Where Are New York's Cannabis Dispensaries?

A dispatch from the LMCC Show

A couple weeks ago on the way to the Luxury Meets Cannabis Conference (LMCC)—the premier cannabis B2B industry event affectionately dubbed “The Fashion Week of Cannabis”—I received a text from a friend en route from Chicago inviting me out for coffee and a joint, not-so-casually hinting that he wanted to know where to find the good stuff.

“Our corporate weed here sucks!” he said. “Hopefully NYC is off to a better start :).”

Since legalizing recreational cannabis in 2019, Illinois added its adult-use cannabis social equity program—the Cannabis Regulation & Tax Act (CRTA) under the Department of Commerce and Economic Opportunity (DCEO)—one full year after the legislation went through rather than part of the initial process. Three years later, the state’s first and only social equity cannabis manufacturer, Baked Buds of the Near West Side, is only a month old, demonstrating just how ineffective this program has been.

As Illinois continues to rake in $1.5 billion annual cannabis sales, Black and Latino-majority owned dispensaries only make up just 1% of dispensaries, while 88% are majority white-owned by large multi-state operators. This is obvious any time you step foot into a dispensary and realize all of the options are limited to a handful of the same brands all under the same corporate umbrella, usually indoor grown.

And while many states that embraced the corporate weed revolution are facing similar issues, New York was supposed to be different. In addition to prioritizing reparative justice efforts for those impacted by the War on Drugs, the industry was also supposed to be a gateway for uplifting small, craft farmers who all seemed to be on board with pushing for sun grown cannabis and regenerative agriculture as part of their efforts to lead environmental stewardship.

Not only was this a feel-good initiative among the incredibly rare instances of aligned city-state collaboration, but also a market opportunity for differentiation: weed worth traveling for. Lo and behold, I was confronted with a traveler who wanted to drop money on New York weed.

Which made me wonder: New York City off to a good start? It’s a valid question given the confusing proliferation of gray market retail stores throughout the city as farmers and would-be state-mandated dispensary owners remain in the dark about when they’ll finally receive the green light to open after a lengthy two-year roll out.

As it stands, the extremely limited state-mandated facilities, such as Housing Works or Smacked LLC, currently exist as pop-ups, explaining why they often look like someone haphazardly threw up a cheap backdrop in an abandoned Gap store with just slightly more character than the sterile government-sanctioned dispensaries you’ll see across Canada—because they are.

Meanwhile, gray market shops have opened en masse—an estimated 1,400 shops, to be exact—with flashy, Instagram-worthy experiential designs, neon signs, cool wallpapers, and decent sound systems that typically allow customers to consume their untested and unlicensed California branded products on-premise right out in front, judgment-free. This has also created some tension from locals and tourists who feel inundated with incessant cannabis smoke at every turn.

So, as I headed into the conference just days after the last Pipe Dreams podcast where On The Revel co-founder and Cannabis Media Council president Lulu Tsui discussed the current state of affairs, wondering what I should tell my friend, none other than Florist Farms founder Karli Miller-Hornick jumped on social media with this bombshell:

“Shit went down last week. Basically, the government promised that they’d open 20 stores every month starting in January. So, there should be 100 licensed cannabis dispensaries open by now, however I think our total count right now is at nine and that’s causing a major crisis across the industry. Last week, the CAURD equity dispensaries coalition, which is a coalition of licensed equity owners, sent a letter to the Office of Cannabis Management, Cannabis Control Board, and DASNY (Dormitory Authority of the State of New York) saying that they are extremely frustrated with the way that the program is being rolled out.

“On the other side, the Cannabis Association also wrote a letter from the farmers and processors saying that farmers are going bankrupt, that their crops are going bad, and that we need an emergency act to get their products to market because they were promised 100 shelves and there are only nine. There are farmers who risked everything this year thinking that they were going to be able to sell their products in stores around the state, but unfortunately the OCM and DASNY have failed at bringing to market what they promised.

“The state was supposed to raise a $100 million fund and then they were supposed to secure the leases for the dispensaries for the equity partners, and then they were supposed to pay $1 million for the payout of those dispensaries. So far, none of those funds have been raised and the equity stores that have opened are not actually permanently open. They were rush opened as a pop-up and they’ll need to close back down in order to be built out. That causes a million issues. I mean, imagine having to start a business then having to hire and fire all your staff.

“The other thing is that DASNY hasn’t actually signed 100 leases. As far as we know, they’ve only signed like less than ten. They had a full year to sign these leases and get these stores ready, so they are just really behind. I don’t know what they’re doing over there, but they’re not doing their job. So we have no funds raised, we have no store leases signed, and we have no equity stores actually open, and it’s all on DASNY and OCM because they are holding the line there. They aren’t getting job done that they promised and now everybody throughout the entire industry in New York is getting hurt.

Coincidentally, the timing couldn’t be better because LMCC’s keynote speaker was Tremaine Wright, chairwoman of the New York State Cannabis Control Board and a former New York State Assembly member from the 56th district.

Obviously, those who are familiar with my work know that I’ve been a longtime champion of New York tourism. Not only do I have a book on it, but it was pretty clear that the potential for terroir-driven cannabis to become as much of a tourism attraction as Finger Lakes or Long Island wines and the endless list of artisan food and beverage brands that benefitted under New York’s Farm Bill law and carried the torch for Taste NY was going to be a huge economic driver. Why else would there be such an investment and pressure to get it right?

In fact, it was that very bill that inspired much of the ethos for participating cannabis farms—providing tax incentives to reduce the carbon footprint and do business in-state. With cannabis, in particular, it was also among the rare instances where both the city and state seemed equally invested in collaboration.

Given that MSOs have a not-so-good track record of wasting tremendous amounts of energy and water running massive indoor facilities, the support of craft farmers opting for sun grown and regenerative agricultural practices was a win for both sustainability and tourism. After all, the gimmick of seeing endless rows of cannabis plants in a warehouse is not the same experience as touching some grass in the sunshine after a tour from a dedicated farmer—especially when you start to take note of how much power it takes to run the whole operation.

Naturally, I wanted answers not only as a journalist, but as a consumer who feels invested in the success of craft cannabis. Sitting down with Bloomberg’s Tiffany Kary at LMCC, this is what Wright had to say: