News Summary
A coalition of cannabis dispensaries, including ConBud and Housing Works, has filed a lawsuit against New York’s Office of Cannabis Management over new proximity regulations affecting their operations. The changes, which adjust how distances to schools are measured, could force many dispensaries to relocate or face significant financial repercussions. The lawsuit argues that this policy change violates previous guidelines and was implemented without proper rulemaking procedures. A court hearing is set for late August, raising concerns about the impact on the state’s cannabis businesses.
New York – A group of a dozen cannabis dispensaries, including notable names like ConBud and Housing Works, has initiated a lawsuit against the state’s Office of Cannabis Management (OCM) as well as the Cannabis Control Board (CCB). The complaint comes in response to a recent policy change regarding the proximity of cannabis stores to schools, which was filed in the New York Supreme Court in Albany County on August 15.
The lawsuit addresses a correction made by the OCM on July 28, which adjusts the method of measuring distance from schools. Under the revised guideline, the distance is now calculated in a straight line from the entrance of a cannabis store to the nearest property line boundary of a school. Previously, the measurement was based on the distance from the entrance of one cannabis establishment to the entrance of another, which has now impacted 108 licensed dispensaries and 44 applicants with provisional licenses.
Of the 12 dispensaries that are part of the lawsuit, seven have already received their final licenses and are operational, while the remaining five hold provisional licenses. Following the new rule, the OCM has assured the 108 licensed businesses that they can continue operating while seeking a legislative fix that may allow them to remain at their current locations. Conversely, the 44 applicants will be required to relocate and will receive financial support of $250,000 each from a $15 million relief fund to assist with their transition.
The dispensaries involved in the lawsuit argue that the OCM’s revised interpretation of Cannabis Law § 72(6) should be overturned. They believe their businesses complied with the prior guidelines and seek both a preliminary and permanent injunction to restrain the OCM from enforcing this new interpretation. The petition emphasizes that many of these business owners invested their life savings based on the assurances provided by the OCM regarding the compliance of their locations.
Furthermore, the lawsuit claims that the OCM’s change in guidance was made without following the formal rulemaking processes required under the State Administrative Procedure Act. Business owners express concerns that the new proximity regulations will have severe repercussions, such as violating lease agreements and risking financial collapse. They warn that the lack of valid licenses may also jeopardize their relationships with banks and insurance companies.
The construction costs incurred for these businesses have been substantial, ranging from $500,000 to $1 million, and many face a significant financial burden as they attempt to comply with the new restrictions. Eleven plaintiffs among the group are conditional adult-use retail dispensary (CAURD) licensees, which means they are prioritized for licenses due to their ownership by individuals previously involved in the justice system.
The implications of the OCM’s reinterpretation extend beyond financial hardship. Should the enforcement remain in place, business owners may be forced into untenable debt, contravening the aims outlined in the Marijuana Regulation and Taxation Act (MRTA).
OCM Acting Executive Director Felicia A.B. Reid has noted that the agency is actively seeking legislative solutions to the issue, although a definitive outcome is not currently assured. Lawmakers have been working on proposing multiple bills to resolve the situation, yet none have secured formal approval from Governor Kathy Hochul or state regulators to date.
An initial court hearing for this significant lawsuit has been scheduled for August 29, raising questions about the future of New York’s cannabis landscape and the operational continuity of numerous dispensaries affected by these policies.
Deeper Dive: News & Info About This Topic
- The New York Times
- Wikipedia: Cannabis in New York
- Cannabis Business Times
- Google Search: cannabis proximity regulations New York
- Times Union
- Google Scholar: cannabis law proximity New York
- Ganjapreneur
- Encyclopedia Britannica: Cannabis
- ABC News
- Google News: cannabis dispensaries lawsuit New York
Author: STAFF HERE NEW YORK WRITER
NEW YORK STAFF WRITER The NEW YORK STAFF WRITER represents the experienced team at HERENewYork.com, your go-to source for actionable local news and information in New York, the five boroughs, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as New York Fashion Week, Macy's Thanksgiving Day Parade, and Tribeca Film Festival. Our coverage extends to key organizations like the Greater New York Chamber of Commerce and United Way of New York, plus leading businesses in finance and media that power the local economy such as JPMorgan Chase, Goldman Sachs, and Bloomberg. As part of the broader HERE network, including HEREBuffalo.com, we provide comprehensive, credible insights into New York's dynamic landscape.
