Opt-In vs. Opt-Out: New York Local Cannabis Laws

Opt-In vs. Opt-Out: New York Local Cannabis Laws 

In March, New York became the 17th state to legalize adult-use marijuana under the Marijuana Regulation and Taxation Act (MRTA). The market is projected to accrue nearly $2.5B in sales by the fourth year of the program.

Though still undetermined, New York may require cannabis business applicants to secure real estate before issuing licenses, which would mean they would need letters of intent, a draft lease or ownership of the property.

In preparation, investors are eyeing real estate to capitalize on market opportunities, especially companies that already operate medical marijuana facilities in New York and MSOs.

Opt-Out Rules in New York

Cities, towns, and villages in New York have the ability to “opt-out” of hosting adult-use retail dispensaries and/or public consumption facilities (cannabis bars) within their borders. This does not mean municipalities can opt-out of adult-use legalization in regards to cannabis possession and use by adults 21 years of age or older.

Currently, no municipalities have opted-out yet, but they only have until December 31, 2021, to make a decision and must pass a local law by that date. If a municipality decides to opt-out, the Office of Cannabis Management will be prohibited from issuing a license for a facility in that municipality in the future.

Additionally, municipalities have the control to pass laws and regulations pertaining to local zoning and location of cannabis licensees, hours of operations, and local building codes. Voters of a municipality have the ability to petition the outcome of a local law. Any local laws restricting cannabis sales must also be approved by voters in a direct referendum.

Opt-In Rules and Other Scenarios

If a New York municipality does not opt out by December 31, 2021, they will not be able to opt-out in the future. There is a caveat though for opt-out municipalities. Cities, towns, and villages have the ability to opt back in to allow either, or both adult-use retail dispensaries or onsite consumption licenses by repealing their local law.

Types of Municipality Ordinances

Municipalities can take several approaches to adult-use marijuana through the type of ordinance they issue.

• An ordinance that bans all marijuana businesses
• An ordinance that would allow for all types of marijuana businesses providing they meet zoning regulations, building codes and other relevant regulations
• An ordinance that limits the number and/or type of marijuana businesses

How Stakeholders Can Prepare for Local Rules in New York

With municipalities able to opt-in or opt-out in New York, cannabis investors and entrepreneurs should discuss real estate strategies with a cannabis consultant. If you’re interested in entering the New York recreational marijuana market, contact the CB Advisors team today to develop your licensing plan and approach.

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