New York's Office of Cannabis Management has opened the licensing process for non-conditional license applicants in a move to boost the legal market, forecasted to be worth billions of dollars in the next few years.
As highlighted by Gov. Kathy Hochul, New York is to expand New York's legal market with hundreds of new licenses being made available to individuals and businesses interested in legally growing, processing, distributing, and selling adult-use cannabis.
Widening the criteria to choose applicants and not limiting them to social equity applicants comes amid the flourishing activity of unauthorized businesses that sell illicit cannabis products across the state and may become a threat to the legal market in terms of competition.
New York's authorities have been trying to crack down on illicit businesses, but, although they seized more than 8,500 pounds of illicit product with an estimated street value of more than $42 million, they are far from ending the illicit market.
Therefore, a fresh licensing process round open to almost anyone, along with businesses licensed through the CAURD program, specifically designed for social equity applicants, may be able to help the state contrast the illicit market.
In order to cover the entire supply chain, the OCM has made available five types of licenses: Cultivator, processor, distributor, dispensary, and microbusiness. The slot to apply for these licenses started on October 4, and applications must be submitted online through New York Business Express by 5:00 PM EST on Monday, December 4, 2023.
NYSCC has compiled a brief overview of what types of licenses are available and what you can and can't do with them, easy to digest in less than five minutes.
This license authorizes its holder to cultivate and sell cannabis to a licensed processor, microbusiness authorized to process cannabis, cooperative or collective, Registered Organization with Dispensing (ROD), Registered Organization Non-Dispensing (ROND), or a cannabis research licensee in New York State.
The cannabis grown by a cultivator licensee will also be used to make safer lab-tested cannabis products.
Cultivators can process their own cannabis products only if they obtain an adult-use processor license.
Except for passive investors, one can't hold multiple cannabis cultivation licenses.
Importantly, cultivators and their True Parties of Interest (TPIs) can't have any stake in retail dispensaries, delivery services, or on-site consumption licenses.
A processor licensee can obtain, extract, blend, infuse, package, and label cannabis products as specified in the license. Processors create cannabis products for sale to licensed distributors, following appropriate manufacturing practices and ensuring third-party laboratory testing for product quality.
Keep in mind that a processor license holder can't own or be involved in another adult-use processor business, except for the TPIs, who can have interests in other businesses. The processor can also apply for a distributor's license but can't be associated with retail dispensaries, delivery services, or on-site consumption venues.
A distributor license allows for wholesale distribution of cannabis products to adult-use retail dispensaries, ROD, and on-site consumption licensees.
Distributors can obtain cannabis products from licensed cultivators, processors, microbusinesses, cooperatives, ROD, or ROND and sell or transport cannabis products to licensed adult-use retail locations.
Distributors and their TPIs can hold or have interests in other supply-tier licenses, but they can't have any stake in retail dispensaries, delivery services, or on-site consumption licenses.
Distributors and microbusinesses can't share TPIs except for passive investors. There are limits on the number of licenses an individual or entity can hold. Cultivators and processors can also obtain a distributor license. Distributors can transport cannabis products between adult-use cannabis licensees and facilities but can't make direct-to-consumer sales.
Retail Dispensary License
Retail dispensaries can obtain, sell, and deliver adult-use cannabis products. No one, except passive investors, can have an interest in more than three retail dispensary licenses, but they may have an interest in both a retail and a delivery license.
Retail licensees can't be involved in other cannabis-related businesses within the supply chain.
Location rules include distance requirements from schools, places of worship, and other dispensaries based on population.
Furthermore, applicants must notify local authorities where the premises are located.
Unlike others, this type of license can be a vertically integrated entity.
With a microbusiness license, you can grow cannabis between 3.500 ft2 and 5,000 ft2, purchase up to 500 lbs of cannabis biomass, process up to 1,700 pounds of cannabis biomass per year, and distribute, sell, and deliver cannabis products.
A microbusiness must grow cannabis and engage in at least one additional licensed activity like processing or retail.
Ownership is limited to one microbusiness license per person, without involvement in other license types. No one can apply for more licenses than allowed.
Microbusinesses must locate retail premises near cultivation areas, with specific rules based on city population.
Learn more about New York's cannabis licensing here.