N.Y. hands out first recreational weed dispensary licenses, most going to people with marijuana arrests
New York awarded its first recreational weed dispensary licenses Monday, a milestone in a lengthy process during which a burgeoning gray market of pot sales has cropped up across New York City.
Most of the initial batch of 36 licenses were awarded to people with past arrests for marijuana, an attempt to rectify what many see as the past wrongs of an overly harsh system.
The first dispensaries could open before the end of 2022, state cannabis officials said.
Among those receiving a license was Brian Stark, who after three marijuana busts and a short jail stint has gone legit to provide for his two kids and family.
Across 20 years of hard work, he bought two car washes and a laundromat. He learned how to build and flip houses. But Stark always remembered the source of his entrepreneurial skills: his early career peddling pot.
When New York’s Cannabis Control Board awarded the first licenses for retail stores Monday, the 42-year-old Stark received an email notice that he was among the first batch of recipients cleared to sell marijuana — legally, this time.
“It’s long overdue,” said Stark, who lives with his family in Freeport, L.I. “I’ve been dealing with arrests since I was a kid. You have to think that people put their life on the line to supply people that enjoy smoking marijuana. I did that and I got in trouble. It cost me time, money and lawyers.”
In total, 36 licenses were awarded statewide, 28 of which went to people with prior marijuana convictions or arrests of the direct family members, while eight licenses were awarded to nonprofits. Those who applied were required to show that they had owned a business that was profitable for at least two years.
“We’re excited about granting the first adult-use cannabis licenses today,” Trivette Knowles, a spokesperson for the state Office of Cannabis Management, said Monday. “New York is ready for adult-use cannabis sales and we’re still working towards the goal of having the first sales begin this calendar year.”
The state’s slow transition into legal, regulated cannabis sales has opened a gap for opportunistic business owners to meet New Yorker’s demand for weed. In anticipation of legal weed sales, a sprawling gray market for weed sales has cropped up across New York City.
Meanwhile, a lawsuit filed by a Michigan man led a federal judge in Albany to prevent the state from giving conditional adult-use retail dispensary licenses to vendors in Brooklyn, the Finger Lakes, Central New York, Western New York, and the Mid-Hudson area, including Westchester County.
The state plans to dole out 150 licenses to people with past pot offenses over the coming months.
Stark wasn’t optimistic at first. He saw how in many states, the rights to sell the new cash crop went to wealthy individuals and corporations that could afford to navigate the often complex licensing process.
“I saw how California was, a lot of big business took over everything and I started to get depressed thinking, I gotta be a multimillionaire to find my way into this industry,” he said. “But what we are doing here [in New York], that’s what makes this really amazing for me.”
Stark clocked his first arrest at age 16 when officers charged him with possession and intent to sell. The second followed when he was in college.
In 1999, Stark was convicted for conspiracy to sell. His lawyer negotiated a deal allowing him to enter a drug rehab program instead of serving out his entire sentence in jail, Stark said.
After a month in Nassau County Jail, Stark arrived at the drug rehab program only to be turned away when he passed a drug test. The program required participants to be active users, according to Stark, and he was clean due to his jail stay.
“I got out on a Monday and had to go back in on a Friday,” said Stark, referring to his incarceration. “My dad was so mad, I remember him even saying, ‘You need my son to get high again so you can accept him into this program?’”
Along with announcing the first licenses to sell cannabis, the state’s regulatory agency, the Office of Cannabis Management, announced preliminary regulations for the nascent weed industry.
Similar to wine and liquor store regulations, the marijuana regulations put a cap on how many stores a single investor can own. The guidelines prevent any one person from directly investing in more than three stores.
The new rules also prevent anyone from investing in both the cultivation and retail of the plant to prevent wealthy investors from controlling the supply and distribution of the product.
“It’s like a liquor store,” Axel Bernabe, the Policy Director for the Office of Cannabis Management, told the Daily News. “There’s a reason that 95 years since the legalization of alcohol, you still have liquor stores and wine stores in every town … and they’re almost all owned by families.
“One hundred years later, this system is still in place. It’s not a break the bank, I’m going to flip it, venture capital investment. It’s, ‘I’m gonna invest in a startup.’”
The regulations will enter a public comment period and will be cemented in January.
While the state has awarded the first licenses to the formerly convicted, New Yorkers are skeptical about the plan. A Siena College poll earlier this year showed only 33% of New Yorkers thought it was a good idea to award the licenses to formerly convicted individuals or their families.
Despite the stigma that comes with prior convictions, Stark said his experience as a business owner sets him up for success.
“I didn’t know anything about a car wash, I didn’t know anything about a laundromat. I didn’t know much about houses and I ended up building houses,” said Stark. “I figured it out, I’ll figure this out.”
