NY Cannabis Control Board Takes Significant Step Towards Social Equity

On March 10, 2022, the New York Cannabis Control Board adopted a resolution to file proposed conditional adult-use retail dispensary regulations with the Secretary of State.  This is a significant step towards licensing retail dispensaries because once filed, there will be a 60-day comment period, and soon thereafter the rules can become final.  Once the rules are final, the Office of Cannabis Management can begin accepting applications for retail dispensary licenses.

If adopted, New York’s rules would be the first in the country to specifically require applicants to either be majority owned by persons with prior cannabis related convictions or be non-profit entities.  The rules were intentionally designed to help promote the goal of New York’s legalization law to award 50% of all licenses to equity entrepreneurs, and to give those people directly impacted by the war on drugs a head start in the industry. 

The rules would require that one person who is a qualified “justice involved” person own at least 30% of the for profit applicant and have sole control of the applicant.  A qualified justice involved person is someone who was convicted of a cannabis offense in New York or has an immediate family member who was convicted of a cannabis offense in New York, and owned at least 10% of a business, and had control of a business, that had a net profit for at least 2 years. 

In other words, the applicant must be controlled by a successful business owner who also has a personal or family history of cannabis convictions.

The applicant entity also must be owned at least 51% by persons with New York cannabis convictions or whose family has New York cannabis convictions.

Executive Director, Chris Alexander, stated that New York expects that justice involved applicants will be able to submit applications in July of this year.

People who do not meet those criteria will have to wait until New York releases its other cannabis regulations, which are expected to be proposed in May.  The Executive Director stated that he expects other, non -justice involved, applicants will be able to submit applications before the end of 2022.

  • Sean  Mack

    Sean Mack is the co-chair of the firm's Litigation practice and chair of the firm’s Cannabis & Hemp practice. He also serves as a member of the firm's Executive Committee. Clients turn to Sean for his steadfast guidance, sincere ...

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