New York Governor has vetoed a bill that would have permitted licensed marijuana growers to sell their products to tribal retailers .
The bills sponsored by Sen. Michelle Hinchey, (D), and Assemblywoman Donna Lupardo, (D), respectively, who chair the state Senate agriculture committee and Assembly agriculture, would have provided a release valve for hundreds of cannabis growers who were sitting on surpluses and had no place to sell them.
In a reaction to the veto, Hinchey and Lupardo stated that they had “offered a way to sell some of the excess cannabis grown by NY farmers to NY’s Tribal Nations.” The veto was not surprising, given that the temporary measure had expired on December 31, anyway.
Both chambers of the Legislature passed these bills in June. However, they were not officially transmitted to Governor. Kathy Hochul (D), this month. She vetoed the bills on Friday.
The sponsors stated that “Many of our farmers are still financially ruinous due to circumstances beyond their control.” “We remain committed in every way possible to helping the farmers, and processors, on which the legal cannabis industry in NY depends.”
Hochul’s didn’t immediately reply to Marijuana Moments’ email Saturday asking for comment on her veto of the legislation.
Sixty-six legislators, or about a third of state lawmakers, sent a letter to the governor in September urging him to sign the bill.
In an open letter addressed to Hochul, the Senate and Assembly bipartisan members stated that “there are currently over 200 cannabis growers trying to sell their crop but only 23 dispensaries have opened statewide.” This has led to more than 250.000 pounds of cannabis remaining unsold. Farmers who borrowed money and used all of their assets to grow these crops face financial ruin if we don’t act fast to find them an alternative market.
S.7295/A.7375, entitled the “Cannabis Crop Rescue Act,” provided growers another legal avenue for offloading products amid lawsuits, other delays and bottlenecks that have caused a legal marketplace which opened officially last December.
The letter stated that “regulation delays, litigation, logistical and financial challenges, and state timelines and goals have been missed,” The letter said that “Cultivators are paying the highest price.”
The letter was signed by Crystal People-Stokes, the Assembly Majority leader (D), and Liz Krueger, Chair of the Senate Finance Committee (D), both of whom are co-sponsors of New York’s marijuana legalization bill. Jeremy Cooney, a Democratic senator who chairs the Senate’s subcommittee for marijuana, was also listed.
The lawmakers stated that “New York’s Cannabis Farmers, who took a risk to help establish the legal market in the state, shouldn’t be facing financial ruin due to regulatory delays.” “We should give them every opportunity to remain afloat as they wait for the development of the legal market that was promised,” the lawmakers said.
This letter was sent just weeks after four prominent lawmakers released a separate statement in which they urged Hochul to sign. Hinchey, Lupardo and the top members of the agriculture committees (Sen. George Borrello and Assemblyman Chris Tague) signed the letter. The new letter was also signed by all four legislators.
In an earlier statement, these lawmakers stated that “while lawsuits are being litigated” and “illegal stores are flourishing”, NY’s marijuana farmers are suffering. “Crops were planted last year in the expectation that there would be an available legal market to sell them… We urge the governor to sign this temporary solution that will provide some relief to what has quickly become an agricultural crisis.”
Despite the state’s rocky rollout, more licensed retailers are opening. Hochul and officials have said that more cannabis stores will be opened in this month as well as the new year.
Despite the fact that there are few retail outlets, marijuana growers and processors still struggle to sell millions of dollars worth of products. During a state Cannabis Control Board meeting in September, growers claimed they had poured their entire money into their cannabis farm only to see the surplus product rot. One grower even mentioned suicide.
In a sponsor memo that was attached to the bill , which has now been vetoed, acknowledges the fact that conditional cultivation licences were initially issued with the understanding that “growers would not be allowed to sell their products outside of the state borders but that a vibrant state market would exist throughout the conditional licensing timeframe.”
Many licensees, who are in severe financial distress, are unable sell their product. They will also be unable to plant a crop this growing season. Many are in financial trouble and won’t be able to plant a harvest this season because they can’t sell their product.
The sponsor memo states that allowing growers and processors the opportunity to sell to tribal nation retailers “protects New York’s cannabis industry including distressed growers to ensure a local cannabis economy in the future.”
Since New York legalized marijuana in march 2021, tribal governments have been ahead. Later that year , the Saint Regis Mohawk Tribe approved the first adult-use licensing applications.
In an effort to help producers find legal ways to offload their products and to increase consumer access to marijuana, the New York Office of Cannabis Management’s (OCM) regulators also launched the Cannabis Growers’ Showcase program that allows licensed growers to sell directly to customers.
approved the program by a vote in July, and quickly began accepting applications. On August 10, the Hudson Valley hosted its first pop-up. Another was held near the state fair.
In September, regulators approved a plan to open up the adult-use marijuana industry in the state to more businesses. The changes will also enable the few large medical marijuana providers in the state to start selling adult-use cannabis 2 years earlier than originally planned.
This move, while it could speed up the market rollout in the end, also caused outrage among small business owners, social equity licensees and other stakeholders. They claimed that they had been promised time to set themselves up before being forced to compete against large multi-state operators who have far greater financial resources.
The New York Senate Cannabis Subcommittee was formed in April by Sen. Jeremy Cooney, (D) and has been chaired since then. In October, they heard from witnesses, and discussed possible legislative solutions for the ongoing problems with the implementation of cannabis legalization in the state.
Hochul signed a bill that makes it easier for financial institution to work with clients licensed to grow cannabis.
She also signed another bill intended to provide tax relief for New York City cannabis businesses, which are currently prevented from making federal deductions due to an Internal Revenue Service code (IRS), known as 280E.
Hochul had signed an earlier budget bill in the past year which included provisions that allowed state-level cannabis businesses to deduct tax — a partial remedy for the ongoing federal problem. However, New York City’s own tax laws were not affected by this change. This new measure is intended to close that policy gap.
The governor, however, vetoed two bills in this month which would have permitted hemp seeds to be added to animal feed for horses, pets and camelids , such as llamas, alpacas, and camels . She cited a lack information about safety, and demanded that the state study such uses in a “rapid manner.”
As more states legalize marijuana, some tribal governments have entered the business. Notably, in Minnesota, where state lawmakers passed an adult-use marijuana program earlier this year, tribes are leading the way.
White Earth Nation, which also began sales in August, recently announced plans to launch a mobile marijuana retailer. And the Red Lake Nation, which also began sales in August, recently announced plans to launch a mobile marijuana retailer–effectively a cannabis “food truck” that can travel and do business on tribal land throughout the state. The Leech Lake Band of Ojibwe is another tribe in the state that’s also moving towards legalization.
Minnesota’s marijuana law allows the governor to enter into agreements with tribal governments that allow them to operate in non-tribal areas of the state. This option has been seen as a means to sell legal cannabis before the state license, which is expected in 2025. The cannabis regulators said that “several tribes” have shown interest in this arrangement.
The Eastern Band of Cherokee Indians in North Carolina voted to legalize cannabis for adult use, even though the state continues to ban all forms of marijuana.
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Photo by Brian Shamblen.
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