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NY opens applications for cannabis dispensaries, and those harmed by prohibition are first in line

A bud tender holds two marijuana buds at the Denver Kush Club.
David Zalubowski
A bud tender holds two marijuana buds at the Denver Kush Club.

New York State has begun the application process for licenses to run retail cannabis stores, nearly a year and a half after the drug became legal for adult recreational purposes.

It’s taking a different approach than other states that have legalized marijuana by emphasizing social and economic equity.

The first round of 100 or so licenses will be reserved for those who were harmed by the decades of marijuana prohibition. Applicants, or one of their close family members, must have a cannabis-related conviction in order to qualify.

Damian Fagan, chief equity officer for the state’s Office of Cannabis Management, said Thursday that the aim is to help reverse what he called a “dark history” of the hemp plant in New York and to give those in communities adversely affected a chance to get in the “ground floor” of a profitable industry.

“We are here today to make sure those New Yorkers who saw their futures ruined because the government got it so wrong are now at the front of the line to benefit when the government gets it right,” Fagan said.

Applicants also need to have experience running a business that can show at least two years of profitability. They also must have what the regulations describe as a “significant presence” in New York, having assets like vehicles and real estate property, a state-based residence and a bank account. Credit checks won’t be required.

Chris Alexander, the office's executive director, said financial help will also be provided to those who are granted the licenses, including helping them lease or purchase storefronts in competitive locations and helping create a desirable retail space.

“We’re supporting our entrepreneurs with capital, with real estate and with a real opportunity to build a brand, build a customer base,” Alexander said. “And really get their businesses off the ground in the right way.”

The money comes from a $200 million equity fund included in the 2021 legislation that legalized adult recreational use of cannabis. The industry is expected to generate $4.2 billion in the next five years, and create up to 60,000 jobs.

The state has already distributed licenses to 52 farmers to grow hemp for retail use.

Gia Morón, president of Women Grow, a woman-focused nonprofit promoting equity for Black and brown people in the cannabis industry, said their "community of women and small businesses are thrilled."

“We’ve been waiting for this day,” Morón said.

The officials did not addresstax obstacles that small cannabis business owners might face, including not being able to deduct business expenses from their federal taxes, since cannabis is still considered illegal by the federal government.

The licenses will be distributed regionally, in areas defined by the state's Empire State Development Corp. as part of their economic development grant programs.

Applicants haveuntil Sept. 26 to get their request completed.

Those who don’t want to run a business but want to grow cannabis at home will have to wait a while before learning the rules for private cultivation. Alexander said the Office of Cannabis Management is still finalizing rules for medical marijuana patients who want to grow at home. He could not offer a timetable for recreational users who want to grow their own plants.

Karen DeWitt is Capitol Bureau Chief for New York State Public Radio, a network of 10 public radio stations in New York State. WBFO listeners are accustomed to hearing DeWitt’s insightful coverage throughout the day, including expanded reports on Morning Edition.