New York is working to expand its regulated marijuana market. A new bill will empower local governments to close down unlicensed cannabis shops and seize the products.
The Assemblymember Jenifer Rajkumar’s (D) legislation aims to combat the proliferation of illegal operators who have appeared throughout the state as a result of the long-term implementation of New York’s legalization laws.
Currently, the Cannabis Control Board (CCB), a state regulatory agency, has enforcement authority over unlicensed businesses. The Stop Marijuana Overproliferation Act and Keep Empty Operators Unlicensed Transactions Act, which was recently filed, would extend this authority to local governments. Municipal officials would be able to “order an immediate closure of any businesses” found to sell marijuana illegally and seize their merchandise.
A memo explaining the bill states that “the lack of authority of municipalities to interdict illegal retailers, coupled with the limited resources of the Board, have resulted in a proliferation of so-called smoke shops” openly selling unregulated, illegal cannabis and other contraband, with almost total impunity.
The vast amounts of contraband, loose cash and other items in smoke shops make them tempting targets for robberies. They are also hotbeds for crime. This puts communities, employees and customers at extreme risk,” it states. These shops also compete unfairly with licensed dispensaries who can’t afford to sell their cannabis that has been rigorously tested and regulated at the prices offered by smoke shops.
New York regulators are currently processing hundreds of marijuana license applications. In December, over a dozen cannabis retailers opened after a settlement agreement lifted an injunction which had imposed months-long licensing blocks.
Governor Kathy Hochul (D) said at the time, “Our top priority to grow and expand New York’s legal cannabis industry is to crack down on illicit storefronts which continue to plague communities.” Kathy Hochul, a Democratic member of the Senate at that time, had stated this.
The New York Senate Cannabis Subcommittee was formed in April by Sen. Jeremy Cooney, (D) and has been chaired since then. In October, the Subcommittee heard testimony from witnesses, and discussed possible legislative solutions for the ongoing implementation problems of cannabis legalization in the state.
A report by the Office of Cannabis Management in New York (OCM) at the end of 2023 found that customers purchased over 3.5 million marijuana-related products. After December’s figures are added up, 2023 sales are expected to surpass $150 million.
OCM reported that the state had seized 11 600 pounds of illegal marijuana products valued at $56 millions. The state also conducted 369 “enforcement checks” on illicit operations.
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The state’s Department of Labor also published last month dozens of job descriptions for various positions in the legal cannabis industry. Officials said that the sample job descriptions are meant to streamline the hiring process and to allow potential employees to evaluate their qualifications in order to work in different roles within the industry.
Hochul signed a separate bill in November to provide tax relief to New York City marijuana businesses that are currently blocked from making federal deductions under an Internal Revenue Service (IRS) code known as 280E. She also signed a bill to give tax relief to New York City cannabis businesses who are currently barred from taking federal deductions due to an Internal Revenue Service code called 280E.
New York City’s tax laws were not affected by the change in Hochul’s budget bill of 2022, which included provisions allowing state-level cannabis businesses tax deductions. This new measure is intended to close that policy gap.
Hochul vetoed a bill that would have allowed Hemp seeds to be added to animal feeds for horses, pets and camelids like llamas or alpacas.
In September, about 66 state legislators–about one-third of the state legislature as a whole–also sent Hochul an email urging her to sign a law that would permit licensed marijuana producers to sell their products to tribal retailers . This plan would provide a way for cannabis farmers to release surplus product. Hochul, however, vetoed the bill last month.
State regulators also work to dispel what they call the false narrative that marijuana is often contaminated with fentanyl — a “misconception,” which is “widespread,” despite lack of evidence. OCM released a factsheet recently on the subject, stating that while fentanyl can be found in heroin and MDMA, the anecdotal evidence of marijuana being laced with fentanyl is unfounded.
The Office of Addiction Services and Supports also recently revised its guidance on THC testing in people receiving treatment for substance abuse disorder. It advises marijuana screening in cases when “the patient has indicated that a reduction or cessation of use of cannabis is part of their treatment goal.”
The Black Friday after Thanksgiving in November was a day when regulators encouraged consumers to shop at licensed cannabis retailers and take advantage of the specials.
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The first time Marijuana Moment published the article New York local governments could shut down unlicensed marijuana businesses under new ‘SMOKEOUT act’ bill.
