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New York opens licensing process for retail cannabis, those impacted by prohibition are first in line

Cannabis plants grow in the greenhouse at Vireo Health's medical marijuana cultivation facility on Aug. 19 in Johnstown, N.Y.
Drew Angerer
/
Getty Images
Cannabis plants grow in the greenhouse at Vireo Health's medical marijuana cultivation facility on Aug. 19 in Johnstown, N.Y.

New York state has begun the application process for licenses to run retail cannabis stores, nearly one and half years after the drug became legal for adult recreational purposes. New York has a different approach than other states that have legalized marijuana, and is emphasizing social and economic equity.

The first round of 100 or so licenses will be reserved for those who were harmed by the decades of marijuana prohibition. Applicants or one of their close family members, must have a cannabis related conviction in order to qualify. Damian Fagan, Chief Equity Officer for the state’s Office of Cannabis Management, said the aim is to help reverse a “dark history” of the hemp plant in New York and to give those in communities adversely effected a chance to get in the “ground floor” of a profitable industry.

“We are here today to make sure those New Yorkers who saw their futures ruined because the government got it so wrong, are now at the front of the line to benefit when the government gets it right,” Fagan said.

Applicants also need to have experience running a business that can show at least two years of profitability. They also must have when the regulations describe as a “significant presence” in New York, having assets like vehicles and real property, a state-based residence and a bank account. Credit checks won’t be required.

OCM executive director Chris Alexander said financial help will also be provided to those who are granted the licenses, including helping them lease or purchase store fronts in competitive locations and create a desirable retail space.

“We’re supporting our entrepreneurs with capital, with real estate and with a real opportunity to build a brand, build a customer base,” Alexander said. “And really get their businesses off the ground in the right way.”

The money comes from a $200 million dollars equity fund included in the 2021 legislation that legalized adult recreational use of cannabis. The industry is expected to generate $4.2 billion dollars in the next five years and create up to 60,000 jobs.

The state has already distributed licenses to 52 farmers to grow hemp for retail use.

Gia Moron is the President of Women Grow, a female focused nonprofit promoting equity for Black and Brown people in the cannabis industry.

“Our community of women and small business are thrilled,” Moron said. “We’ve been waiting for this day.”

The OCM officials did not address tax obstacles that small cannabis business owners might face, including not being able to deduct business expenses from their federal taxes, since cannabis is still considered illegal by the federal government.

The licenses will be distributed regionally, in areas defined by state’s Empire State Development Corporation as part of their economic development grant programs.

Applicants have until September 26 to get their request completed.

Those who don’t want to run a business but want to grow cannabis at home will have to wait awhile before learning the rules for private cultivation. Alexander said the Office of Cannabis Management is still finalizing rules for medical marijuana patients who want to grow at home. He could not offer a timetable for recreational users who want to grow their own plants.

Karen has covered state government and politics for New York State Public Radio, a network of 10 New York and Connecticut stations, since 1990. She is also a regular contributor to the statewide public television program about New York State government, New York Now. She appears on the reporter’s roundtable segment, and interviews newsmakers.