California Investors and MedMen Drama Take Stage at Latest NY Legalization Hearing
Lawmakers’ budget hearing focused on the interplay between medical and adult use regulations, and protecting opportunities for New Yorkers.
New York State lawmakers held a joint legislative budget hearing yesterday to discuss Governor Cuomo’s proposed legislation for the legalization of adult-use cannabis. Senators and Assembly members raised a number of questions about the proposal, the majority of which were about licensing, equity programs, and how legalization for recreational use could affect the state’s five-year-old medical program.
Assemblymember Crystal Peoples-Stokes (D-141) raised concerns about the number of out-of-state companies aiming to gain a foothold in New York’s recreational market. “I live in Buffalo because I represent that district, and literally for the entire year of ‘19, I would say there’s been at least two or three meetings a week with potential investors from California who come to my office,” said Peoples-Stokes. “I understand what they see: There’s an opportunity here, a big opportunity. But at the same time, I need to make sure we’re protecting New Yorkers’ interests to be in business. How do you propose to do that?”
Counsel to the Governor Alphonso David, who fielded most of the questions yesterday, said the legislation aims to reduce barriers of entry in two ways: first, by prohibiting vertical integration, or when a single company controls its own cultivation, manufacturing, distribution, and retail operations. While New York’s medical cannabis program permits vertical integration, the proposed legislation would prohibit the practice so as to increase the number of available licenses, thus providing more opportunities for those disproportionately affected by prohibition to enter the legal market. “We’ve broken up that structure in order to ensure that more people can participate in this new industry,” David said.
The prohibition of vertically integrated companies will not apply to current medical cannabis licensees, who will be given the option to enter into the recreational market in exchange for an investment in the program with an amount that has yet to be determined. “That provides us the additional capital that will be helpful to provide support to minorities and disadvantaged community members who may be interested in participating in this program.”
Peoples-Stokes asked David whether there would be a cap on the number of current license-holders that would be allowed to invest in the recreational program. “No, I don’t think we want to, in legislation, identify a specific percentage,” David responded. “We want to be careful that we’re not being overly restrictive or overly expansive.”
Assemblymember Walter Mosley (D-57) raised concerns about MedMen, a California-based company that currently holds one of ten medical cannabis licenses in New York and, with its $682-million dollar acquisition of PharmaCann, could hold two. MedMen has recently made headlines after former CFO James Parker filed a lawsuit in California alleging that company executives misrepresented finances, spent money extravagantly, and used homophobic and racist slurs. Since Parker filed, the New York Medical Cannabis Industry Association cut ties with the company.
“I know that MedMen is in the process of merging with another medical license holder in New York State. What type of impact is that going to have with that merger?” asked Mosley, who also asked whether the company will be allowed to enter the recreational market.
“One, I would not conclude at this point that the merger has been approved,” David responded. “The merger is still under review by the state. Second, the state is also aware of those allegations from California, and is reviewing those allegations to determine what impact, if any, it would have on their continued ability to function in the state,” he said.
What will happen to New York State’s medical cannabis program if recreational use is legalized was a central focus of the hearing. Senator Diane Savino (D-23) pointed out the discrepancy between the state’s medical program, which prohibits smoking cannabis, and the proposed legislation, which would allow recreational users to purchase flower product. “Do you not see a conflict? So, if I’m an adult-use purchaser, assuming we pass adult-use, I can purchase flower product for smoking, but if I’m a medical patient, I can’t smoke the product?”
“Correct. I think there’s a little bit of a conflict, but I think we also want to make sure we’re promoting public health as well,” said David, adding the state is looking at the issue.
While some legislators continued to question the purported benefits and possible dangers of legalization, most focused instead on hammering out the details and praising the potential benefits to public health, criminal justice reform and the state economy. “They actually used cannabis in the bricks for the pyramids in Ancient Egypt,” remarked Senator Liz Krueger (D-28), Chair of the Finance Committee. “Apparently, they held up very well. Just saying.”
New York's medical marijuana industry fears threat of legal recreational pot
ORANGE COUNTY, New York (WABC) --
There is a battle going on in the marijuana industry in the state of New York.
Supporters of medical marijuana claim that without protection for medical pot stores, they'll be driven out of business should recreational marijuana be legalized, as is likely.
"Our industry would simply evaporate. It would go away," said Jeremy Unruh of PharmaCann.
About 60 miles north of New York City in Orange County, nestled between the farms, the fear is that legalization of recreational pot will push the medicinal industry to extinction.
"The existing, the registered organizations are a very very important foundational piece," said Unruh.
Gov. Andrew Cuomo unveiled his proposal for recreational pot last month. The medical industry argues it doesn't allow them to stay competitive.
PharmaCann is one of only 10 medicinal production facilities allowed in New York, a highly regulated state.
The result is medicinal pot in the Empire State is expensive. And the theory is patients will abandon this product and opt for the less expensive recreational.
That's why medicinal is asking Albany to allow them to serve recreational pot as well.
But that clashes with social justice advocates who argue that targets of criminal enforcement, low-income minority communities, should reap the financial rewards.
"That market is going to be gigantic," said Unruh. "We're only a very small piece of that. There's still plenty of opportunity."
A spokesperson for the governor tells Eyewitness News: "As this process moves forward, we will continue to engage all stakeholders to ensure New York's medicinal cannabis program is supported to serve the needs of all existing and future patients."
"Senior citizens in general, I have older family members that use it, and they would be completely lost if they didn't have some sort of medical guidance to shepherd them through the path," said PharmaCann Director of R & D Chris Diorio.
There is of course also the issue of serving patients with the right product.
"If somebody had a poorly functioning liver and took cannabis orally or a capsule with cannabis oil orally, their metabolism is going to change the effect," said Diorio.
The governor's proposal is now being debated by the legislature, with an expected deal to be reached sometime before April.
Recreational marijuana: Police, doctors and educators fighting legalization in New York
The anti-marijuana mobilization comes as Assembly Speaker Carl Heastie, D-Bronx, suggested the political debate may extend beyond the March 31 state budget deadline sought by Cuomo.
Story Highlights
- Marlboro cigarette-maker Altria invested $1.8 billion in a leading Canadian cannabis firm
- Some anti-marijuana stances are connected to tobacco and alcohol companies investing in cannabis
- Anheuser-Busch InBev, maker of Budweiser has $50 million tied to creating marijuana-infused drinks
- When the program is fully implemented, state officials estimate about $300 million per year in taxes
New York’s recreational marijuana battle sits on the frontline of a generational war over American cannabis laws. As debate heats up, USA TODAY Network New York is compiling answers to key questions about legalized cannabis. The findings will be updated each Monday as New York considers joining the 10 states that allow adults to use marijuana.
A growing opposition movement across law enforcement, education and public health is attacking the politically charged push to legalize recreational marijuana in New York.
Many of the powerful advocacy groups suggest passage could lead to spikes in drugged driving and marijuana-related health risks ranging from smoking hazards to psychotic episodes.
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Some warn New York’s sudden rush towards legal marijuana ignores how profit-driven corporations hooked generations of Americans on alcohol, cigarettes and opioids, killing millions and straining public resources.
“We have many different intoxicants in our society, none of them are particularly helpful, and I think adding one more is not in society’s interest,” said Dr. Thomas Madejski, president of the Medical Society of The State of New York.
Much of the pushback to Gov. Andrew Cuomo’s legal cannabis plan focused on the threat to children, despite the fact it would restrict use to 21 and above.
Cuomo
proposed legalizing recreational marijuana as part of the state budget for the fiscal year that starts April 1, but some lawmakers are suggesting the program's approval could be delayed until closer to the end of the legislative session in June.
"I'm not willing to accept deferral, and I'm going try like heck to get it done in the budget," Cuomo said Feb. 5. "But were going to get it done one way or the other."
Opposition builds
In the meantime, opponents are urging Cuomo and lawmakers to reconsider their support.
“Even at 21, kids’ brains are not fully mature and they are at higher risk,” said Dr. Henry Neilley, an Albany-area pediatrician and a leader of the state branch of the American Academy of Pediatrics. “The biggest one is cognitive effects on the brain, and not only the younger they are when they start but the more they use marijuana, there is a long-term health risk involved."
Peter Kehoe, executive director of state Sheriffs' Association, speaks at a news conference in Albany on Feb. 7, 2019, about law enforcement's concerns with legalizing recreational marijuana in New York. (Photo: Joseph Spector, Albany Bureau Chief)
While opposition groups want more debate on the issue, they support expanded marijuana decriminalization, such as expunging criminal records for low-level offenses.
But some police officials said they continue to make arrests for marijuana, particularly sheriffs' departments near the border with Vermont and Massachusetts, where pot is legal.
"We took an oath as sheriffs of New York state to keep our communities safe, and by legalizing marijuana, we will become less safe," Oneida County Sheriff Robert Maciol, who is president of the state Sheriffs' Association, said during a news conference Feb. 7 in Albany.
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Advocates undeterred
On the pro-marijuana side, advocates disputed that states with recreational cannabis have unique problems with drugged driving and teen use, calling many studies biased or flawed.
“States around the country are demonstrating that regulating marijuana works,”
said Mason Tvert, a Marijuana Policy Project spokesman. “It allows folks to purchase marijuana safely, legally and from licensed, taxed businesses, rather than on the illegal market.”
If New York moves ahead, it would join 10 states that have legalized recreational marijuana. But legalized sales in New York wouldn't begin until at least April 1, 2020, according to Cuomo's office.
The Democratic governor's plans would create a licensing program for growers, distributors and retailers, impose a 20 percent state tax and a 2 percent local tax and allow counties and large cities to ban marijuana sales locally.
The goal, supporters said, is to limit low-level marijuana arrests that can lead young people, particularly minorities, to end up in jail, hurting their future.
When the program is fully implemented, state officials estimate about $300 million per year in taxes, adding to the
country's already $8 billion-plus cannabis industry.
A majority of the money should go back into poor communities most hurt by the war on drugs, according to the Drug Policy Alliance:
“Given New York’s appalling history with racially biased marijuana enforcement, we must be bold and innovative in creating justice and equity," said Kassandra Frederique, the group's state director.
Hannah Kenny, a Harrison resident who voted for marijuana legalization in Colorado, speaks about why she came to regret her vote at the state Capitol on Mon., Feb. 11, 2019. (Photo: Jon Campbell / Albany Bureau)
Big marijuana’s rise
Some of the anti-marijuana stances are connected to tobacco and alcohol companies investing in the cannabis industry.
For instance, Marlboro cigarette-maker Altria invested $1.8 billion in a leading Canadian cannabis firm poised for expansion stateside. Anheuser-Busch InBev, the maker of Budweiser, also has
$50 million tied to developing marijuana-infused drinks.
Meanwhile, alcoholic beverage giant
Constellation Brands, based in Victor, Ontario County, has investments in Canadian cannabis business Canopy Growth, which is building a $150 million hemp processing hub in the Binghamton area.
While leery of alcohol industry influence, Madejski emphasized the suspect ties between cigarettes and marijuana.
“It’s being promoted aggressively by this growing big tobacco morphing into big marijuana industry, which has new addictive products to sell to people,” he said.
Madejski noted Altria also
made a $12.8 billion investment in e-cigarette maker Juul Labs, which is at the center of an ongoing federal government crackdown on youth vaping.
"Legalization absolutely is the right thing to do," New York City Mayor Bill de Blasio said at a state budget hearing Feb. 11. "But it must be done in a way that protects health and safety and does not create a new corporatization of a new industry that causes the same problems we saw with the tobacco industry and the pharmaceutical industry."
TIMELINE: Gov. Andrew Cuomo's changing position on marijuana
Efforts in Albany
Smart Approaches to Marijuana, a Virginia-based group which says it's funded by small donors and advocates, has formed a New York chapter aimed at preventing the commercialization of marijuana.
With opponents from the lower Hudson Valley, the group rallied Feb. 11 at the state Capitol, standing next to a banner that used Cuomo’s words against him when he called marijuana
a “gateway drug” as recently as 2017.
Stephanie Marquesano, an Ardsley attorney and founder of the harris project, speaks out against marijuana legalization at the state Capitol on Mon., Feb. 11, 2019. (Photo: Jon Campbell / Albany Bureau)
“We’re asking the governor and our legislators to simply slow down,” said Stephanie Marquesano, an Ardsley, Westchester County, attorney whose advocacy group, the harris project, is named after her late son who used marijuana before moving on to prescription pills.
“To that end, New Yorkers would benefit from a thorough examination of the states that have legalized marijuana for recreational use and carefully weigh the true impact.”
Hannah Kenny, a Harrison, Westchester County, resident who had voted for marijuana legalization in 2012 when she lived in Colorado, said she regrets her vote.
“Overnight, there were billboards up all over the place,” Kenney said at the news conference. “There were signs on the sides of buildings. The Denver Post was running constant articles about cannabis this and that, and the marketing push that was directed at children was like (snaps) that.”
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Studying marijuana
Indeed, much of New York’s cannabis debate has built upon what’s happening in other states already allowing recreational marijuana.
Opposition groups cited various data from states like Colorado on increases in teen marijuana use and deadly crashes linked to stoned driving.
Most research, however, remains inconclusive as to the role played by marijuana legalization, a fact that some contend should be enough reason to delay New York’s race to legal cannabis.
Further, medical studies of cannabis have recently gained traction after long being hindered due to its federal Schedule I classification alongside illegal drugs like heroin.
New York has had a medical marijuana program since 2016, and it would face a significant overhaul
if recreational marijuana is approved.
School groups and county health officials in New York said the state is currently fighting the opioid epidemic and looking to further lower cigarette use.
Legalizing marijuana would be a step backwards, they said.
"Why are we giving them (young people) any more harm with the possible access to recreational marijuana?" asked Kyle Belokopitsky, executive director of the state Parent Teacher Association
"This will not serve our public; this will not serve our state."
New York's proposal comes after a thorough, yearlong review of other states' experiences, Alphonso David, Cuomo's counsel, testified at a budget hearing Wednesday.
He said New York needs to act because other states have legalized marijuana and because of the growth in the illegal market. He said about 800,000 marijuana arrests would be sealed under the bill, while other cases could be reheard in court.
State officials testified they don't believe marijuana would be a gateway drug and could actually lower opioid abuse.
"We have the opportunity to establish a strong framework that addresses the significant social justice, economic justice, public safety and public health concerns that confront us today," David said.
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Protecting vulnerable New Yorkers
Some health experts proposed raising the minimum age to 25 from 21 to limit marijuana’s damage on developing minds.
Yet many asserted the potential normalizing of the drug through legalization endangers children, regardless of the minimum age.
Young people could inadvertently gain access to marijuana edibles or get addicted as teenagers, warned Sarah Ravenhall, executive director of the state Association of County Health Officials.
Sarah Ravenhall, executive director of the state Association of County Health Officials, spoke out against recreational marijuana during a news conference in Albany on Feb. 7, 2019. Joseph Spector, Albany Bureau Chief
"We are equally concerned about the lack for research available to demonstrate long-term health outcomes of such a program," she said. "This gap in evidence could hinder our ability to stand prepared to mitigate unforeseen health consequences."
The state branch of the American Academy of Pediatrics supported Cuomo’s plan for age 21 and above, as well as diverting marijuana tax revenue to substance-abuse outreach and health education.
But the group also
urged lawmakers to consider other broad regulations to limit the harm to children, such as outlawing any cannabis products that could appeal to kids.
While pushing for 25 and up, the Mental Health Association in New York State cited studies that have shown marijuana can cause symptoms of serious mental health problems, such as schizophrenia, anxiety, depression and sleep disorder.
“Let’s not go and just pass it immediately, let’s figure this out and have real discussions that are framed to respond to the public policy concerns,” said Glenn Liebman, the group’s chief executive officer.
meets 
in CNY. 
Some are already kicking up their heels. 
fun fact. CNY is wine country also.
) 
Want to empower an MJ user? Then you let them grow their own. Can you grow your own tomato plants? Can you eat your own home grown tomatoes? Can you give a few to a friend? 
