Marijuana is Legal in NYC - What You Need to Know

The New York City Comptroller recently said that expanding cannabis legalization into New York State could create a $3.1 billion market, with NYC gaining an additional $336 million in annual tax revenue.

With such a grand financial incentive, it’s no surprise then that New York has made colossal moves toward legalizing, decriminalizing, and opening up shop for cannabis. This article will break down how this came to be, give an overview of what’s legal and what’s not, and advise you on how to open up a cannabis business in NYC.

History of Marijuana in NYC

Cannabis is the second most used recreational drug in NYC, after alcohol. If you’ve ever taken a stroll through Manhattan, you’ve smelled it on the streets.

This is because, in NYC, it’s now totally legal to smoke cannabis for personal use, provided you’re above 21 and don’t have more than 3 ounces on you. For concentrated cannabis, you can only have 24 grams.

Medical

Going back nearly a decade, marijuana was first legalized for medical use in NYC in 2014. This means that people may be eligible to use medical cannabis to treat their health condition if a state-registered healthcare provider certifies that medical cannabis is clinically appropriate. Only on doctor’s orders.

The medical cannabis program remains in effect even as the drug is legal for recreational use. In fact, the list of conditions to qualify for medical cannabis was eliminated as of January 2022 - all that’s needed to obtain a medical card is for a medical practitioner to deem it necessary for the patient's treatment.

Recreational

Recreational marijuana, often referred to in the law as “adult-use cannabis,” was legalized as part of the Marijuana Regulation & Taxation Act (MRTA) passed on March 31, 2021. Adults over 21 can smoke marijuana wherever they can smoke tobacco. 

Important to note is that cannabis use is not allowed in motor vehicles (even if they are parked) or in outdoor dining areas at restaurants. Smoking or vaping cannabis in prohibited areas may result in a civil summons and fine.

Legal Penalties and Marijuana Offenses

Just because cannabis is legal for recreational use now does not mean that you can do whatever you want with it. There are still strict penalties for carrying more than the legal amount, selling or distributing it, possession by minors, and much more. If you have any questions, check the law.

Possession is limited to 3 ounces (or 24 grams for concentrated cannabis). Possession of more than three ounces but less than one pound of cannabis is considered a violation punishable by a fine. Possession of one to five pounds of cannabis is now considered a Class D felony, while possession of more than five pounds is a Class C felony, which can result in a prison sentence of up to 15 years.

Currently, the following penalties are in place:

• The unlicensed distribution of cannabis is also subject to new penalties under the MRTA. 

• The sale of up to one ounce of cannabis without a license is now considered a violation punishable by a fine. 

• The sale of between one ounce and three pounds of cannabis is a Class A misdemeanor, 

• The sale of three to 10 pounds is a Class E felony. 

• The sale of more than 10 pounds of cannabis is now considered a Class C felony.

Restorative justice

As we mentioned, the MRTA legalized the use of cannabis for adults aged 21 and over and established a regulatory framework for the production, distribution, and sale of cannabis products. The law also includes provisions to address the racial disparities in cannabis-related arrests and convictions.

It accomplishes this by directing a portion of the tax revenue generated by the industry towards community reinvestment and providing opportunities for those who have been disproportionately affected by the war on drugs to participate in the legal cannabis industry.

How to Open Up a Cannabis Business in NYC

The first recreational cannabis dispensary opened up in December 2022, well ahead of the planned summer 2023 launch date. However, as of the writing of this article, it is now impossible to open up a cannabis business in New York City. Here’s why:

The application period has ended

New York City and NY State are doling out licenses in waves. The first wave, which included only conditional adult-use retail dispensary (CAURD) licenses, ended in September 2022. Interestingly, In order to qualify, you or a family member must have a prior cannabis-related offense and have prior company ownership and operating experience.

Monitor www.cannabis.ny.gov/licensing for updates as future license information becomes available. As of right now, there are no estimated time frames for any future license types.

If licenses become available… then what?

When you finally acquire a coveted license to sell cannabis in NYC, you need to be prepared to move forward and open your dispensary. Here’s what you need to know to be prepared before you run a successful cannabis business.

• Choose a location - Once you have obtained a license, you will need to choose a location for your dispensary. You will need to comply with local zoning and land use laws, which may limit where cannabis businesses can be located. For example, you can’t be within 500 feet of a school or within 200 feet of a church.

• Set up your dispensary - Once you have chosen a location, you will need to set up your dispensary. This may include renovating the space, installing security systems, and obtaining the necessary equipment and supplies.

• Ensure Biotrack compliance - Before you acquire any flower, you need to set up Biotrack, a mandated track-and-trace program, and integrate it into all your business systems.

• Hire and train staff - You will need to hire and train staff to work in your dispensary. This may include budtenders, security personnel, and administrative staff.

• Obtain and stock inventory - It will serve you well to develop relationships from across the cannabis supply chain, especially with licensed cannabis growers and manufacturers, so when it comes time to obtain inventory, you’ll be able to easily stock your dispensary with a variety of products that meet the needs of your customers.

The Next Steps

This year and last year have been monumental for the cannabis industry in New York. There’s a ton of opportunity just waiting to be tapped, so keep your eyes peeled for new licenses. Organizations such as the Cannabis Association of New York offer a bevy of resources, including talks, networking events, and other events to help small and medium businesses in the industry.