New York issued its first retail cannabis licenses last month, leaving many to wonder: How long until you can buy it in the store?
At a November 21st meeting, the state Office of Cannabis Management’s Control Board approved 28 business applicants and eight non-profit applications from a pool of more than 900. The first licenses are going to applicants who were convicted of a marijuana-related offense before the legalization of recreational marijuana went into effect and also showed they have run a successful business.
One of those licenses went to Don Andrews. He opened VapedCity in Schenectady in 2012 and later launched two other stores in the county. He says he traveled to states where cannabis was legalized before New York and learned it helped his arthritis. He says he wanted to sell it others to help them, as well.
“That's kind of been a big dream of mine to own and operate and run a dispensary like how those are (run) on the other side of the country.”
But Andrews and other retail licensees who already own smoke shops are still waiting to sell cannabis at their existing stores. The retail licenses were issued under the state’s Conditional Adult-Use Retail Dispensary or CAURD program. Under the program, retail licensees must work with the state Dormitory Authority to create turnkey stores to sell cannabis in-person. Andrews isn’t sure when that will happen.
“They said there would be turn a turnkey storefront ready for us sometime in the foreseeable future, I'm not too sure when. But, they did say sometime in the future that we would be getting a location to where we have to run our operations out of.”
Control Board Chair Tremaine Wright says the goal is to help speed up the process to meet the state’s aim of starting cannabis sales by the end of the year.
“It is a wraparound program where they're providing support for build-out, design, as well as loan dollars for these new retail operations. And they're also helping with site selection. So, this is a very limited scope. This is not the regular adult-use license that will allow a retailer to just incorporate cannabis into an existing business.”
Those licenses will be issued starting next year. In the meantime, Andrews says everyday people are confused.
“A lot of people are already walking into the stores we currently have - because we have three locations – so, we get a lot of people walking every day, quite a few people walking in every day, thinking they can purchase. But, that's not the case. We kind of just tell them to keep giving us a call, keep checking back, keep popping back in just to kind of stay informed with everything.”
Wright, a former state Assemblywoman, agrees there is lack of clarity so far.
“There is, because (when) we talk about cannabis and the public, many people don't have the bandwidth to really delve in, because it's just news to them and they're not involved in it.”
Further complicating the rollout is a lawsuit filed last month arguing the state’s law violates constitutional commerce protections because it favors New York residents over out-of-state residents.
That’s holding up 63 of the eventual 150 licenses, including some in the Hudson Valley. Because of the lawsuit, the board is not yet approving retail licenses in the Finger Lakes, Central New York, western New York, the mid-Hudson Valley and Brooklyn.
Wright notes the lawsuit only impact retail licenses issued under the CAURD program.
“That does not stop or inhibit us from moving forward with our general adult-use regulations, which we just issued (in) our regulatory package last week at the board meeting. It is open for a 60-day comment period. So, we hope people are really reading them, taking a look at them, getting to know and understand sort of what we're projecting, so that it gives them some guidance and structure as they are planning their new businesses.”
An OCM spokesperson clarified to WAMC the farmers, processors and retail licensees will not have to re-apply for the general adult-use program. As 2023 quickly approaches, farmers who already harvested their crops are nervous about it going bad before it can hit the stores.
Alex Keenan is co-owner of cannabis farm Mystic Meadows in Hopewell Junction – one of the areas impacted by the lawsuit. He said there is nothing else stopping them from being able to sell their crop to retail stores moving forward.
“We'd love to be able to sell our product to some local shops, but we're looking for silver linings here and we are very close to (New York City) and there are going to be dispensaries there. So, we'll be OK in the in the short term and we just hope this lawsuit gets resolved quickly so we can start selling in our backyard.”
But, given the small number of retail licenses so far, they could still face losses.
“I think there's definitely too much product right now for the for the 36 that got licensed. I think that as they bring more online, because they're going to come up to 150, probably not. There's probably not enough product.”
Another concern is the illegal market.
“Well, we've got kind of a third gray market now. I don't think you're ever going to get rid of the black market altogether. Just like I don't think you'll ever get rid of the gray market. I mean, there's still a gray market for cigarettes, right? But, certainly, with marijuana possession not being enforced, I think the gray market has been able to kind of just skate under the radar. So, it's a threat that could really take a foothold very quickly. And that's what causes us concern.”
Wright said the state is aware of the problem and is working with multiple state agencies and law enforcement partners to crack down. OCM also recently announced it will allow for the delivery of cannabis by the retail licensees while the stores are being set up, but it is unclear how that will work. Andrews was hoping to hear more details this week.
“I guess it's just kind of like the waiting game, where we're kind of waiting to see what to do. They did tell us to submit the car registrations and car insurance for the vehicles that are going to be used for the delivery service. But, that's literally all they asked for. They haven't really given us much as anything.”
For now, patience appears to be the name of the cannabis industry game.
