Governor Cuomo Announces 30-Day Amendments to Legislation Establishing Comprehensive Adult-Use Cannabis Program in New York

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ALBANY, New York, Feb. 17, 2020 – PRESS RELEASE – Governor Andrew M. Cuomo today announced 30-day amendments to the Governor’s proposal to establish a comprehensive adult-use cannabis program in New York. Specifically, these amendments will detail how the $100 Million in social equity funding will be allocated, enable the use of delivery services, and refine which criminal charges will be enforced as it relates to the improper sale of cannabis to further reduce the impact on communities hit hardest by the war on drugs.

« As we work to reimagine, rebuild and reopen New York, we’re taking every opportunity to address and correct decades of institutional wrongs to build back better than ever before, » Cuomo said. « We know that you cannot overcome a problem without first admitting there is one. Our comprehensive approach to legalizing and regulating the adult-use cannabis market provides the opportunity to generate much-needed revenue, but it also enables us to directly support the communities most impacted by the war on drugs by creating equity and jobs at every level, in every community in our great state. »

Allocation of $100 Million Cannabis Social Equity Fund

Social and economic equity are the bedrock of Cuomo’s proposal to legalize cannabis for adult-use and as part of that, his proposal includes a $100 million dollar fund to help revitalize communities that have been most harmed by the war on drugs.

Through this fund, qualified community-based nonprofit organizations and local governments would apply for funding to support a number of different community revitalization efforts, including, but not limited to:

  • Job placement and skills services,
  • Adult education,
  • Mental health treatment,
  • Substance use disorder treatment,
  • Housing,
  • Financial literacy,
  • Community banking,
  • Nutrition services,
  • Services to address adverse childhood experiences,
  • Afterschool and child care services, system navigation services,
  • Legal services to address barriers to reentry, and
  • Linkages to medical care, women’s health services and other community-based supportive services

The grants from this program may also be used to further support the social and economic equity program.

Under the amended proposal, the Department of State would allocate the funding, through grants administered by Empire State Development Corporation, in collaboration with the departments of Labor and Health, as well as with the Division of Housing and Community Renewal, and the offices of Addiction Services and Supports and Children and Family Services. Final allocations and administration of funding would also be contingent upon approval from the Division of the Budget.

Enabling the Use of Delivery Services

The legalization of cannabis is expected to play an important role in helping rebuild New York’s economy following the damaging effects of the COVID-19 pandemic. In fact, legalization is projected to create more than 60,000 new jobs and spur $3.5 billion in economic activity while generating an estimated $350 million in tax revenue once fully implemented.

Cannabis legalization also has the potential to have a significant economic benefit on distressed areas in New York, providing employment opportunities for all levels of the workforce. As social and economic equity are the bedrock of Cuomo’s proposal, delivery services offer a low-cost entry point into the industry, particularly in communities that have been especially impacted by the war on drugs.

Recognizing this, Cuomo is amending his proposal to allow for the permitting of delivery services as a way to open up access to this new industry even further so more New Yorkers can participate as it grows. As part of this, local governments would have the opportunity to opt-out of delivery services occurring within their jurisdiction.

Criminality of Improper Sales

When establishing a new product market, as Cuomo’s proposal does, there will inevitably be attempts by bad actors to skirt rules and commit fraud for their own financial gain. This makes it critically important to ensure that penalties are carefully calibrated to ensure that all those who wish to participate in this new market are operating on the same level playing field.

Cannabis, however, adds another complicating factor to this dynamic – years of outdated policies stemming from the war on drugs have disproportionately impacted communities of color. Already, New York has taken steps to decriminalize cannabis and as this new market is realized, and it’s critical that criminal penalties are thoughtfully assigned, as to ensure that the progress which has already been made, is not inadvertently reversed.

As such, under Cuomo’s amended proposal, specific penalties will be reduced as follows:

  • Criminal sale in the third degree (sale to under 21 years old) will be made a class A misdemeanor
  • Criminal sale in the second degree (sale of over 16 ounces or 80 grams of concentrate) will be made a class E felony
  • Criminal sale in the first degree (sale of over 64 ounces or 320 grams of concentrate) will be made a class D felony

Cuomo’s proposal builds on years of work to understand and decriminalize cannabis for adult use. In 2018, the Department of Health, under Cuomo’s direction, conducted a multi-agency study which concluded that the positive impacts of legalizing adult-use cannabis far outweighed the negatives. It also found that decades of cannabis prohibition have failed to achieve public health and safety goals and have led to unjust arrests and convictions, particularly in communities of color.

In 2019, Governor Cuomo signed legislation to decriminalize the penalties for unlawful possession of cannabis. The legislation also put forth a process to expunge records for certain cannabis convictions. Later that year, Cuomo spearheaded a multi-state summit to discuss paths towards the legalization of adult-use cannabis that would ensure public health and safety and coordinate programs regionally to minimize the cross-border movement of cannabis products.

Building on that important work, Cuomo’s proposal reflects national standards and emerging best practices to promote responsible use, limiting the sale of cannabis products to adults 21 and over and establishing stringent quality and safety controls, including strict regulation of the packaging, labeling, advertising and testing of all cannabis products. Cannabis regulation also offers the opportunity to invest in research and direct resources to communities that have been most impacted by cannabis prohibition.

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Schaka

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