Pot activists on Friday pressed state regulators to delay the entry of major medical marijuana companies into New York’s budding legal cannabis market, warning that larger players could snuff out smaller sellers.
In a letter to the state Cannabis Control Board, the activists urged a “prudent approach to delay MRO entry into the market,” using an acronym for so-called medically registered organizations, which are large cannabis manufacturers.
Limiting the entry of MROs — which can crowd out smaller sellers thanks to their money and resources — is essential to allowing burgeoning businesses a chance to break into the slow-developing market, according to activists.
The activists’ letter, which carried more than 300 signatures, came ahead of a Cannabis Control Board meeting scheduled for next Tuesday. The state Office of Cannabis Management declined to comment on the letter.
The public Tuesday meeting is expected to include a vote on an expansive regulatory framework — running more than 200 pages — intended to broaden the state’s legal cannabis market at the end of the year.
Various stakeholders in the marijuana market have sought to pressure the state’s cannabis office to either pause or expedite licenses for MROs ahead of the meeting. Supporters of the MROs say that New York’s rollout has been uniquely hostile to the large manufacturers.
In a letter to Gov. Hochul dated Aug. 31, the leaders of four MROs said “medical operators provide a stable supply chain of safe, tested and taxed cannabis products” and an opportunity to “displace the unlicensed market, while simultaneously generating the revenue necessary to help cannabis entrepreneurs of all backgrounds.”
Currently, the legal market is limited to a smattering of some 460 licensees which have opened 17 storefronts and six delivery businesses across the state.
In July, the control board issued more than 100 new licenses to applicants seeking to run pot shops in the city. The state Legislature legalized recreational cannabis use for anyone 21 and over more than two years ago, and the state issued the first 36 permits last November.
Officials have said the legal market could ultimately produce 60,000 jobs and generate $350 million in revenue annually.
But the permit approval process has been sluggish, and has allowed a vast market of illegal sellers — some that market toward children — to emerge in New York, frustrating officials.
The activists behind the Friday letter wrote that they understand the “urgency of New York State’s transition to adult-use cannabis” and do “not seek to hinder or delay this vital process.”
“Rather, our intent is to ensure that the forthcoming marketplace reflects the principles of fairness and social justice that have underpinned the legalization efforts,” they wrote.
Jayson Tantalo, a signatory of the letter and co-founder of a coalition for an inclusive cannabis licensing process, said the delayed rollout has “put a massive chokehold on the industry.”
Another signatory, Kavita Pawria-Sanchez, chief executive of the equity-focused nonprofit CannaBronx, warned that the “market has shifted in that these big players are going to be able to come in earlier.”
“They have the ability to nearly take over,” Pawria-Sanchez said, “at the expense of Black and brown communities.”
She said she was hopeful the letter would prompt government action, and that a new ad campaign targeting Hochul and led by some of the state’s licensed medical cannabis companies would backfire.
That $500,000 campaign, organized by the Coalition for Access to Regulated & Safe Cannabis, has secured advertisements in the Daily News, The New York Times, the New York Post and the Buffalo News, said Jake Sporn, a spokesman for the coalition.
The coalition is aligned with both MROs and small entrepreneurs.
Its advertisements accuse Hochul, a Democrat, of bungling the state’s legal weed rollout, calling the program a “total failure” and urging the state to grant permits to more veterans, women and minority business owners.
At a news conference in Albany on Thursday, Hochul described the pace of the permitting process as “disheartening” but said litigation from out-of-state corporate entities had slowed the process.
“I inherited a framework that was passed and enacted before my time,” Hochul said. “We are working to implement it.”
In a Friday statement, Hochul’s spokesman Jason Gough said the state would “continue working to ensure that small, local businesses are able to compete and thrive” despite delays caused by “large cannabis corporations seeking to increase their profits.”
Harlem’s first legal weed dispensary was expected to open earlier this week. But its long-awaited opening was derailed by an order from a State Supreme Court judge in Albany that froze expansion of the state’s fledgling weed industry.
The MRO-aligned Coalition for Access to Regulated & Safe Cannabis was one of the plaintiffs in the case that paused the rollout.
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