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November 18, 2022

Office of Cannabis Management Preview of NYS Adult-Use Cannabis Regulations

It is expected that the New York Office of Cannabis Management (OCM) will be releasing regulations at the Cannabis Control Board (CCB) meeting on Monday, November 21.

In a preview to the regulations, a lot of previously unknown information was disclosed, giving conditional licensees and future licensees the information they need to plan.

For cultivation licenses, the OCM intends to create five tiers of licenses that are differentiated by light source. The allotted square footage per license will range from 5,000 to 100,000 square feet. The regulations will incentivize sustainable cultivation practices and limited energy utilization, including outdoor cultivation.

Nursey license holders will be allowed to sell immature cannabis plants and seeds to other adult-use cannabis licensees but not directly to consumers.

The adult-use processing regulations will create three types of processing licenses: 

  1. Minimal processing, consisting of branding, packaging, and labeling 
  2. Blending and infusing, which will require a good manufacturing practices (GMP) facility 
  3. Extraction, which must have a GMP facility

The cannabis collective (co-op) license will allow for either a cooperative association or traditional cooperative model so the entities can receive investments. The regulations will allow co-op licensees to scale up operations in proportion to how many members join. A co-op license will require a minimum of five members.

The distribution license will allow cultivation and processing licensees to distribute their own product. Additionally, those who obtain only a distribution license will be allowed to distribute on behalf of any supply tier licensee.

The retail dispensary regulations will provide specifics as to the design of dispensary operations, which will include all security and staffing requirements. The regulations will also provide dispensary operators with the path to authorization for delivery as well as on-site consumption in approved locations.

Perhaps most exciting, as this was one of the biggest unknowns, are the details regarding microbusiness licenses. Microbusinesses will be allowed to cultivate 3,500 square feet of flowering canopy indoors or 10,000 square feet outdoors. Microbusinesses will be able to have retail locations that are distinct from their cultivation and processing facilities.

If you have any questions regarding the content of this alert, please contact Jason Klimek, Cannabis Team co-leader, at jklimek@barclaydamon.com, or another member of the firm’s Cannabis Team.
 

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