A cannabis dispensary situated too close to a school in New York City, highlighting regulatory compliance challenges.
New York’s cannabis regulatory agency, OCM, discovered that over 152 licensed dispensaries are situated illegally close to schools due to a measurement error. This oversight, deemed a major regulatory misstep, has led to fears of business closures and calls for urgent legislative action. Dispensary owners are forming a coalition to address the crisis while highlighting the potential disruption to the cannabis supply chain.
New York – In a startling revelation, New York State’s cannabis regulatory agency has found that over 100 licensed dispensaries are located illegally close to schools. The Office of Cannabis Management (OCM) has identified more than 152 dispensaries that have failed to comply with the state’s 500-foot setback requirement, which was miscalculated due to a measurement error.
The OCM’s error stemmed from measuring distances from the front doors of schools rather than from their property lines. This oversight has been deemed one of the most significant missteps in cannabis regulation history and echoes past mistakes during California’s medical cannabis legalization in 1996.
Among the dispensaries impacted is Culture House, located at 958 6th Ave., near the iconic Empire State Building. Industry experts, including veteran operator Jeremy Unruh, have noted that such a reversal in regulatory approval for existing cannabis licensees is unprecedented.
Dispensaries have been operating under these incorrect guidelines for over two years, leading to concerns about what could happen if compliance is enforced too suddenly. Acting Executive Director of the OCM, Felicia Reid, emphasized the importance of adhering to current cannabis laws, arguing that postponing compliance could pose unnecessary risks. Several well-known companies, such as Housing Works, Conbud, and PharmaCann, are now facing the prospect of either relocating or shutting down due to this policy shift.
Dispensary owners, including Osbert Orduña, have expressed serious concerns that this sudden regulatory tightening could result in the closure of many businesses unless a legislative remedy is pursued swiftly. In response to these challenges, affected dispensary operators are forming a coalition dubbed “Fucked By OCM,” which will collaborate on strategic approaches to address the ongoing crisis.
This group is calling for state officials to grandfather in affected dispensaries to avoid forced relocations and for accountability from those who were involved in the policy change that led to this situation. A lawsuit against the state is also anticipated as dispensary leaders prepare to initiate legal action in both state and federal courts.
The ramifications of this find extend beyond just the dispensaries themselves; the upheaval could disrupt the entire cannabis supply chain, impacting growers, processors, and other related businesses. New York cannabis businesses now face uncertainty as they look to state lawmakers for a resolution, particularly since the legislature is currently in recess until January.
Meanwhile, the OCM is contemplating interim measures that would allow dispensaries to operate under expired permits while awaiting legislative solutions. As investigations continue, further analysis may reveal additional dispensaries at risk of being non-compliant with the state’s cannabis regulations.
Proposed legislation aimed at assisting the affected dispensaries could be discussed once the legislative session resumes, although the outcomes remain uncertain. In a statement reflecting her concern over the situation, New York Governor Kathy Hochul has directed the OCM to take immediate steps to support the impacted dispensaries, ensuring they are not penalized for past mistakes.
The situation remains fluid, with many stakeholders anxiously awaiting more concrete actions during the upcoming legislative session. The future for New York’s cannabis dispensaries hangs in the balance as the OCM and state lawmakers navigate this unprecedented regulatory challenge.
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