New York state officials finalized an agreement on Thursday to legalize recreational marijuana in the state, paving the way for a potential $ 4.2 billion industry that could create tens of thousands of jobs and become one of the largest markets from the country.
After several failed attempts, lawmakers in Albany reached an agreement with Governor Andrew M. Cuomo to legalize cannabis for adults 21 and older, a move that authorities hope will help end years of racially disproportionate policing they have seen blacks and Hispanics arrested level marijuana charges much more frequently than whites.
The deal would allow delivery of the drug and would allow salons similar to those in clubs or “drinking places” where marijuana, but not alcohol, could be consumed, according to details obtained by The New York Times. It would also allow a person to grow up to six feet of marijuana at home, inside or outside the home, for personal use.
If approved, the first sales of legal marijuana are likely to take place in more than a year: authorities must first face the difficult task of drafting the complex rules that will control a highly regulated market, from the regulation of wholesalers and dispensaries to the distribution of the crop and retail licenses, for creating new taxes, and a five-member control board that would oversee the industry.
The deal was made with an intense focus on making reparations to communities affected by the decades-long war on drugs. Millions of dollars in tax revenue from cannabis sales would be reinvested in minority communities each year, and a considerable portion of business licenses would be reserved for minority business owners.
“A percentage of the revenue raised will be invested in the communities where people who have suffered mass incarceration come from and still live,” said Representative Crystal D. Peoples-Stokes, a Democrat who led the legalization effort in the lower house for years. “For me, this is much more than increasing revenue: it is investing in the lives of people who have been harmed.”
The governor’s office had previously estimated that legalizing marijuana could generate about $ 350 million in annual tax revenue once the program was fully implemented, which could take years.
With New York following the example of more than a dozen states in legalizing recreational marijuana, Democratic lawmakers sought to shape their proposal based on best practices in other states, hoping to make the New York program a national model.
The final text of the legislation was still being revised on Thursday, but a bill could be passed by the Democratic-controlled state Legislature next week, according to three people familiar with the talks.
“When this bill is finally voted and signed, New York will be able to say that we have finally broken harmful criminal justice laws that have done nothing but ruin people’s lives,” said state senator Liz Krueger, a Democrat who led the talks at the top. chamber. “Finally, we can say that we will have a cannabis industry that guarantees people who buy the product that they are buying a legitimate product from legitimate companies.”
The pressure of years to legalize recreational marijuana in New York, a proposal that often found its momentum stalled by some thread of political travel, received an unexpected boost from Cuomo’s recent political scandals.
Democrats began the year cautiously optimistic that they would reach an agreement. New Jersey had recently legalized the drug, pressing New York to do the same, and the state was in dire need of new tax revenues after the pandemic decimated state coffers.
For Democratic lawmakers, it was a matter of narrowing the differences between his marijuana bill and the governor’s proposal, which he revealed earlier this year.
But the negotiations were called into question when several women began accusing Cuomo of sexual harassment in late February. The accusations, along with scrutiny about how he handled asylums during the pandemic, engulfed his government in a scandal and left his political future at risk.
It turned out, however, that reaching an agreement to legalize marijuana has become a higher priority for Cuomo, as several lawmakers and lobbyists have assumed that the governor may have wanted to divert attention from his aggravating crises. Marijuana legalization was a headline issue and a popular political measure among voters.
Nearly 60 percent of New York voters are in favor of legalizing recreational marijuana, according to a March Siena College poll. Among black voters, a crucial part of Cuomo’s electoral base, which he has recently appealed to, 71% said they were in favor of legalization.
The marijuana proposal was initially being negotiated as part of the state budget, which expires on April 1, but lawmakers said it would be rushed to be voted as an autonomous piece of legislation.
Cuomo normally exercises enormous influence during budget negotiations, but as his scandals increased and many members of his party began to call for his resignation, the governor’s stature decreased.
Democratic lawmakers suddenly had a new influence. They took the opportunity to press for their demands and negotiate an agreement that more closely mirrored their existing legislation, the Marijuana Regulation and Taxation Act, or MRTA, a proposal announced by a coalition of state activists.
Some veteran lobbyists and lawmakers, long accustomed to Cuomo’s strong-arm negotiation tactics, said they were surprised by the torrent of concessions the governor was willing to make to reach an agreement.
The governor had previously insisted that the executive branch retained most of the control over tax revenue, while lawmakers insisted on allocating a large share of income to communities with high rates of repression against marijuana.
Under the current agreement, lawmakers appeared to have fulfilled their wish: 40% of most tax revenues would be reinvested in communities disproportionately affected by the drug war; 40 percent would be earmarked for public education; and the remaining 20% would go to drug treatment, prevention and education.
Retail marijuana sales would be subject to a 9% state tax and a 4% local tax.
The deal It also includes “Equity programs” that would provide loans, subsidies and incubation programs for small farmers and people from disproportionately affected communities who wish to enter the sector.
One of the goals of the legislation is that half of the program’s business licenses go to so-called action candidates, which may include disabled veterans, minority companies and women and people who have relatives convicted of marijuana.
The proposal would also eliminate penalties for possession of less than three ounces of cannabis and allow automatic elimination of records for people convicted of illegal activities that are no longer criminalized.
The legislation will seek to improve the state’s existing medical marijuana program, which for years has been criticized as too restrictive. This would significantly expand the list of covered medical conditions, as well as allow patients to smoke or spray medical marijuana and receive a 60-day supply of the drug, doubling the current 30-day limit. Medical marijuana companies would also be allowed to enter the recreation market.
Patients could grow medical marijuana at home six months after the bill was enacted. Those interested in growing recreational marijuana at home would have to wait longer: 18 months after the opening of the first adult dispensary, to give the regulated market time to develop.
Members of the State Legislative Assembly team met by the end of Tuesday night and again on Wednesday morning, as they struggled to reach consensus.
Among the final critical points were safety issues related to a potential increase in impaired driving if the drug were legalized and how the state’s traffic and vehicle laws would address these concerns. Many Republicans, who are a minority in the legislature, are opposed to legalization, as are some doctors, law enforcement groups and the association of parents and teachers of the state.
Cuomo, a Democrat in his third term, has long opposed legalization, describing the herb as a “passing drug” just a few years ago. His position evolved in 2018 when neighboring states led similar efforts and he faced a major challenge from Cynthia Nixon, a progressive who made marijuana legalization a mainstay of his campaign.
The momentum accelerated when the Democratic Party regained full control of the State Legislature in 2018 for the first time in a decade and promised to prioritize legalization. But attempts to do so have been repeatedly undone.
In 2019, a deal collapsed after differences over how to spend tax revenue from cannabis sales and distribute commercial licenses. In 2020, the response to the pandemic derailed a renewed legalization effort.
The move to regulate the drug is partly aimed at absorbing the state’s illicit marijuana market, a goal that would largely depend on the convenience and accessibility of legal cannabis products.
The cannabis market in New York is estimated at $ 4.6 billion and is expected to grow to $ 5.8 billion by 2027, according to a recent study commissioned by the New York Medical Cannabis Industry Association. The state could capture and tax $ 1.2 billion of that market by 2023 and $ 4.7 billion by 2027, depending on rules and regulations, the study said.