New York Recreational Cannabis Licensing Types
November 08, 2022
By Eric Altstadter
New York became the 15th U.S. state to pass legislation for recreational adult use on March 31, 2021. And while commercial businesses cannot yet sell cannabis products, the state expects cannabis stores to be able to open by the end of 2022.
To open and operate a recreational cannabis business within New York, a specific state-distributed license is required. These licenses are reviewed and issued by the Office of Cannabis Management (“OCM”), a New York Health and Human Services agency.
Currently, there are three different cannabis licenses available to business owners and entrepreneurs interested in operating in New York State. The OCM is currently developing regulations for how a person or business can apply for and receive a license in the new adult-use cannabis industry. The state has stated that the application process will have a special focus on social and economic equity, with 50% of licenses going to those who have been harmed by the prohibition of cannabis.
Here, we’ll provide a quick overview of the different New York cannabis licenses that were made available. All applicants were charged a non-refundable $2,000 fee at the time of submission.
Adult-Use Conditional Cultivator License
The Adult-Use Cultivator License is available to eligible hemp growers interested in expanding their operations to grow cannabis plants containing more than 0.3% tetrahydrocannabinol (“THC”) for the upcoming recreational market. Eligible applicants are existing hemp growers already authorized under the Department of Agriculture and Markets Industrial Hemp Research Pilot Program.
First available on March 15, 2022, licenses were distributed via an application window, later closing on June 30, 2022. They will be valid for up to two years; all active licenses are set to expire by June 30, 2024.
Adult-Use Conditional Processor License
The Adult-Use Conditional Processor License allows businesses that are already licensed to process cannabinoid hemp products on a commercial level. This license is only available to those who already hold an active cannabinoid hemp processor license that was applied for prior to January 1, 2022. Like the cultivator license, and in accordance with New York State law, all processed products are limited to 0.30% THC concentration.
According to the OCM, there are two types of Adult-Use Conditional Processor Licenses available to businesses: Manufacturing Only, and Extraction and Manufacturing. For Manufacturing Only, licensed businesses are permitted to manufacture adult-use cannabis products and not perform extraction activities, whereas they are authorized to do so with an Extraction and Manufacturing License.
Additionally, this license authorizes businesses to distribute processed products to commercial dispensaries until June 1, 2023. Following that date, conditional processors will be required to apply for a separate distributor license to continue doing so. The application was initially available on June 28, 2022, and then closed on August 31, 2022.
Conditional Adult-Use Retail Dispensary License
Conditional Adult-Use Retail Dispensary (“CAURD”) Licenses are the state’s first avenue for retail dispensaries to legally sell adult-use cannabis products to consumers. Any business type is eligible for the license, including nonprofits. License holders must be U.S. citizens over the age of 21 and have a significant presence in New York State. Qualifying businesses should also have tax documents supporting at least two years of profit generation.
The CAURD License comes with its own set of regulations regarding staffing, marketing and branding, training, operating hours, age restrictions, product inventory and pricing, transactions, consumer education, as well as various other rules. If licensees do not adhere to these rules, they’ll risk their license being suspended or revoked.
CAURD Licenses are valid for two years from the date on which it was granted. The conditional period of the license ends four years after the date it was granted. The initial public application window for CAURD Licenses opened for 30 days, from August 25 through September 26.
For more information on New York’s Cannabis licenses and the application process, visit the OCM’s website.