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Delays Loom For State Marijuana Program

It looks as if delays are coming to New York’s legalized marijuana program.

The end of the state’s legislative session on Thursday came and went without any appointments to the 13-member Cannabis Control Board nor an appointment to serve as head of the Office of Cannabis Management. The director of the Office of Cannabis Management is appointed by Gov. Andrew Cuomo and confirmed by the state Senate while seven members of the Cannabis Control Board are appointed by Cuomo and three each are appointed by the Senate and Assembly leadership. None of those appointments were made before the end of the legislative session. They won’t take place now until at least January unless the legislature returns for a special session.

Assembly Majority Leader Crystal Peoples-Stokes had previously estimated it could take 18 months to two years for sales to start, though many assumed that meant appointments to leadership positions would happen before the end of the legislative session. That timetable is likely not going to be met.

“I would be amazed if it goes as quickly and smoothly as they anticipated,” Asssemblyman Andrew Goodell, R-Jamestown, told The Post-Journal on Monday.

The Office of Cannabis Management will oversee medical and recreational marijuana sales as well as the state’s existing hemp and CBD businesses. The legislation establishes adult-use license categories of cultivator, processor, distributor, retail medical cannabis registered organizations vertical, RO cultivator, microbusiness, on-site consumption, cooperative, delivery and nursery. Microbusinesses are authorized to have complete vertical integration, which includes producing, processing, distributing and retail. An adult-use cultivator would be able to obtain one processor, one distributor and one nursery license. Register organizations would be allowed to, after paying a one-time special fee, apply for a vertically integrated adult-use cultivator/processor/distributor/retail license, limited to no more than three co-located dispensaries.

“It’s a heck of a lot more complicated than most people realize,” Goodell said. “New York’s system took something that was complicated and made it even more complicated, as you would expect. So rather than one or two or three licenses — you’d think we have a grower’s license and a distributor’s license, right? Oh, no no no. We have like a dozen difference types of licenses. So then you have to develop all the different strategies and procedures for all of them. That’s a lot of stuff.”

Aside from the Office of Cannabis Management, nominations to the state’s Cannabis Control Board haven’t yet been made either. That board is to be tasked with making sure the state’s social equity programs are carried out. Among its tasks are establishing a social equity plan, which includes issuing a goal of 50% of licenses to social equity applicants, especially those impacted by the war on drugs, those who are low-income, those who have a marijuana-related conviction, as well as minority and women owned businesses (MWBEs), distressed farmers and service disabled veterans.

State Sen. George Borrello, R-Sunset Bay, said he wonders why the state is doing so much work from scratch given New York is far from the only state to legalize marijuana sales.

“New York had the luxury of looking at 14 other states that went before us in legalizing recreational marijuana,” Borrello said. “We should’ve been able to take the best parts and cast aside the worst parts from each of them. Instead, the goal was to prove New York was the most progressive, or actually, the most radical.”

Local governments could opt out of retail sales. New York would set a 9% sales tax on cannabis, plus an additional 4% tax split between the county and local government. It would also impose an additional tax based on the level of THC, the active ingredient in marijuana, ranging from 0.5 cents per milligram for flower to 3 cents per milligram for edibles. The legislation would take effect immediately if passed, though sales wouldn’t start until New York sets up regulations and a proposed cannabis board.

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