Last week, New York Gov. Kathy Hochul presented an election year agenda with more than 200 proposals to make the state safer, more affordable and more liveable. One of those proposals includes plans to crackdown on stores selling cannabis without a license.
“The governor has somewhat taken a few different positions in order to do this,” states Ryan McCall, a cannabis law attorney in Tully Rinckey’s Albany office. “Originally, the state just wanted to shut down all of the illegal selling spots and seize the cannabis. Governor Hochul also said that she would prosecute these people, but that stalled.”
So the new plan is to enforce more of a crackdown on these shops selling marijuana without a retail license. McCall hopes that New York will officially start rolling that plan out this year.
Eradicating New York’s Illegal Market
This New York of the State Address comes after City Council Majority Leader Keither Powers introduced new legislation back in November 2023 that would make it easier to close illegal cannabis shops. According to Tully Rinckey, the legislation amends the city’s Nuisance Abatement Law to make it easier to shut down the shops by expediting closures.
Most likely due to the seemingly never-ending period of time between legalizing adult-use cannabis and actually opening up license applications, New York has been trying to tackle the illegal pot market for quite some time. Hopefully this time they mean business.
“With the additional authority that the governor has proposed, we’ll also have new tools to tackle the illegal smoke shops that have popped up on too many corners in our city, giving up the opportunity to get cannabis right in the five boroughs,” New York City Mayor Eric Adams said in a statement.
Distributing More Adult-Use Licenses
McCall explains that the black market essentially exists when weed can’t be purchased legally. And currently, New York still doesn’t even have 50 legal dispensaries.
“So if they can issue 4,000 to 5,000 new licenses this year, and if we can get a fraction of those dispensaries open, you will see the black market take a step back,” he says. “What will be difficult is figuring out the difference between a legal and illegal dispensary.”
Even with more adult-use licenses being distributed, it’s still a tough call on whether or not the black market will be eradicated because currently, all of the illegal shops aren’t paying taxes on the cannabis they sell. The profits are high for black market businesses and there are abundantly less hurdles to jump through.
But by closing these illegal dispensaries and seizing their products, change may very well happen.
“I think Governor Hochul’s plan definitely has a shot,” McCall says. “This time around, they have attempted to say ‘OK, let’s do what we can to help the other dispensaries that are open,’ and that is the best way — to get as many stores open as people are able to and stop the illegal dispensaries.”