Gov. Hochul announced yesterday that the state Office of Cannabis Management and Department of Taxation and Finance had leaned on new laws to seize 1,000 pounds of unregulated cannabis from 31 storefront businesses. It’s a start. Barely.
If we gave out participation trophies, this operation might get one for nabbing a handful of businesses out of 1,700 estimated unlawful sellers in New York City alone, plus more in the rest of the state. So 31 down and another 1,669 to go. A month after expanded enforcement powers became state law, Hochul will have to do a lot more to make it to the award podium.
In this case, the prize isn’t a big trophy but a big windfall of expected tax revenues, which were projected at up to some $1.25 billion over the first six years post-legalization, but which in practice totaled a paltry $16.5 million as of last month. To put that into context, that’s just $500,000 more than the additional $16 million allocated to cannabis enforcement in Albany’s fiscal year 2024 budget, meaning that the supposed cash cow isn’t even close to breaking even.
It’s not just state coffers that are suffering. The burgeoning licensed retail industry, populated by people who have suffered from marijuana criminalization and organizations that serve them, has no chance of competing long-term against an already-robust and dominant black and gray market sector that has mostly sold without consequence, without having to worry about the integrity of its product or the costs of running the business lawfully.
The worries that heavy-handed enforcement is a return to the bad old days of hyper-criminalization are wrong. No one is getting locked up. Enforcement is targeted to shut down the illegals, not arrest people. That said, the state can’t and shouldn’t simply give up its regulatory mission; as with any other area of public enforcement, it’s a question of discretion and proportionate response. Don’t slap the cuffs on a teen peddling weed at the bus stop, but repeat-offender, brick-and-mortar shops, of which there are many, have no excuse.
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