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Nonprofits Awarded NYS Cannabis Dispensary Licenses Include Three Based in NYC

By:
S.J. Steinhardt
Published Date:
Nov 22, 2022

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New York state announced its first batch of licenses for retail dispensaries of recreational cannabis on Nov. 21, and the nonprofit recipients include three New York City-based organizations, the New York Times reported.

Of the 36 licenses issued by the Cannabis Control Board, 28 were awarded to individual businesses and eight to nonprofits, the state Office of Cannabis Management announced. These initial dispensary licenses were given in accordance with the state's Conditional Adult-Use Retail Dispensary (CAURD) program, under which priority is given to people with past drug convictions and their family members.

Three New York City-based nonprofits—Housing Works, The Doe Fund and LIFE Camp—were among the groups granted licenses, according to the Times.

Housing Works serves people who are homeless and living with HIV and AIDS. The organization said in a statement that it was “honored” to receive a license, adding that having one would help support their mission.

The Doe Fund seeks to to end the cycle of homelessness and recidivism through work programs, helping homeless and formerly incarcerated men rebuild their lives by providing economic opportunity, housing, career training, and supportive services.

LIFE Camp provides youth and families that have been impacted by violence the valuable tools they need to stay in school and out of the criminal justice system. Founded in 2002 by Erica Ford, it is believed to be the first Black woman-led nonprofit to receive a license, according to the Times.

Ford told the Times that most of the organization's staff had negative experiences  arising out of decades of enforcement of criminal laws against cannabis.  She said that being considered for a license gives her hope “that working together, we can make some real transformation.”

The Times reported that New York is the first state to specifically reserve licenses for nonprofits. It noted that there is uncertainty over how those licenses might affect the groups’ federal tax status, given that cannabis remains illegal at the federal level.

Nineteen of the 28 licenses granted to individuals who belong to racial and ethnic minority group, and 20 were from areas with some of the lowest median household incomes in the country, OCM spokesman Freeman Klopott told the Times.

The state ultimately plans to issue 150 licenses to individual businesses allocated among various regions of the state. Sixty-three more licenses were slated to be issued in this initial round for the five geographic regions of Brooklyn, Central New York, the Finger Lakes, mid-Hudson or Western New York, but a recent injunction issued by a federal district court on Nov. 10 prevented those further issuances, Syracuse.com reported.

Of these 150 licenses, the state plans to rent properties through the Dormitory Authority of New York, which will then sublet them to the entrepreneurs, along with loans to help the awardees get their storefronts up and running. Twenty-five more licenses, out of a combined total of 175, are reserved for nonprofits.

The licensees must now submit additional information about their finances and business partners before their licenses are finalized, after which they will be allowed to begin deliveries from locations of their choice. This will allow them to “help jumpstart sales and enable these small business owners to generate capital and scale their operations,” the Office of Cannabis Management posted on Twitter.

The Office of Cannabis Management and the Cannabis Control Board also released draft regulations for adult use cannabis. They cover municipal rulemaking, social and economic equity rules, general business requirements, prohibitions and more.

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