How to get an adult-use cannabis dispensary license in New York State?
Like the industry itself, the pathway to procuring an adult-use dispensary license in New York State has been characterized by ongoing change. To begin with, an initial well-intended equity-focused plan, called CAURD, took legalization as an opportunity to re-write some of the targeted unfairness of the war on drugs. CAURD, short for Conditional Adult-Use Retail Dispensaries, proved to be better in theory than in practice, as is perhaps clear by the number of licensed operators in the state (463) relative to the number of licensed operating dispensaries (23, at the moment). Even with the slowness of CAURD to take off, it might have had better luck had it not been for a lawsuit that brought all state-issued licensing to an abrupt halt, after a state supreme court judge deemed CAURD’s preferential provisions unconstitutional. In this blog post we’ll discuss how to navigate the morass of New York State’s iffy CAURD roll out and what to expect in the coming weeks and months.
The CAURD program
At the outset, CAURD was a well-intended program aimed at benefiting “justice-related” individuals who had a history of criminality or conviction under New York’s pre-legalization drug laws. However, after several veteran plaintiffs brought their case to court and won, CAURD’s preferential licensing criteria were deemed unconstitutional. Either way, the somewhat niche, difficult to meet qualifications of CAURD has left the state in a limbo period, with adult-use dispensary licenses numbering in the hundreds, but only twenty or so actual dispensaries in operation. A related fund, set up to benefit the CAURD-carrying licensed retailers, estimated at nearly $150 million, has been left with nowhere to go (has even $1 been spent?). There’s more to be said here, including that the backfiring of the state’s agenda has given rise to an environment dominated by illicit sales out of bodegas and other unlicensed weed shops, who represent a threat to the legal sector and their tax-inflated prices, not to mention an ongoing drug safety concern. Though a tremendous amount of political will remains in support of CAURD, it’s beginning to seem its time has passed.
How much is a Dispensary License in New York
The initial upfront fee for a dispensary license in New York is $2,000. Note that this is an application fee, and does not cover or apply to the remainder of your costs, depending on your overhead. It’s also worth noting that being able to come up with the application fee does not guarantee a successful application.
Opening up the Field
Though its hand was forced, in part from the veteran’s lawsuit, in part the lack of successful, open, operating dispensaries, the state plans to open up the field to non-CAURD adult-use dispensary applicants October 5. This is big news. As it stands, however, there have been no updates to the state’s adult-use dispensary application page, which means no concrete steps to take on the application front. What we can say on the basis of the CAURD standard is that the application criteria will most likely be rigorous and extensive. Be prepared to produce all listed on the state’s site apart from the CAURD-specific proof of justice-involvement. The window, a narrow one, is set to open Oct 5-Dec 23, so be prepared and ready to go with your materials by that date.
Enter the MSO’s …Who Dominate Medical Marijuana Licenses in NY
So-called MSO’s, the big multi-state operators intentionally kept out by the initial CAURD preference, will now have full access to the New York market. Already they’ve scooped up a majority of the available medical marijuana licenses, and, as of October 5, will be eager to open adult-use stores across the state. Their impact on small-scale operators, legally licensed and otherwise, will be significant. Commenters forecasting their influx are also predicting the flow of long-awaited capital into the sector, which is good for investors and capitalists who regard cannabis as an investment opportunity, but bad for the small-scale retail operators who will be forced into competition with them. Though barriers to entry for the MSO’s remain–including an entry fee of $5 million–if medical marijuana dispensary licenses are any indication, the impact of the MSO’s on the general cannabis market will be sizeable and significant. Expect their big, visible presence to offset the hold of illicit retailers on the market, as well, as we said, of growing confidence in the cannabis sector as a viable investment opportunity.
NYC Dispensary License
There are no application requirements specific to the city of New York, as opposed to New York State. All compliance and application regulations hold equally for both. The one minor consideration is that the prevalence of illicit sellers in the city is higher, so legal sales would naturally be impacted by that, but applicants within the city should follow the same rules as apply elsewhere.
Take Action and Get Ahead of the Curve with Flourish
Looming over the many changes afoot in New York is the requirement that all licensed adult-use operators in the state of New York adopt 3rd party software, as OCM is soon to announce, to be in place by mid-November. So among the scramble for licensure will be the scramble to ensure the best, most advantageous software sets you up for syncing with the state’s chosen tracking software, Biotrack. Our client Flourish offers state of the art software designed to connect sales, operations, and finance while satisfying the demanding compliance requirements of an upstart or established cannabis company. For more on how Flourish can help you stay abreast of New York State’s evolving adult-use roll out and more, click here.