New York’s Cannabis Updates: Licenses and Social Equity Fund

Legalized cannabis in New York took a few more steps forward this summer. The Cannabis Control Board (CCB) and Office of Cannabis Management (OCM), which oversee licensing, opened applications for Adult-Use Conditional Processor Licenses. Additionally, these organizations are on the brink of issuing the state’s first Conditional Adult-Use Retail Dispensary (CAURD) licenses. Almost all the pieces are in place for New York cannabis retail sales to commence this fall.

Here we’ll review the latest developments in New York’s cannabis licensing process and the state’s social equity program.

 

New York Cannabis Cultivator Licenses Exceed 220

New York's Cannaibs Updates: Starting on March 15, New York hemp farmers got first dibs to apply for two-year licenses to grow the marijuana that will supply the state’s cannabis industry. The application window for this initial wave of Adult-Use Conditional Cultivator Licenses officially closed on June 30. As of the CCB’s recent meeting in July, which approved another 20 licenses, the state authorized 223 licensed cultivators to grow cannabis that contains over 0.3% THC.

With this total, New York’s cannabis industry appears on track to license between 100 and 200 retail dispensaries throughout the state. ​​According to the CCB, the OCM expects adult-use sales to begin through Conditional Retail Dispensary Licensees this fall—a huge piece of news considering the CCB has not issued any Conditional Retail Dispensary Licenses so far. However, regulators announced they’ll open Conditional Adult-Use Retail Dispensary applications later this summer at an undetermined date.

 

New York’s Adult-Use Conditional Processor License Applications

With the cultivator licenses wrapped up, the CCB addressed licenses for farmers and entrepreneurs who want to prepare, manufacture, and package cannabis. The application form for Adult-Use Conditional Processor Licenses went live on June 28. The OCM received 14 applications in the first week from manufacturers looking to process cannabis biomass into flower, oils, and other consumer products. This essential step links the cultivator licenses and the soon-to-be-issued retail dispensary licenses.

Here are a few key points regarding the Adult-Use Conditional Processor License process:

  • The application period will run from June 28 through August 31.
  • Licenses will be limited to those who applied for cannabinoid hemp processor licenses before January 1, 2022.
  • The conditional license is valid for two years, but licensees will have the opportunity to transition to a non-conditional license by meeting two requirements:
    • Participating in a mentorship program to provide pathways for social equity participants
    • Participating in an environmental sustainability program

       

Rules Surrounding Retail Dispensary License Requirements

The CCB climbed a significant hurdle to finally start rolling out its Conditional Adult-Use Retail Dispensary (CAURD) licenses.

To receive the license, applicants must:

  • Prove they’re “justice-involved” (meaning they or a family member were convicted of a marijuana crime—but not arrested—before March 31, 2021)
  • Have at least two years of experience owning a profitable business
  • Have at least a 51% stake in the cannabis business they’re looking to start
  • Submit a business plan, their fingerprints, and a $2,000 non-refundable fee

As part of the approval, the CCB expanded the definition of a qualifying “justice-involved” individual to include people who were arrested for marijuana but convicted for a lesser offense.

An online application portal will likely go live in August 2022. The OCM will post the opening date for the portal on its website at least 14 days before the application period opens.

 

New York’s Social Equity Cannabis Investment Fund

New York's Cannabis Updates: New York’s Seeding Opportunity Initiative, designed to place individuals affected by prior cannabis-related offenses at the forefront of the state’s cannabis supply chain, took another critical step forward with its Social Equity Cannabis Investment Fund. The fund will help those with CAURD licenses lease and equip retail dispensaries, including designing, constructing, and building the spaces. The fund will consist of up to $50 million in licensing fees and revenue from the adult-use cannabis industry and up to $150 million from the private sector that the fund manager will raise.

In May 2022, the Dormitory Authority for the State of New York (DASNY) requested proposals seeking a fund manager to sponsor and manage the $200 million fund. The management team was officially selected last month. It includes Chris Webber, a five-time NBA All-Star, and Bill Thompson, the 42nd Comptroller of New York City.

Scouting for storefront locations is already in progress. Now, with the managers in place, fundraising for the program’s retail dispensary locations will occur over the next 60 to 90 days. All that to say, Fall is a reasonable timeframe for New Yorkers to expect legal marijuana sales to occur.

 

 

The bottom line

New York’s Seeding Opportunity Initiative achieved several critical milestones this summer. Applications are open for those interested in processing and distributing cannabis products, and the application portal for retail licenses could open next month. Now that the Social Equity Investment Fund has a management team, those affected by cannabis-related offenses can get the money they need to lease and outfit the state’s first retail dispensaries in time for sales to go live this fall.

Medical Mike’s is keeping up with all cannabis news in the Northeast states, so check weekly for updates on New York’s cannabis sales and regulations.

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