N.Y. cannabis market remains a work in progress

Five years after New York legalized recreational marijuana, the state’s legal cannabis market continues to grow, but some of the issues that complicated its rollout remain unresolved. 

The state is still fighting an illicit cannabis market, community reinvestment money is still making its way to communities disproportionately impacted by past drug enforcement and New York has continued making changes to its regulatory system. 

Now, one of the lawmakers most closely tied to legalization is preparing to leave Albany. 

Assembly Majority Leader Crystal Peoples-Stokes, D-Buffalo, helped write the Marihuana Regulation and Taxation Act, or MRTA, which legalized adult-use cannabis in New York in 2021. 

Peoples-Stokes defended the progress made by the state’s Office of Cannabis Management, while acknowledging that building the regulatory system has taken time. 

“It took time to figure it out,” Peoples-Stokes said. “And then once you did get to figure out, you had to go to court because people challenged that. They didn’t challenge necessarily the law. They challenged the regulation that would implement the law.” 

A central goal of MRTA was ensuring that people and communities disproportionately impacted by cannabis prohibition had an opportunity to participate in the legal industry. 

That work is continuing five years later. 

New York’s Community Reinvestment Program directs cannabis tax revenue toward communities disproportionately affected by previous state and federal drug policies. The second round of the program includes $15 million in available funding, up from $5 million in the first round. Award notifications for the latest round are expected later this month. 

The state has also had to make other adjustments to the regulatory system. Earlier this year, a correction took effect addressing how proximity requirements for cannabis businesses near schools and houses of worship were applied. 

Republican state Sen. George Borrello, who sits on the Senate Cannabis Committee, argues those problems cannot all be attributed to implementation. 

Borrello voted against MRTA in 2021 and said the problems New York is confronting today are similar to concerns he raised when lawmakers considered the legislation. 

“Well, exactly what I predicted has happened,” Borrello said. 

He specifically criticized the decision to legalize possession before New York had a regulated retail market operating. 

“You legalized the possession of illegal weed on day one, two years before the market even sold its first legal cannabis,” Borrello said. 

Peoples-Stokes has compared the development of New York’s cannabis industry to the regulation of alcohol, arguing that establishing a new legal market takes time. 

When asked to respond to that comparison, Borrello said New York should regulate cannabis more like alcohol. 

“If you would have handled marijuana the same way we handle alcohol, we’d be okay,” Borrello said. “You would have restrictions on where you can consume it, who can sell it. You would have stricter controls and you would have real enforcement.” 

The state Office of Cannabis Management pushes back on the idea that legalization created New York’s cannabis market. 

OCM Executive Director John Kagia said an extensive underground cannabis economy existed in New York long before MRTA became law. 

“What we’re trying to do is transitioning the very large, multibillion-dollar cannabis economy that already exists into a legal framework,” Kagia said. 

The debate over the future of that system will soon continue without Peoples-Stokes casting a vote in the Assembly. 

She announced earlier this year that she will not seek reelection and will leave the Legislature at the end of her term. 

Peoples-Stokes would not name a single lawmaker she expects to take over her role on cannabis policy, but said there are several colleagues she trusts to protect the intent of MRTA. She also pointed to state Sen. Liz Krueger, the Senate sponsor of MRTA, who is seeking reelection this year. 

Peoples-Stokes said her own involvement will not end when she leaves the Legislature. 

“I had created an Equity PAC, which I will maintain,” Peoples-Stokes said. “And the purpose of that is to try and help elected officials who believe in adult-use cannabis the way I do as an economic opportunity for communities.” 

There is also at least one cannabis issue Peoples-Stokes says she will be watching when lawmakers return to Albany. 

A bill that passed both chambers this session would create a Cannabis Industry Wage Board and require cannabis businesses to publicly report pay ranges for different positions. 

Peoples-Stokes said she opposes that reporting requirement and does not believe privately owned businesses should be required to make that information public. 

While Peoples-Stokes will no longer have a vote in Albany after this year, she made clear she does not plan to leave the cannabis policy debate behind.