NY missing out on ‘pot’ of gold
Laws restrict state revenues: report
New York isn’t high on the list of states making money when it comes to harvesting revenues from legal weed sales.
The Empire State is not even on track to make a predicted $56 million in its first year of legal weed sales — and that’s just a fraction of what other states made after legalization, according to a report backed by New York medical marijuana operators.
“The current state of the cannabis market in New York is an unmitigated disaster,” said the Rev. Kirsten Foy from the Coalition for Access to Regulated and Safe Cannabis.
The report highlights criticism from the industry that state cannabis laws are too restrictive for legal weed vendors while allowing an illegal market to flourish.
New York legalized recreational marijuana in the 2021 Marijuana Regulation and Taxation Act, which prioritized retail licenses for people who were previously hurt by prohibition such as those previously incarcerated for marijuana-related offenses.
“Despite its enormous potential, regulators have neglected their responsibilities and their failure to act puts consumers at risk, restricts equity participation and the MRTA’s intended beneficiaries — disproportionately impacted communities — are missing out on millions of dollars of critical tax revenue while putting consumers at risk,” Foy said.
$1.25 billion sought
Gov. Hochul earlier this year projected $1.25 billion in revenues from a legal weed market over the next six years with $56 million in revenues from the first year — $40 million of which would come from licensing fees rather than sales taxes.
But that goal might not be met considering only 15 dispensaries are up and running statewide after legal sales began in December while hundreds of illegal storefronts continue to flourish in New York City.
In any case, the report notes that New York remains far behind eight other, mostly smaller, states when it comes to first-year revenues:
California: $397 million
Illinois: $216 million
Washington: $159 million
Arizona: $153 million
Nevada: $120 million
Michigan: $82 million
Oregon: $68 million
Massachusetts: $62 million
New York will likely land just ahead of Colorado and Montana, which raised $46 million and $42 million, respectively, in their first years despite having much smaller populations.
A spokesman for the state Office of Cannabis Management could not be reached for comment.
The state agency and the Hochul administration have made several moves in recent months to address outstanding criticism.
Recent raids on illegal dispensaries came after the governor successfully secured changes in the state budget that empowered the OCM and the state Department of Taxation and Finance to fine sativa-selling scofflaws up to $20,000 per day. A regulatory change will allow 10 medical marijuana operators to begin sales to the general public by the end of this year.