New York Set to Legalize Adult-Use Cannabis

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New York is on the verge of joining 15 other U.S. states that have legalized the sale of recreational cannabis for adults 21 and older.

After months of negotiation, legislation that would legalize, tax and regulate adult-use cannabis was finally introduced into the Senate on Saturday by lead sponsor Sen. Liz Krueger.

The final bill (S.854-A/A.1248-A) is an amended version of the Marijuana Regulation and Taxation Act (MRTA) and will be carried in the Assembly by Majority Leader Crystal Peoples-Stokes.

Under the bill, a 9% state excise tax would be levied on all cannabis products sold at the retail level, while an additional 4% local tax will be split between counties (25%) and municipalities (75%).

Cannabis distributors will also be required to pay the following THC tax: 0.5 cents per milligram for flower, 0.8 cents per milligram for concentrated cannabis, and 3 cents per milligram for edibles.

In addition to creating a regulated and taxed commercial market for adult-use cannabis, the measure allows New Yorkers to cultivate up to six plants at home (3 mature and 3 immature), and up to 12 plants in households with more than one adult.

Adults would be allowed to possess up to three ounces of cannabis and up to 24 grams of cannabis concentrate outside of the home.

Cannabis legalization is expected to generate upwards of $350 million in tax revenue annually and create as many as 60,000 new jobs, according to Gov. Andrew Cuomo.

Meanwhile, sales would likely eclipse $1 billion in the first year and reach $3.6 billion by year four, according to New Frontier Data.

“Legalizing adult-use cannabis isn't just about creating a new market that will provide jobs and benefit the economy — it's also about justice for long-marginalized communities and ensuring those who've been unfairly penalized in the past will now get a chance to benefit,” Gov. Cuomo said via a news release. “I look forward to signing this legislation into law."

A vote on the measure is expected this week, and Krueger — who spoke to Spectrum News NY1 on Monday and said she doesn’t “particularly like marijuana” — is hopeful it will pass.

“It’s a three-way agreement with the Governor, and I am confident that he will sign it when we pass it, and I am optimistic we get it done this week,” she said.

As written, the bill calls for the establishment of an Office of Cannabis Management that is tasked with implementing a “comprehensive regulatory framework,” and overseeing the state’s medical, adult-use and cannabinoid hemp markets.

It would also expand New York’s existing medical marijuana and hemp programs and create a “two-tier licensing structure” that separates growers, processors and wholesalers from also owning retail dispensaries.

Licenses for cultivators, processors, distributors, retailers, and delivery operators, as well as microbusinesses and nurseries, will be issued. On-site consumption licenses will also be available.

However, there is language in the legislation suggesting that existing medical marijuana operators — defined as “registered organizations” — could be permitted to vertically integrate.

“It’s a win for farmers, it’s a win for businesses, it’s a win for criminal justice, and I believe it is a win for social equity because we will reinvest the money from the marijuana revenue into businesses starting up in poor communities, drug treatment and prevention, and our education programs,” Krueger told Spectrum News NY1.

Indeed, the measure addresses diversity concerns by creating economic opportunities for communities of color.

New York has a goal of awarding 50% of cannabis licenses to social and economic equity applicants, and 40% of cannabis tax revenue has been earmarked for a “Community Grants Reinvestment Fund.”

That fund, according to the bill text, will be used for “reinvesting in communities disproportionately affected by past federal and state drug policies.”

A portion of those funds will also be used to finance loans, grants and incubator programs that “ensure broad opportunities for participation in the new legal industry by people from disproportionately impacted communities as well as by small farmers,” a news release noted.

"My goal in carrying this legislation has always been to end the racially disparate enforcement of marijuana prohibition that has taken such a toll on communities of color across our state, and to use the economic windfall of legalization to help heal and repair those same communities,” Krueger said via a news release. “I believe we have achieved that in this bill, as well as addressing the concerns and input of stakeholders across the board.”

Additionally, the bill calls for the “automatic expungement or resentencing” for anyone with a previous marijuana conviction that would be legal under the new law. Penalties for possessing less than three ounces of cannabis would also be eliminated.

Krueger, who noted that lawmakers have been working on this legislation for seven years, believes legalizing marijuana carries “less risk than tobacco or alcohol,” vices that are already taxed and regulated.

“We’re not encouraging people to use,” she told Spectrum News NY1. “Anyone who thinks there is not marijuana in their community, that their children can’t get it if they want it, isn’t really looking very carefully.”

By legalizing cannabis, Krueger asserts that consumer safety would improve because of mandatory tracking and laboratory testing.

“When this bill becomes law, New York will be poised to implement a nation-leading model for what marijuana legalization can look like,” she added.

Additional information is available in the news releases, linked below.

Governor Cuomo and Legislative Leaders Announce Agreement to Legalize Adult-Use Cannabis

Final Bill Introduced To Legalize, Tax, And Regulate Adult-Use Marijuana


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