Day: November 28, 2023

During a recent meeting of the Cannabis Control Board (CCB), the group voted to approve an agreement to allow for the continuation of CAURD. While details remain confidential, the two lawsuits that would be resolved under the settlement are:  

• Carmine Fiore, et al. v. New York State Cannabis Control Board: Filed by military veterans to address concerns over the exclusion of disabled veterans from social equity licensing prioritization. 
• Coalition for Access to Regulated & Safe Cannabis v. New York State Cannabis Control Board: Filed by existing medical cannabis operators and prospective adult-use applicants to address the proper application of the state cannabis law. It asserts that regulators are misapplying the law and argues that current medical cannabis businesses should qualify for licensing as well.  

The agreement must now be presented to the New York Supreme Court for approval. If the state’s high court approves the settlement agreement, the issuance of CAURD licenses will resume and licensees will be allowed to open storefronts.

Office of Cannabis Management (OCM) Executive Director Chris Alexander said in a press release on Monday that NY is now “one step closer to resolving litigation brought forth by equity entrepreneurs and medical operators.”

“Now that we have opened up licensing to all equity entrepreneurs and provided a clear pathway to participation in the adult-use market for our medical operators, we are able to continue to move this program forward together,” Alexander said.

New York cannabis businesses can now take tax deductions 

New York Governor Kathy Hochul (D) has signed a bill allowing New York City cannabis businesses to deduct their business expenses for tax purposes. This measure will provide relief to those facing restrictions under the Internal Revenue Service (IRS) code known as 280E, which blocks them from making such deductions against their federal tax liability. 

Although Hochul did sign a budget bill last year to allow state-level cannabis business tax deduction, NYC’s own tax laws remained unaffected. The new legislation would address that limitation and enable city-based businesses to benefit from state tax deductions as well. However, cannabis businesses would still be unable to take such deductions against their federal tax bill as IRS Code Section 280E remains in place federally.

“This bill would allow a deduction for business expenses, incurred by taxpayers authorized by the Cannabis Law to engage in the sale, distribution, or production of adult-use cannabis products or medical cannabis, for purposes of the unincorporated business tax (UBT), the general corporation tax (GCT), and the corporate tax of 2015, commonly referred to as the business corporation tax (BCT),” a summary of the bill reads.

A section of the city’s tax code would be amended to add sections allowing the deductions “in an amount equal to any federal deduction disallowed by section 280E of the internal revenue code.” So, while cannabis businesses remain unable to take federal tax deductions available to other businesses, the bill would allow them to recoup those costs at the city and state levels.

New Jersey’s first veteran and Latina-owned dispensary opens in Jersey City 

The Cannabis Place, founded by retired U.S. Marine Osbert Orduña, celebrated the grand opening of its flagship dispensary in Jersey City on Nov. 9 at 4:20 p.m. The opening marks not only the state’s first veteran-owned dispensary but also its first Latino-owned establishment. 

“We picked this week to open [because] it is symbolic in many ways,” Orduña said in a statement. “I am an Iraq veteran, [it is] the Marine Corps birthday and Veterans Day, too. To add the opening of Jersey City’s first service-disabled veteran-owned business to this makes this week even more special to us and our team.”

Prior to the opening, The Cannabis Place announced the completion of the first-ever cannabis retail pre-apprenticeship training program in the United States, in partnership with the United Food and Commercial Workers International Union (UFCW) Local 360. The program currently includes 22 local students, who are learning the basics of working in cannabis retail from UFCW Local 360’s own experts. Each participant in the two-week pre-apprenticeship course is guaranteed a job with The Cannabis Place to complete the 2,000 hours required for the full apprenticeship program. 

“We want our business to serve the local community,” Orduña said. “That means running an ethical, unionized company and boosting the prospects and prosperity of our neighbors. This program does that and is more proof that workforce investment equals immediate positive community impact. People can start careers here, whatever their background and skill level, and regardless of their history.”

New York cannabis sales reach over $100 million

New York has officially surpassed $100 million in adult-use sales so far in 2023, according to the minutes of the Nov. 11 Cannabis Control Board (CCB) meeting. Despite a limited number of dispensaries (just 27 operational statewide since legalization), the state has already reached a major milestone. 

Dispensaries drove the majority of those sales, but the milestone is thanks in part to the 54 Cannabis Grower Showcases (CGS), which allow licensed growers and processors to work with retailers to sell their products at events like farmers markets. Thus far, the CGS program has contributed $3.4 million in sales, helping expand cannabis access to even more New York City residents.

According to John Kagia, director of policy for New York State’s Office of Cannabis Management, the state’s regulated market is experiencing the “beginning of a rich brand diversification that’s only going to accelerate with more cultivation, processor, and distribution licenses” coming online in the future. Currently, there are 200-plus brands in the market and, as of November 2023, New York’s licensed retailers, on average, are carrying more than 50 brands. An estimated 72% of these dispensaries have more than 200 SKUs in their stores. 

“This is a critical milestone for the market. It continues to reflect an incredible retail velocity, and with the extraordinary effort that our retailers have put forth in getting the stores up, securing diverse products, and getting the customers in, we continue to see strong growth amongst the operators that we currently have,” Kagia added.

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