After months of negotiations following years of failed attempts, New York Senate leaders and Governor Andrew Cuomo announced on March 24 that they have reached an agreement on legalizing cannabis for adult use in the state. A bill is currently being drafted and could be voted on within a week.

Assembly Majority Leader Crystal Peoples-Stokes said that an agreement is “imminently close,” and that “we hope to resolve any final bill language issues over the next few days as we await the final print version of the bill to vote.”

While the final text of the bill is not available and some changes could be made before it is voted on, the following details have been reported by the press:

  • Adults 21 and older would be able to possess and purchase marijuana products from licensed retailers, which would launch in December 2022.
  • A person could cultivate up to six plants for personal use, only three of which could be mature. A maximum of 12 plants could be grown per household with more than one adult. Municipalities could not ban people from growing their own, but they could impose regulations. Registered medical cannabis patients would be allowed to start growing plants six months after the law takes effect, while adult-use consumers would have to wait 18 months after the first marijuana retailer launches.
  • Cannabis products would be subject to a state tax of 9 percent, plus an additional 4 percent local tax, for a total of 13 percent tax.
  • Marijuana distributors would also face a THC tax on flowers, concentrate and edibles—applied on a sliding scale based on type of product, up to 3 cents per milligram.
  • A five-member New York State Cannabis Control Board would be responsible for regulating the cannabis market. Three members would be appointed by the governor, and the Senate and Assembly would appoint one member each.
  • Social consumption sites would be permitted.
  • Individual jurisdictions would be allowed to opt out of allowing retailers or social consumption sites by the end of this year, but voters could overturn bans via local ballot measures.
  • In general, there would be a three-tier licensing structure separating growers, wholesalers and retailers―similar to the alcohol system, though there would be certain exceptions allowing microbusinesses to be vertically integrated.
  • The legislation sets a goal of having 50 percent of marijuana business licenses for distribution and retail issued to social equity applicants, including people with past marijuana convictions or who have relatives with such records as well as those living in economically distressed areas or places where cannabis criminalization has been enforced in a discriminatory manner. Equity applicants would also include minority- and women-owned businesses, disabled veterans and financially distressed farmers.
  • Tax revenue from marijuana sales would cover the costs of administering the program. After that, 40 percent of the remaining dollars would go to a community reinvestment fund, 40 percent would support the state’s public schools and 20 percent would fund drug treatment facilities and public education programs.
  • The state Health Department would be required to study devices that are supposed to test saliva to determine if a person is impaired from marijuana, though there’s skepticism among lawmakers about the effectiveness of such technology.
  • Police would be allowed to use the odor of cannabis to identify impairment, though they could not use it to justify a search of a vehicle.
  • Driving while impaired by marijuana would result in a violation, rather than a misdemeanor. However, that component may be further revised before the final bill is released.
  • The state’s existing medical cannabis program would also be changed to expand the list of qualifying conditions and allow patients to smoke marijuana products. Patients could also obtain a 60-day, rather than 30-day, supply.
  • Existing medical cannabis dispensaries would be allowed to open four additional shops, as long as at least two are located in underserved communities. They could also add two adult-use retail locations.

As we reported in our January 11 Alert, Governor Cuomo proposed a legalization bill as part of his budget proposal the same week that Democratic Senator Liz Krueger introduced a separate New York cannabis legalization bill, the Marihuana Regulation and Taxation Act (MRTA), that was co-sponsored by 18 of her colleagues.

For further details about both proposals, read our Duane Morris Alerts from January 22 and February 18.

For More Information

If you have any questions about this Alert, please contact Michael D. SchwammDeanna J. Lucci, any of the attorneys in the Cannabis Industry Group or the attorney in the firm with whom you are regularly in contact.

Disclaimer: This Alert has been prepared and published for informational purposes only and is not offered, nor should be construed, as legal advice. For more information, please see the firm’s full disclaimer.

 

Source: https://www.duanemorris.com/alerts/new_york_lawmakers_reach_deal_cannabis_legalization_vote_expected_soon_0321.html