New York and New Jersey started out neck and neck on their paths to legalizing adult-use cannabis. Although New Jersey pulled ahead — and is set to announce the 2019 license application round winners at any moment — New York marijuana license applications are expected to follow shortly.
In New Jersey, all municipalities are opted in to the decision to allow cannabis in their towns by default, unless they decide to explicitly opt out. They have until August 21 to opt out. As we wait for more news from New Jersey, we can speculate that much of New York’s upcoming legislation will follow similar pathways.
Here’s what to expect in regards to the upcoming New York marijuana licensing options and how you can prepare to apply.
Legalization & Delays for New York Marijuana
New York marijuana legalization started with Governor Cuomo’s Cannabis Regulation and Tax Act at the beginning of the year. In March, Cuomo and the New York legislature agreed on the Marijuana Regulation and Tax Act, the main differences being related to taxes and social equity.
Similar to New Jersey, New York municipalities have until the end of the year to opt in or out of legalization. The tax part of the bill takes effect in April, so sales wouldn’t be able to begin until after that. From this, we can deduce that the application round is likely to happen between January and April.
However, with more potential delays due to Cuomo’s controversy and resignation, dates aren’t set in stone just yet.
New York Marijuana License Types
Once New York marijuana license applications open up, there will be a number of different types of licenses available, such as:
Additionally, New York will also be offering several unique and interesting license types, some of which are completely new.
The first of New York’s unique license types is the nursery license, which allows the license holder to produce plants — clones, immature plants, and seeds — specifically for cultivators, co-ops, and microbusinesses to buy.
A nursery license is different from a cultivation license in that the nursery would be a standalone provider of plants to cultivators, much like a wholesaler providing goods to a manufacturer.
A co-op, by definition, must be democratically controlled by its members on a basis of one vote per member, and must abide by seven cooperative principles set forth by the International Cooperative Alliance.
Interestingly, co-ops in New York must be owned by a New York resident. There may be a possibility for a workaround if you’re from out of state but filing in New York, but the parameters of doing so are still unclear.
A co-op license is almost like a built-in, vertically integrated license, since members of a co-op are allowed to cultivate, process, distribute, and sell from the co-op. However, the caveat is that they’re not allowed to sell directly to cannabis consumers. Instead, they can only sell to licensed distributors.
A microbusiness can be a processor, cultivator, distributor, and retailer. Usually, they have size limitations and are for state residents only.
The limitations for New York microbusinesses have yet to be clearly defined. But judging by what New Jersey has said, we can guess that the New York marijuana microbusiness license may be limited to around 1,000 plants and a handful of members.
On-Site Consumption License
There isn’t much available information about the New York marijuana on-site consumption license just yet, but parameters appear to be similar to Nevada’s upcoming consumption lounges.
On-site consumption businesses will, of course, face location and leasing restrictions. For example, a business can’t be vertically integrated or lease property from government agencies, and the property can’t be within 500 feet of a school. Also, only three on-site consumption licenses are allowed per individual investor.
More information on this license type should come in the future. For now, it seems likely that New York is waiting and watching Nevada to see how the consumption lounges work out before further defining the limits of the on-site consumption license.
Roadblocks to Success in New York
If you’re looking to apply for a New York marijuana license, it’s important that you solidify your property as soon as possible. New York is going to be very competitive, and finding property that works with setback regulations and other real estate requirements is going to be challenging.
Once New Jersey opens their application round, New York will feel the pressure to open up its licensing round soon after, so as not to fall behind and lose out on the market. That means the time to start preparing is now!
Make sure you work with a consultant who has a good understanding of application requirements so you have the best chance at success. Knowing what we do about New York marijuana licensing, the biggest mistake you can make right now is thinking you have time.
Get in touch with us today to start your strategic planning for how to best enter the New York marijuana market.