Cannabis Business Diversity in New York

With the legalization of recreational cannabis, New York is poised to become one of the top cannabis markets in the country.

Taking into account the diversity in New York where over a fourth of the population is African American and another fourth Hispanic, it’s not surprising that the state has one of the strongest social equity aspects to its new cannabis law in the country.

New York plans to allocate 50 percent of the cannabis licenses for social equity applicants.

While the social and economic equity program is designed to help people disproportionally impacted by cannabis enforcement, it’s also aimed to help minorities, women, disabled veterans and distressed farmers gain a foothold in the cannabis industry. The new program will offer low-or zero-interest loans and an incubator program to individuals from minority communities, giving them financial assistance to get a foothold in the industry.

Additionally, preference will be given to applicants who:

1. Are a member of a community disproportionately impacted by the prior enforcement of cannabis prohibition.
2. Have an income lower than 80 percent of the median income in the county, which they reside.
3. Were convicted of a marijuana offense, or had a close family member convicted.

The law is not only designed to get minorities involved in the industry but also to  have the tax revenue benefit Black and Latino communities. Forty percent of the tax revenue will be earmarked for those populations.

Recreational Program Overview

When New York was limited to medical marijuana the only type of cannabis license issued was a vertically integrated grower/dispensary license, but with the new recreational market, the state plans a two-tier structure similar to what’s found in the alcohol industry.

In general, vertical integration will be prohibited. Applicants can seek a cannabis license for cultivation and processing or for distribution/retail. Retail applicants will also be limited to direct or indirect ownership in three retail outlets. For companies that already hold a vertically integrated medical marijuana license there will be an exception allowing them to remain vertically integrated on the adult-use side as well. This year there will be no delivery licenses issued requiring all cultivators to sell adult-use products through a licensed dispensary.

The Office of Cannabis Management (OCM) will oversee the program and will be governed by a five-person Cannabis Control Board, appointed by the governor. The OCM will be responsible for setting the number of recreational marijuana licenses, the process to obtain a license and the details for the social equity license program.

We have successfully secured licenses for clients in over 20 markets across the United States. If you are interested in applying for a dispensary license, contact us by phone at (602)-290-9424‬ or email (info@thecannabisbusinessadvisors.com) for more information.