Starting a cannabis company in New York? We’ve put together a state-specific guide covering everything from available license types to fees, regulations, and what you should include in a New York cannabis business plan. Jump to a section by clicking below, or go straight to our sample cannabis business plan.
September 1, 2021: New York State Senate approves Governor Hochul's nominees for key recreational cannabis oversight positions. Read the story here.
New York became the 16th state to legalize cannabis in March of 2021, and just the third to do so via state legislature. Adults over the age of 21 can possess up to 3 ounces of cannabis. An adult can grow up to 6 plants (3 mature and 3 immature) but cannabis grown at home cannot be sold and is intended for personal use only. The law will allow for the commercial sale of cannabis via licensed establishments, but the program is not expected to begin until late 2022.
The legal cannabis market will be run by the New York Office of Cannabis Management (OCM).
New York legalized cannabis for medical use in 2014. Patients are required to have a recommendation from a state-registered doctor or nurse practitioner. The medical program is one of the strictest in the nation, allowing only for vaporization (smoking is prohibited), ointments, and tablets/lozenges. The state's medical marijuana program has only 140,000 patients, accounting for less than 1% of the total population. In 2021, medical marijuana sales are expected to reach $300 million. The state only allowed ten licensed businesses to operate, each with up to four dispensaries and a cultivation facility. Medical marijuana businesses are all vertically integrated.
Conversely, the adult-use program is expected to allow as many as 900 licenses and will encourage social equity, with a goal of 50% of licenses awarded to applicants who have been harmed by the prohibition of cannabis.
While the medical program no longer issues licenses, the new adult-use market is expected to offer a several license options when it launches.
Retailer (aka dispensary): This is a retail storefront where anyone 21 and over can purchase marijuana.
On-Site Consumption: The state law allows for licenses for on-site consumption will be allowed. Owners of on-site consumption licenses cannot have any other license type. Details on the license will be developed by the OCM.
Cultivator: These businesses, also called grow operations, grow cannabis plants indoors or outdoors. Marijuana is then either sold through a dispensary or sold to a business that will create products with it, such as edibles or oils.
Processor: Cannabis processers (or manufacturers) buy cannabis from cultivators or other product manufacturers, then produce items like edibles and extracts.
Nursery: Cannabis nurseries sell only clones, immature plants, seeds, and other agricultural products.
Testing lab: Marijuana testing labs use methods like liquid or gas chromatography to analyze products for CBD and THC content, pesticides, terpenes, bacteria, fungi, and heavy metals, to name a few.
Delivery: These businesses can transport cannabis to and from licensed cultivators, manufacturers, and distributors, but not to or from dispensaries/retailers. They also cannot arrange for testing or perform quality assurance. It is unclear whether New York will allow delivery to the end consumer
Microbusiness: Microbusinesses are cannabis licenses for small scale opertation. Details on microbusinesses have yet to be announced.
Nursery: A cannabis nursery can produce clones, seeds, and immature plants to be sold to licensed cultivators.
Ancillary business: If you don’t want to grow or sell cannabis in New York, there are plenty of other ways to be part of the booming cannabis industry. You can create a marijuana app, payment processing service, advertising agency, consulting firm, pest management product, accounting firm, automated plant watering system, security service, packaging labeling service, or legal firm--and that’s just the tip of the iceberg!
Local governments may forbid cannabis companies or certain locations, so check city and county regulations. Municipalities have until the end of 2021 to opt out of the New York adult-use cannabis program via referendum.
Application fees: The application fee schedule is still being finalized.
License fees: The annual licensing fee schedule is still being finalized.