On Thursday, July 14, 2022, the New York State Cannabis Control Board (CCB) of the Office of Cannabis Management (OCM) held its 13th public meeting. There, the CCB passed important regulations relating to Conditional Adult-use Retail Dispensary (CAURD) licenses, CAURD application format and procedure, and granted additional Conditional Cultivator Licenses. These developments mark a milestone for adult-use recreational cannabis in New York State.
I. CAURD Licensure
The biggest development from the CCB meeting was the passage of the CAURD Resolution [no. 2022-20] by a unanimous vote. The CAURD Resolution will license the first legal, recreational adult-use dispensaries in New York State and will position the business owners most impacted by the prohibition of cannabis at the front of the line to receive a license.
CAURD licenses will first be awarded to those who:
1. Are a justice involved individual, which is defined as an individual who:
i. Has had a cannabis-related offense that occurred prior to March 31, 2021; or
ii. Has a parent, legal guardian, child, spouse, or dependent with a cannabis related offense prior to March 31, 2021;
and
2. Are a small business entrepreneur, which is defined as owning at least 10% of a business that has had a net profit for at least two years of operations.
This is a huge step toward social equity in cannabis law, which the CCB has vocally made a priority when shaping the State’s cannabis regulations.
The OCM has drafted a Frequently Asked Questions” document and general guidance for program clarification, found on the OCM website. There will also be a learning and listening series called “Get Ready, Get Set” to prepare eligible New Yorkers for CAURD licensure and allow them to hear from the communities most impacted by cannabis over-policing. “Get Ready, Get Set” will focus on engaging with those with cannabis convictions, those with family members with cannabis convictions, and community organizations that provide support to these individuals.
II. CAURD Application
The CCB also passed a resolution [no. 2022-21] setting out the CAURD application requirements. The application, which is expected to open in August 2022, requires individuals to submit:
1. Materials proving a qualifying cannabis-related conviction and the residency of the justice involved individual at the time of the offense;
and
2. Details and documentation related to the applicant’s qualifying business or not-for-profit, including:
i. The nature of the business and associated tax documents;
ii. Ownership information of the applicant, including financial disclosures for “true parties of interests”; and
iii. Other basic applicant information to assist the OCM in its review.
The CCB also created a process to open the CAURD application window once it is finalized. The application opening date will be posted on the OCM website no less than 14 days before it is opened. In the meantime, the CCB will be traveling across New York State making applicants aware of the opportunity and the materials needed to apply.
When it is finalized, the application will be available online, straightforward, and not overly burdensome. The CCB stressed that the application will be accessible to all that seek to apply. However, applicants must submit a $2,000 non-refundable application fee.
III. Additional Cultivator Licenses Approved
Along with the strides toward recreational dispensary licenses, the CCB also approved 20 additional Conditional Cultivator Licenses, bringing the total number of Cultivators in the State to 223; the majority of which are small farmers. Cultivators lay the foundation of the State Cannabis Program by providing the supply that will one day be sold to adult-users.
IV. Medical Cannabis Program Proposed Regulations
Beyond adult-use, the CCB also voted to file revised regulations of the State’s Medical Cannabis Program for a 45-day public comment period. The revisions emphasize the importance of environmental sustainability in the cannabis industry and include:
- A streamlined patient registration process to allow for auto registration;
- Revised packaging, labeling, marketing, and advertising guidelines to align with the proposed adult-use regulations introduced in June and to address sustainability concerns;
- Removed prior written approval requirements for product brands;
- Revised pharmacist supervision requirements, mandating that they be in-person;
- Added several clarifying definitions;
- Proposed annual benchmarking to track a cultivator’s energy and water consumption;
- Revised standards for cultivator lighting and dehumidification systems; and
- Standards for the disposal of plant waste.
Barclay Damon’s Cannabis Team will continue to closely monitor developments pertaining to the adult-use cannabis regulations and applications.
If you have any questions regarding the content of this alert, please contact Jason Klimek, Cannabis Team co-leader, at jklimek@barclaydamon.com, or another member of the firm’s Cannabis Team.