By: Duncan Delano and Brittany Tovar
Applications for Conditional Adult-Use Retail Dispensary Licenses to Open Next Week
The New York Office of Cannabis Management (“OCM”) announced it will begin accepting applications for Conditional Adult-Use Retail Dispensary (“CAURD”) licenses beginning next Thursday, August 25, 2022. CAURD licensees are scheduled to make the first legal adult-use cannabis sales before the end of 2022.
Atonement for the War on Drugs
Applicants can apply under the qualifying business track or qualifying nonprofit track. The business track requires that one or more owners of at least 51% of the business be (a) “justice involved” and (b) have “qualifying business experience”, and one such owner must hold at least 30% of the company’s equity and exercise sole control over the company.
- “Justice Involved” means that the person or one of the person’s parents/guardians or children/dependents was convicted of a marijuana offense in New York prior to March 31, 2021.
- “Qualifying Business Experience” means that the Justice Involved person has owned at least 10% of a business (anywhere, not just New York) that was profitable for at least 2 years.
New York State to Site and Construct Dispensaries
New York’s Cannabis Social Equity Investment Fund (the “Fund”) has been established to position qualifying social equity entrepreneurs to succeed in New York’s adult-use cannabis industry. The Fund is a public-private limited partnership charged with financing and equipping up to 150 CAURDs in New York.
The Fund, operating through the Dormitory Authority of the State of New York (“DASNY”) will help approved CAURD license applicants cover certain initial operating costs, including locating, designing, and constructing retail sites. Financing for the Fund’s will include up to $50 million in licensing fees and revenue from the adult-use cannabis industry and up to $150 million in private sector funds.
Once locations are located and built out, the Fund will then sublease the “turn-key” dispensaries to CAURD licensees. The state intends to locate CAURDs in 14 geographical regions, and CAURD license applicants will be able to select their top 5 regions when applying. As of the end of last week, the state had not yet acquired any sites for the CAURD program (CAURD applicants may not find and acquire their own property).
Earlier this year DASNY chose a minority-led investment team to run the Fund: Social Equity Impact Ventures, LLC (“Impact Ventures”). Impact Ventures is a joint venture partially run by NBA Hall of Famer Chris Webber.
Application Process and Guidance
The CAURD license application will consist of two parts and must be submitted to OCM. Applicants must first submit evidence of eligibility. Once deemed eligible, applicants must then submit a full application. Applications must be submitted by September 26, 2022. If you or someone you know might qualify for these first-to-market cannabis retail licenses, please reach out to us.