by Heather Kovar, CBS 6 News
Published on Monday, March 29th 2021
The bill to legalize marijuana in New York is different than other states that now allow adult use.
In New York, the bill would create a two-tier licensing structure, which would keep those who grow and process, from also selling.
The legislation is aimed to help those who have been disproportionally impacted by cannabis enforcement.
The goal is to keep out any monopoly and to give 50 percent of licenses to minority or women owned enterprises, distressed farmers or even disabled veterans.
“I absolutely am hoping to come into the N.Y. market,” said Charlotte Hanna, Founder and CEO of Community Growth Partners. Rebelle is her adult use cannabis retail store in Great Barrington, Massachusetts.
She’s a New Yorker, but says she’s concerned for new small businesses. She says as retailers-only, you pay an about a 60-percent tax rate on the federal level because you can not deduct anything after cost of goods sold.
“It’s going to be really hard to survive in the current tax environment that we have at the federal level without being able to be vertically integrated,” said Hanna.
Vertical integration is basically one company being able to grow, and sell.
Silver Therapeutics in Massachusetts is now doing both. Its founder Josh Silver is from Saratoga, and his partner Brendan McKee says they want to serve their home state.
“From the very beginning we knew that this cannabis would legalize ideally everywhere and NY of course we’ve been hoping for a long time for it to make that change,” said McKee.
Kaelan Castetter is CEO of Empire Standard and Director of Policy Analysis at Castetter Cannabis Group.
“What it’s going to do is it is going to prevent some of the consolidation and monopolization that we see in other states that have legalized,” said Castetter.
He says there are two notable exceptions to the vertical integration prohibition In New York.