Operating an Adult-Use Cannabis Business in New York: Licensing and Considerations for Landlords and Tenants


[co-author: Natalie S. Starkman] Although cannabis is still classified as a controlled substance at the federal level, New York State recently enacted the Marijuana Revenue and Taxation Act (MRTA), a law legalizing adult-use cannabis within the state. Questions abound, however. When will all five members of the Cannabis Control Board be appointed? When will the Board, once appointed, establish regulations including with regards to the licensing and application process—and what kinds of licenses will be available? Practically speaking, will landlords be willing to take on the risk of leasing space to cannabis cultivators, processors or dispensaries—and, if so, what are some of the issues that will arise in negotiating leases to cannabis operators? What constraints does the MRTA place on the location of these businesses? Licensing Considerations for Adult-Use Cannabis Operators in New York New York’s Marijuana Revenue and Taxation Act, legislation legalizing recreational-use cannabis, was enacted in March 2021 and creates a new Cannabis Law as Chapter 7-A of the Consolidated Laws of New York. The legislation delegates to the Board and a new Office of Cannabis Management (OCM) the authority to create and enforce a regulatory framework governing medical and recreational/adult-use marijuana. The five-member board will consist of three members appointed by the governor, one appointed by the state Senate, and one appointed by State Assembly. The Board must adopt regulations before the licensing process can begin. Although efforts to appoint the Board stalled following enactment of MRTA, Gov. Kathy Hochul recently appointed, and the Senate confirmed, leaders of both the Board and OCM. Tremaine Wright, a former member of the New York State Assembly and currently the first Director of the Department of Financial Services’ Statewide Office of Financial Inclusion and Empowerment, will lead the Board. Christopher Alexander, a criminal justice reformer and former legislative aide in Congress and the…

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Source : Operating an Adult-Use Cannabis Business in New York: Licensing and Considerations for Landlords and Tenants

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