Mum's the Word on New York Settlement Deal

New York regulators did approve final rules for hemp operators on Friday.

New York operators raged against regulators during a hearing with the Cannabis Control Board on Friday, particularly for the board’s lack of action related to the injunction on conditional adult use retail dispensary licensees.

Regulators provided no updates on a settlement deal that would allow hundreds of licensed retailers to move forward with their ventures. Various operators that provided testimony criticized the board for not voting on the issue.

“I’m speechless. I don’t know what to say. I’ve never got up here and had nothing to say,” CAURD licensee Zymia Lewis told regulators during the public comment time. “I’m still not open. I asked for a little clarity last time. I still know nothing. I still have no money. We don’t know how to move forward.”

Hemp operators raised their own concerns as well, criticizing the board for making zero changes to finalized rules proposals on intoxicating hemp, which received hundreds of public comment submissions.

That’s despite a federal court ruling earlier this week that declared emergency rules issued by the board last summer fell afoul of state’s the emergency rulemaking process.

“The OCM has issued dozens of manufacturing and distribution licenses for cannabinoid hemp and thousands of retail licenses, collecting millions of dollars for a channel that they have functionally closed with today’s regulatory ruling,” said Jeff O’Neil, founder of Industrial Arts Brewing, told the board.

Below is just a sampling of the testimony presented at Friday’s meeting:

Board members of the body also green lit registration renewals for nine out of the eleven registered organizations involved in the state’s medical cannabis program.

Tepid Enforcement for Out-of-State Operators

New York’s emerging legal marijuana market, one of the largest potential markets in the United States, is facing additional disruption from large, out-of-state cannabis corporations. These corporations are reportedly flouting state regulations to gain market share, often at the expense of small local farmers and brands.

The Office of Cannabis Management, the umbrella state agency responsible for regulating the market, is aware of these violations, according to a leaked audio recording of a top OCM official, NY Cannabis Insider reported this week. However, the OCM reportedly is hesitant to enforce regulations against these companies, fearing disruption to the supply chain.

The aggressive tactics of these out-of-state companies are putting a strain on New York’s small farmers and operators, further compounded by the slow pace of dispensary openings. Only a small number of stores are currently serving a large number of licensed growers and processors.

These brands often engage in practices such as offering products on consignment with extended payback terms, despite such practices being against OCM regulations.

Adam Jackson

Adam Jackson writes about the cannabis industry for the Green Market Report. He previously covered the Missouri Statehouse for the Columbia Missourian and has written for the Missouri Independent. He most recently covered retail, restaurants and other consumer companies for Bloomberg Business News. You can find him on Twitter at @adam_sjackson and email him at

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