OBSERVER Photo by M.J. Stafford
Susan Parker, Chautauqua County legislator and member of Fredonia’s Cannabis Advisory Committee, introduces Phillip Rumsey of the New York State Office of Cannabis Management during a meeting of the committee Tuesday.
There are still many uncertainties about New York’s cannabis licensing process, but state Office of Cannabis Management (OCM) officials filled in a few blanks at a meeting of Fredonia’s Cannabis Advisory Committee last week.
Phillip Rumsey, OCM’s manager of intergovernmental outreach, and Pascale Bernard, its deputy director of intergovernmental affairs, gave a presentation and took questions from the committee. The panel was started by Fredonia Trustee Jon Espersen in response to the village’s decision to opt into the state-regulated, legal sale of cannabis.
“What we’re really asking for is grace, because none of us have ever done this before,” Bernard said.
Ramsey explained while the Marijuana Regulation and Taxation Act (MRTA) passed in 2021 offers nine categories of licensing, the state has further expanded the options. It approved a standalone conditional licensing system in February for growers, intended to help New York’s existing cannabis farmers get into the upcoming market — and keep out giant out-of-state distributors. Also, in April, it started a program to offer conditional dispensary licenses. However, it’s only for people with both experience owning a related business, and a cannabis-related offense on their or a family member’s record.
Cannabis will be taxed according to its THC count, instead of by weight. THC is basically the main compound that gets a cannabis user “high.” Edible items will be taxed at 3 cents per milligram of THC; cannabis flower will face a 5 cents per milligram tax; and for concentrates, it will be 8 cents per milligram.
There will also be a 9% excise tax added by the state and a 4% tax that goes to local municipalities.
Revenues will go, naturally enough, to a Cannabis Revenue Fund. That will see 40% distributed to education funding, 40% to a community reinvestment grant fund for places disproportionately impacted by cannabis prohibition and 20% for a drug treatment and public cannabis education fund.
Rumsey said the licensing setup “is geared toward creating multiple entry points into the market.” The state wants to make sure large corporate concerns “can’t come in and instantly take up the whole cannabis ecosystem.”
The state officials offered plenty more tidbits of information about cannabis legalization.
¯ Bernard said while the state will decide where dispensaries will go, it is up to entrepreneurs to actually apply for the licenses. In other words, if no one seeks to put a dispensary in a given area, the state will not force the issue.
¯ There is no “breathalyzer test” for the drug, but the state will pay for municipalities’ training of local law enforcement cannabis recognition experts.
¯ It is not possible to apply for any of the nine original MRTA licenses yet, as the regulations are not ready. Rumsey said while the conditional licenses are expected to top out around 200, there might be as many as 4,000 of the regular MRTA licenses. However, he said, “It is difficult to put a specific time frame on when the regulations will be finalized.”
There won’t be any caps on the MRTA licenses. “We want to give ourselves the ability to adjust to market fluctuations,” Rumsey said. “We don’t want to create a Starbucks effect with the dispensaries.”
Bernard said that New York officials are trying to avoid the perceived missteps in other states’ cannabis legalization processes. They don’t want to move too fast or too slow.
¯ Clarification of zoning issues is ongoing, Rumsey said. “You’re not going to be able to have a tie-dyed building or something like that,” he assured the audience.
¯ Cannabis committee member Susan Parker, a Chautauqua County legislator who represents Fredonia, wondered how many dispensaries the state might be eyeing for an area the size of Dunkirk and Fredonia. Rumsey said that while there are no clear answers on that yet, “population looks like it will be an element in our analysis.”
Bernard used an analogy: a community of 200 people wouldn’t have five hardware stores. She added that the state does not want dispensaries to become flashpoints in communities.
¯ Espersen asked if the glut of cannabis dispensaries on the nearby Seneca Nation of Indians would discourage placement of a local dispensary.
“Those are sovereign territories and the OCM has as much jurisdiction over them as we do over Canada,” Rumsey said. As such, he said he “would be very surprised” if the cannabis licensing board accounted for those and “essentially punished communities because of that.”
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