Gov. Andrew Cuomo announced Wednesday his proposal for a legal cannabis program across New York State.
The plan calls for a new Office of Cannabis Management. This group would oversee a nascent recreational program as well as New York’s current medical marijuana program.
The proposal, according to the Governor’s press office, would allow adults over the age of 21 to buy marijuana at state-approved dispensaries.
The goal is to generate roughly $300 million in tax revenue from the legalization effort and bolster state coffers, which took a hit due to the effects of the COVID-19 pandemic.
I’m announcing a proposal to legalize cannabis and create an equitable adult-use cannabis program in NYS.
This program will generate much-needed revenue, while allowing us to support those that have been most harmed by decades of failed cannabis prohibition.#SOTS2021
— Andrew Cuomo (@NYGovCuomo) January 6, 2021
The news also bodes well for several mutli-state operators, or MSOs, that do business in New York. They include:
- Cresco Labs (OTCQX:CRLBF), which has at least four New York-based dispensaries under the Sunnyside banner. It also has the right to operate one cultivation facility.
- Columbia Care Inc. (OTCQX:CCHWF), which also owns four New York dispensaries.
- Acreage Holdings (OTCQX:ACRDF), which is based in New York and has four brands under its umbrella, including the Botanist, Prime, Natural Wonder and Live Resin Project.
Adult-use cannabis legislation was in the works in 2019 but failed to pass due to a series of legislative hurdles and revenue allotment. That year, Cuomo signed a bill that decriminalized cannabis use in New York, reducing unlawful possession to a finable offense.
The bill also removed all criminal penalties for possession of two ounces or less of marijuana. The bill also established an expungement process for marijuana offenses for possession of small amounts.
The move was geared toward helping communities of color that have been “disproportionately impacted by laws governing marijuana,” Cuomo said at the time. “By providing individuals who have suffered the consequences of an unfair marijuana conviction with a path to have their records expunged and by reducing draconian penalties, we are taking a critical step forward in addressing a broken and discriminatory criminal justice process.”
Where We Are Now
Under the current medical cannabis program, New York has “one of the most restrictive programs in the nation and access is severely limited.” That’s according to Gretchen Schmidt, faculty program director of criminal justice programs at Excelsior College in Albany, who spoke to Benzinga in August 2020.
The lack of dispensaries across the state impacts access, especially in rural areas, she explained.
“The highly regulated nature of the state also increases price, in part driven by costly production involved in meeting the state’s medical quality standards, but also the lack of demand caused by hurdles to patient certification,” she said.
Cuomo is expected to discuss the recreational cannabis program at length during his annual State of the State on Jan. 11.
The event, Cuomo’s 11th, will be virtual, and lay out his goals for the upcoming legislative session.
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