Equity and enforcement were two leading themes of New York’s legal marijuana market in 2024, according to a package of annual reports published by state regulators last week.
More than half of all adult-use cannabis business licenses have now been awarded to social and economic equity applicants, according to the state Office of Cannabis Management (OCM), while on the enforcement side, officials conducted more than 1,300 inspections, seized more than eight tons of illegal marijuana and issued more than $15 million in fines.
After a slow initial rollout in late 2022, what’s expected to eventually be a massive state marijuana market is finally gaining steam. Late last month, OCM reported that state-licensed retailers had sold more than $1 billion worth of legal cannabis products.
“These achievements highlight New York’s commitment to fostering economic opportunity and ensuring public safety, and signals cannabis as a burgeoning industry in New York,” the agency said in a press release on Thursday, adding that nearly 275 adult-use retailers are now open for business across the state.
Regulators this past year also submitted public comments to federal officials in favor of moving marijuana to Schedule III of the Controlled Substances Act (CSA), the report says, partnered with a cancer care center to hold the state’s first medical cannabis symposium and prioritized sustainability through energy tracking and waste minimization.
“This is only the beginning of what’s possible when we invest in an inclusive and well-regulated industry,” said Tremaine Wright, chairwoman of the Cannabis Control Board (CCB), which oversees OCM. She said the CCB’s industry regulations “set the gold standard for safety, quality, and consumer education in the cannabis industry.”
“From rigorous testing standards to clear labeling and health benefit claim requirements, our framework prioritizes New Yorkers’ well-being,” Wright continued. “Through regular public meetings and outreach programs, we have fostered an environment where community voices help shape our policies and actions.”
OCM’s acting executive director, Felicia A.B. Reid, called the $1 billion sales milestone “a testament to the resilience, hard work, and innovation of cannabis entrepreneurs across New York” and said the future looks even brighter.
“Certainly, this moment underscores the strength of consumer demand for regulated cannabis—more importantly, it firmly demonstrates that a social and economic equity approach to industry is not antithetical to strong economic growth,” she said in a press release. “New Yorkers have placed their trust in a market that prioritizes equity—and OCM remains committed to supporting that mission.”
Reid separately said last week that it’s possible the state could double its adult-use marijuana sales in the coming year, potentially reaching $1.5 billion in cannabis purchases during 2025. Another OCM official said he expected “over 350 dispensaries to open in 2025.”
New York State Office of Cannabis Management
OCM’s annual report also lays out 11 recommendations that regulators said will help “support and strengthen” the state’s cannabis landscape. Those include doubling down on enforcement and efforts to support social equity; prioritizing public education, including by publishing materials in languages other than English and making interpreters available at events; encouraging further study into marijuana’s potential benefits and risks; and expanding the state’s medical marijuana system, for example by encouraging insurance companies to cover medical cannabis.
Officials also recommend expanding options for people to grow their own marijuana by authorizing licensed nurseries and microbusinesses to sell seeds and seedlings to both adults and medical marijuana patients and caretakers. And, building on its past work on sustainability, OCM says the state should create financial incentives and a cannabis-specific recycling program meant to reduce waste and encourage more sustainable packaging.
“Moving forward,” Reid said, “OCM remains focused on responsible growth, public health and safety, and ensuring economic inclusivity as this approach has already made New York a national leader in cannabis regulation.”
In addition to the 79-page annual report, OCM also released a seven-page report on the state’s enforcement of cannabis laws and a 41-page report from the agency’s chief equity officer looking at how regulators are preserving the state’s medical marijuana market and supporting social equity licensees.
New York State Office of Cannabis Management
In the enforcement report, OCM Director of Enforcement and Investigations (E&I) Daniel Haughney noted that OCM this year gained the ability to conduct inspections at unlicensed cannabis retailers and padlock them for violations.
“E&I’s enforcement efforts have a direct, often immediate, market impact,” Haughney said in the report. “Where OCM investigations have resulted in enforcement actions, licensed retailers nearby have seen next day and out week sales performance skyrocket.”
The investigations and enforcement actions also “remind communities that illicit operators are frequently contributing to other local public safety concerns,” he added, noting that “at illicit locations, E&I teams have discovered unlawful firearms, psilocybin, methamphetamine, narcotics, armor piercing ammunition, and cannabis products being manufactured and packaged in exceedingly unsanitary conditions.”
The report says OCM will continue to expand its enforcement actions in the months ahead. “Building on the initial efforts of the Governor’s Illicit Cannabis Enforcement Task Force,” it says, “OCM will expediently and significantly expand its enforcement resources to ensure sustained pressure on the unregulated market. Working with other state and local law enforcement agencies, we will continue to follow the illicit cannabis supply chain to identify and shut down the networks supplying the illicit cannabis operations in New York.”
“Our actions remain focused against unlicensed cannabis retailers,” the enforcement report continues, “which undermine New York State’s ability to build a truly equitable market with the power to deliver new resources to schools and communities disproportionately impacted by cannabis prohibition statewide.”
All told, authorities with the Illicit Cannabis Enforcement Task Force—which OCM refers to as “ICE-T”—over the past year seized more than 7,000 pounds of marijuana flower, 620 lbs. of concentrate and more than 9,200 lbs. of infused edibles—products the report values at more than $68.5 million. OCM attorneys also worked with “more than 145 landlords who have evicted tenants or otherwise had unlawful operators vacate their premises.”
“By taking decisive action against unlicensed cannabis businesses,” the office said, “ICE-T has a direct role in safeguarding public health and safety, consumer confidence, and the integrity of the State’s social and economic equity-driven, legal cannabis market.”
New York State Office of Cannabis Management
In the equity and medical marijuana-focused report, OCM’s acting chief diversity officer, Tabatha Robinson, said the agency’s Social and Economic Equity (SEE) Team has worked with other stakeholders to create “one of the strongest equity programs this nation has ever seen.”
“We have surpassed the statutory goal for social and economic equity licensure. We have facilitated demographic representation in our supply chain across race, ethnicity, gender, and geography,” Robinson said, adding that more than “90% of those retailers entered the market through an equity program.”
Of all adult-use licensees in the state, the report says, 33 percent are women-owned, 23 percent are majority-minority owned, 9 percent are majority Hispanic-owned and 8 percent are majority Black-owned. More than two thirds (68 percent), meanwhile, are majority-non-minority owned.
In its package of reports last year, OCM said the state should continue to update its social and economic equity plan as well as to expand enforcement efforts against unlicensed retailers. Other health and safety efforts should include investments in public safety and monitoring of public health outcomes, the office said at the time, as well as in addressing gaps in public education as well as scientific understanding of the substance and its health effects.
Among OCM’s other recommendations a year ago were that the state continue prioritizing the expansion and reinforcement of its medical marijuana system, conduct background checks on license applicants, expand the definition of crops and livestock to include cannabis to “normalize cannabis as a legitimate crop” and allow for certain tax deductions, continue to monitor environmental impacts of the new industry and allow adults to grow marijuana at home for personal use.
This past October, meanwhile, the office in a separate report acknowledged what it called “growing pains” during the launch of the New York’s adult-use market—including a slow market rollout, leadership controversies and so-called “predatory deals” around the state’s marijuana social equity fund—but also said they were confident the state was poised for success.
Over the past several months, legal marijuana sales in New York have picked up significantly. Regulators have said that’s the result of more licensed businesses opening as well as what they describe as the successful crackdown on unlicensed shops.
New York State Office of Cannabis Management
“Earlier this year, my administration took critical steps to promote progress and economic opportunity within New York’s budding cannabis industry,” Gov. Kathy Hochul (D) said in a press release last week, “including signing new enforcement powers into law that expedited the closure of unlicensed storefronts and, as a result, bolstered our legal market.”
This spring, officials in New York City launched Operation Padlock, an enforcement initiative meant to shutter illegal storefronts. Since then, licensed shops that were open before the operation began have since seen sales climb 105 percent, according to an OCM survey.
In November, Assembly Majority Leader Crystal Peoples-Stokes called for the state to extend financial aid to retail operators operators struggling under high-cost loans from a social equity fund created as a core part of the legalization program.
Later in the month, Hochul signed two new cannabis-related bills into law—one to revive the Cannabis Growers Showcase program, where producers sell products directly to consumers at farmers market-style events, and another clarifying that cannabis is categorized as an agricultural crop in the state.
The governor argued in June, meanwhile, that there’s a direct correlation between stepped-up enforcement and “dramatically” increased legal sales. A report by state officials last year found both “growing pains” and “successful efforts” in New York’s marijuana market launch.
In August, the governor lauded what she called the state’s “smokin’ hot” marijuana market, as the retailers in state passed the half-billion-dollar mark in legal sales since the market’s launch.
The governor also said in June that the state’s escalated enforcement actions against illicit marijuana shops is resulting in a significant increase in legal sales at licensed retailers.
She made the comments amid criticism from equity-focused activists over what they see as a “corporate takeover” of the cannabis market, citing reporting about the administration dismissing concerns from state officials about a “predatory” private equity loan deal the state approved to provide funding for startup cannabis retailers.
Certain advocates say Hochul has “falsely” blamed the legalization law itself for the state’s troubles with the illicit market, without taking responsibility for the administration’s role. To that end, there has been criticism of the governor’s ousting of Chris Alexander as executive director of OCM last year.
In an attempt to rein in unlicensed sales, the governor in February called on big tech companies such as Google and Meta to “do the right thing” by taking steps to stop promoting illicit marijuana shops, which have proliferated across the state.
Meanwhile, New York officials this summer rolled out a broad plan to encourage environmental sustainability and set energy use standards within the state’s legal marijuana industry. It’s part of regulators’ broader goal of promoting economic, environmental and social sustainability in the emerging sector.
In June, state regulators also formally approved rules to allow adults 21 and older to grow their own cannabis plants for personal use.
In September, meanwhile, the state announced it’s preparing to deploy up to $5 million in grants funded by marijuana tax revenue as part of an effort to reinvest in areas disproportionately impacted by the the war on drugs. OCM said the awards aim “to redress a wide range of community needs—from housing to childcare to job skills training and many areas in between.”
Separately, a group of 18 organizations recently wrote to New York’s governor to express dismay at what they described as marijuana regulators’ “efforts in service of big corporations at the expense of small business and equity outcomes” during the latter half of last year.
The Congressional Cannabis Caucus Has New Leaders As The Push For Federal Reform Continues Into 2025
Equity and enforcement were two leading themes of New York’s legal marijuana market in 2024, according to a package of annual reports published by state regulators last week. More than half of all adult-use cannabis business licenses have now been awarded to social and economic equity applicants, according to the state Office of Cannabis Management Read More
