.
“OCM has abused its powers under the New York City Adult Use Act, made politics with the licensing process and allowed thousands of unregulated, commercial sellers to flood the market with unregulated and unsafe cannabis products,” the strongly worded letter continued. “Today, the state’s entire cannabis ecosystem is in dire need of a new direction.”
Under the law approved by the state legislature, regulators issued the first cannabis retail licenses to convicted marijuana dealers — under a licensing program that is now deadlocked in court after war veterans filed suits saying they had been unfairly left out .
The letter to Hochul noted that a large number of illegal marijuana stores had sprung up while only 23 state-licensed dispensaries had opened, giving illegal operators an opportunity to cannibalize the market without paying taxes, and some spoiled weed for sale.
“The state’s ineptitude is endangering New Yorkers who seek to safely and legally consume cannabis while hurting taxpayers,” reads the letter, signed by Matt Darin, CEO of Curealeaf; Brett Novey, CEO of PharmaCann; Ben Kover, CEO of GTI and Denis Curran, CEO of Acreage.
Medical marijuana operators claimed that immediate licensing would more than double the number of adult marijuana dispensaries in the state while helping other cannabis sellers, including convicted cannabis traffickers, to keep their businesses running.
The operators noted that they have an integrated infrastructure to provide a stable supply chain of safe, tested and taxed cannabis products for new businesses.
“For years, New Yorkers have trusted us to build and expand the Empire State’s medicinal cannabis program,” they wrote. “Now, a decade later, our plea is simple: direct OCM to authorize registered organizations to begin adult cultivation and dispensary operations immediately so that the state’s legal cannabis market can thrive for all participants and a reliable one Revenue and employment industry is emerging for decades to come.”
New York State authorized the sale of marijuana for prescribed medical purposes in 2014 and legalized recreational cannabis sales seven years later.
But state legislators and regulators reserved the first batch of cannabis retail licenses for applicants convicted of marijuana-related offenses, saying they want to give victims of the Drug War a chance to compete in the market rather than rely on it to let the big medicinal weed producers dominate.
But other advocates have complained, accusing the Hochul government of discriminating against disabled military veterans and other applicants — including medical marijuana operators — by giving convicted drug felons priority in obtaining cannabis sales licenses.
Albany State Supreme Court Justice Kevin Bryant last month issued an injunction blocking the issuance of further licenses, concluding that the state likely broke the law by giving convicted cannabis criminals preference over other applicants for social justice, including disabled veterinarians.
Bryant also said last week that he would not allow 23 vendors to be released from his recreational weed license freeze because OCM failed to demonstrate they met all the eligibility requirements to open their store.
Rules, approved by the state Cannabis Control Board in May, allow 10 medical marijuana stores to sell cannabis to the public, not just to sick patients, but only from December 30.
By June 30, 2024, another 20 marijuana stores may begin selling to the public.
Medical cannabis operators would also have to pay a $5 million royalty to expand and millions more based on revenue generated
Hochul’s office said it is reviewing the letter from medical cannabis operators.
“New York State is building the fairest adult cannabis market in the country, offering consumers high-quality, New York-grown, processed and tested products while addressing past mistakes,” said Hochul spokesman John Lindsay.
“Governor Hochul will continue her efforts to expand and improve the New York City cannabis market.”
The governor’s office noted that licensees have recently launched “Cannabis Growers Showcases” — similar to farmers’ markets — sanctioned by the Cannabis Control Board to help growers and retailers sell weed.
At the same time, the Hochul government, working with state and local law enforcement agencies, has stepped up its enforcement efforts, resulting in the seizure of significant quantities of illegally sold marijuana from unlicensed smoke shops.
