October 21, 2021

Making adult-use pot legal remains NY issue

Stock Image of Marijuana

The state Legislature will convene later this year, but whether they’ll discuss legalizing adult use of marijuana, a measure removed from the state’s budget package earlier this month, is undetermined, said Darren “Hal” McCabe, executive director of the Legislature’s Commission on Rural Resources.

“There is certainly a chance it can get done this year, and in my thinking it is probably one of the main bills they will consider along with things to support New York residents and businesses and organizations during this (coronavirus pandemic),” McCabe, also Homer’s mayor, said in an email. “But I could be wrong.”

McCabe has been working with several organizations on a bill called the Marihuana Regulation and Taxation Act II, which has key differences from the originally proposed Cannabis Regulation and Taxation Act.

In 2018, Gov. Andrew Cuomo introduced the proposed act to foster an adult-use marijuana industry in the state. However, some parts of the legislation raised concerns for small farmers and municipalities.

McCabe said he talked with local hemp producer Allan Gandelman, who is also the president of the New York Cannabis Growers and Processors Association, on ways to improve the bill.

“I think the rural commission did a really good job with their recommendations and they are definitely heading down the right path as it pertains to farmers,” Gandelman said.

One of the biggest things Gandelman wanted changed was the ability for smaller farmers to get licenses so that the market wasn’t dominated by larger companies.

The commission proposed doing that by recommending a fix to the tax structure, reducing a proposed 55% tax — the highest in the nation — to 28%.

“With the taxation structure proposed, cultivators would bear all of the burden and will price many small farmers out due to their naturally lowered ability to absorb price fluctuations,” McCabe said in March.

“They (the commission) have a much better tax structure,” Gandelman said.

Other concerns the commission addressed:

  • Providing legislative authority over the Cannabis Control Board and Office of Cannabis Management.
  • Preventing one company from also owning parts of the supply chain by creating a three tier licensing system.
  • Creating a tax to assist municipalities hosting retail dispensaries.
  • Allowing municipalities to opt out through local referendum, rather than giving the decision to the county governments.

McCabe had said the bill didn’t make it into this year’s budget because “they were so different from the governor’s bill that there just wasn’t enough time to reconcile the two within the budget process,” he said.

Gandelman said he is hopeful the legislation will get passed later this year.

“If the legislative session can get adult use done this year, the economic impact it will have across New York State will be tremendous,” Gandelman said. “This will create so many jobs and so much revenue for the state.”

The governor’s act requested $34.3 million to implement, but would generate $20 million in revenue in the 2020-21 fiscal year and $63 million in 2021-22.