New York State took a significant step forward in expanding access to legal cannabis on Monday, April 3rd when 99 new adult-use cannabis retail licenses were issued. This is the first time retailers have been allowed into the critical market of Brooklyn since an ongoing lawsuit blocked their entry last year.
The Conditional Adult-Use Retail Dispensary (CUARD) licenses have opened up the opportunity for businesses that had previously been unable to participate in New York’s regulated cannabis market.
It follows a ruling from the U.S Court of Appeals for the 2nd Circuit, which lifted a temporary restraining order in four state regions – including Brooklyn, Central New York, Mid-Hudson, and Western New York – allowing regulators to start issuing social equity licenses.
The move has provided a massive boost for many businesses that had been unable to start their buildouts and launch plans due to the court case, which Michigan man Kenneth Gay brought on behalf of his marijuana company Variscite.
The injunction against licensing remains in place in the Finger Lakes region, but this ruling still represents a significant expansion in access to legal cannabis throughout New York State.
The illegal marijuana market in New York City is a significant problem for the state and its legal cannabis industry. While adult-use sales were set to begin on March 31, 2021, an estimated 1,400 unlicensed stores are actively selling cannabis products with no regulation or oversight.
These shops operate outside the law and undercut regulated businesses by offering lower prices due to their lack of compliance costs. Moreover, they pose a significant risk to public health by failing to adhere to safety protocols such as testing products for contaminants and providing accurate labeling information.
This unchecked expansion of the illicit market creates unfair competition that legal cannabis retailers struggle to keep up with. It also reduces tax revenue earned from these businesses since they do not pay taxes on their sales.
The New York Cannabis Control Board hopes that issuing new CUARD licenses will help legitimize the market and make it more difficult for unlicensed stores to operate. In addition, by increasing the availability of legal cannabis products, they hope to reduce demand for illegal sources while providing a safer and more controlled environment for buyers.
With 165 licenses now issued, this is undoubtedly a step in the right direction toward combating illegal cannabis sales in New York City.
It is hoped that this will further increase opportunities for communities that have long been disproportionately affected by the criminalization of cannabis, allowing them to benefit from the rapidly developing industry.
With more licenses coming online in these regions soon, there’s sure to be an exciting future ahead for those involved in New York’s legal cannabis.
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