Tag Archives: andrew cuomo

David Feldman

New York Proposes Legalizing Adult Use Cannabis

On Tuesday, NY Gov. Andrew Cuomo released draft adult use cannabis legislation. Called the Cannabis Regulation and Taxation Act, it is just a few hundred pages long. The bill would set up a new “Office of Cannabis Management” (OCM) to oversee regulation. The office would operate under the Division of Alcoholic Beverage Control, taking control from the Department of Health, where it currently sits for the existing NY medical cannabis program.

The OCM’s Executive Director would get to decide how many licenses for growing, processing and selling cannabis it will grant. It would also decide the “standards of cultivation and processing” of cannabis and be permitted to conduct inspections and exact civil penalties on rule breakers. In a nod to those historically disadvantaged by the war on drugs, the OCM would be authorized to offer low or zero interest loans to “qualified social equity applicants.” The OCM would also take into account whether a license applicant is minority or woman-owned or owned by a service-disabled veteran or a disadvantaged farmer, and must implement a plan to “actively promote racial, ethnic, and gender diversity when issuing licenses.” Businesses would be prohibited from taking “adverse employment action” against an employee just for conduct which the bill permits unless their job performance is impaired. Three different taxes would be imposed on cultivation and sale, including a 22% combined state and county tax on a sale from a wholesaler to a retailer. The state estimates this could yield as much as $300 million in annual tax revenues. Taxes would be used for traffic safety, small business and substance abuse services.

Medical cannabis availability would be expanded to include, among other things, autism, and the OCM can add to the list in their discretion. Hospitals would be able to dispense medical cannabis. The current “registered organization” model for medical cannabis companies would continue, with the bill requiring at least 10 such ROs (there currently are 10 licensees). Non-NY licensed medical cannabis operators could receive licenses here without going through the rigorous application process if the OCM is satisfied with the regulations in the state of the original license. In fact the proposal requires giving a preference to these companies that are licensed elsewhere. This would likely favor the larger multi-state operators. Medical patients would be permitted to grow up to four plants at home.

Current ROs would be permitted to apply for adult use licenses, and the OCM would be able to conduct an auction of those licenses among the current ROs, with money used to make those low or no interest loans. Qualifying for medical cannabis would be deemed a disability under NY law. Retail pricing of medical cannabis would be approved by the OCM. CBD growers and extractors would also be able to obtain licenses, but food from hemp and hemp that is not intended for consumption generally would be subject to normal agriculture laws. Cannabis testing labs, cannabis brokers, truckers, delivery services, CBD retailers, caterers serving cannabis and warehouses also would be licensed by the OCM.

Regarding adult use, companies would not be required to be “vertically integrated” – a business can be growing, processing, distributing, selling or transporting cannabis or operating an “on-site consumption” location, which would be permitted. Cultivators would only be permitted one license each. Processors would be able to receive up to three licenses. Growers, processors and distributors (other than existing ROs) would not be permitted to own an adult use dispensary, and no one would be allowed more than three adult use dispensaries. Public smoking and outdoor growing of cannabis would not be permitted, but growing in greenhouses would be. Adult use would be permitted for those aged 21 and older.

Municipalities where adult use dispensaries would be located would have the right to express their opinion on the matter, which the OCM can take into account. Larger counties and cities would have the right to opt out of adult use cannabis. One controversial provision requires companies with more than 25 employees to sign union agreements. Advertising would be permitted but regulated. No importing or exporting of cannabis would be permitted unless federal law changes. Licenses would not be transferable. There’s an interesting provision prohibiting state law enforcement agencies from cooperating with the Federal Government in enforcing the Controlled Substances Act against people complying with the proposed law. Licensees’ principal officers and directors do not have to be NY residents, but must be US citizens or permanent residents.

Remember this is just a proposed bill. It still has to go through the NYS legislature, though both of those houses are currently controlled by Cuomo’s Democrats. The Governor has stated he would like to pass legislation by mid-April.

 

David Feldman

Cuomo Announces Plan for 2019 NY Adult Use Legalization

New York Governor Andrew Cuomo today said that he will support legalization of adult use of cannabis as a key part of the 2019 legislative agenda. In fact news reports suggest he wants to get this done within the first 100 days of his new term next year.

In his remarks on the subject he focused on reversing the stigma of cannabis use and eliminating the targeting of people of color in enforcement of anti-cannabis laws. According to ABC News, in New York City, Comptroller Scott Stringer estimated  that legalizing cannabis could yield as much as $1.3 billion in annual tax revenue for the state and about $350 million for New York City alone.

In August the Governor commissioned a work group to focus on drafting the legislation, following the advice of a task force that the benefits of legalization outweigh the risks. The work group has been conducting “listening sessions” throughout the state.

As recently as 2017 the Governor had called cannabis a gateway drug. Given the national trend to legalization and the fact that New York’s neighbor, New Jersey, is about to pass adult use legislation, however, Cuomo has felt political pressure to move ahead.

David Feldman

New York Approves Medical Cannabis as Opioid Alternative

Following guidelines already in place at the New York Department of Health, Gov. Andrew Cuomo signed a bill last month formally adding “acute pain management” to its list of conditions for which medical cannabis can be prescribed. This change is important since it allows doctors to offer cannabis as an alternative to opioids for acute pain, not just chronic pain, which was previously added to the list. Substance use disorder sufferers also would be permitted under the bill to obtain medical cannabis to manage their pain, again with the hope of avoiding the use of opioids.

We need not recite the well-documented human destruction that has been caused by the US opioid epidemic. Not limited to those with addictive tendencies, many are innocently prescribed these drugs following surgeries or with other acute pain and become hooked. Now NY doctors will have a state legal alternative in these situations. And while there are no clear statistics yet, a study published by JAMA in April of this year concludes, “[L]iberalized prescribing of marijuana may result in decreased use of opioids, and hence, fewer subsequent opioid-related overdose events.” In this population-based, cross-sectional study using Medicaid prescription data for 2011 to 2016, medical marijuana laws and adult-use marijuana laws were associated with lower opioid prescribing rates.

As we know, Gov. Cuomo in the last year or so has gone from considering cannabis a gateway drug to appearing to support adult use legislation, which is currently being drafted by a task force he commissioned. If he wins reelection in November, which is widely expected, many believe he will support such legislation if passed. His Republican opponent, Marc Molinaro, previously supported adult use legalization but recently has been stopping short, agreeing with the availability of medical cannabis and decriminalization to avoid cannabis users facing jail time.

David Feldman

NY Health Dept. to Recommend Legal Adult Use of Cannabis

The New York Times reported yesterday that the New York State Health Department is ready to recommend legalizing adult use of cannabis in the Empire State.  Commissioner Howard Zucker was quoted as saying they had reviewed the pluses and minuses and concluded, in a study requested by NY Governor Andrew Cuomo, that “the pros outweighed the cons.”  The study, started in January, has not been released yet.

Governor Cuomo, as recently as last year, said that cannabis is a “gateway drug.” But he is now facing strong opposition on the issue from his primary opponent Cynthia Nixon. Even his Republican opponent wants to legalize cannabis and use the money to fix New York’s transportation system. He is also feeling pressure from New Jersey’s apparent plan to legalize adult use in the near future, not to mention Massachusetts’ full adult use rollout commencing very soon. This led to his commissioning the Zucker study.

Even with this study recommending legalization, the NY legislature would have to pass a law to make it happen. Republicans, who tend to be more anti-legalization, currently control the Senate while Democrats control the Assembly. So there is no certainty of getting a bill passed. But it appears the momentum is building towards adult use legislation in the nation’s fourth largest state.

David Feldman

New York to Study Full Cannabis Legalization

In his annual budget address yesterday, NY Democratic Governor Andrew Cuomo announced his plan to form a task force to study possible legalization of the adult use of cannabis in the Empire State. Currently the state permits the sale of cannabis only for medical reasons.

Less than a year ago, Cuomo referred to cannabis as a gateway drug and was widely perceived not to be supportive of legalization. Observers believe, however, that politics may be forcing his hand. Neighboring New Jersey’s new Governor Murphy has announced his intention to legalize adult use of cannabis there. In addition, a potential Republican opponent to Cuomo’s reelection this year has announced his support of legalization in New York.

Currently, while cannabis remains illegal under US federal law, eight states and the District of Columbia have legalized adult use. More states are expected to approve legal sales later this year in the November elections. Others, like New Jersey, are considering legalization through legislation as opposed to voter referendum. As we know, California’s adult use program was launched to great fanfare on January 1 of this year.

New York, with nearly 20 million people, is the fourth largest US state. This creates the potential for a significant market for legal cannabis sales, state tax and tourism revenues and job creation. Legalization could be particularly helpful for New York’s struggling upstate region, which has not seen major job growth in the current economic recovery.

Forming a task force is a long way from legalization and the opening of cannabis stores in Times Square. Cuomo will center the proposed study within the NY Department of Health, which currently oversees the medical marijuana program. He is asking that the task force look at the economic and health impact of legalization.