Legalization is headed through New York’s complicated budget process again, Gov. Andrew Cuomo announced Tuesday afternoon.
Facing a $6 billion budget shortfall, Cuomo unveiled his 2020 state budget plan, which shows a $175 billion fiscal path for the year for New York State that includes legalization of cannabis sales for New Yorkers 21 and older.
While the budget gives more detail about Cuomo’s legalization plans, which he initially revealed in his State of the State speech weeks ago, Cuomo devoted little time to cannabis during his budget address.
“Legalize adult use cannabis,” Cuomo said during Tuesday’s budget address. “I believe it is best done in the budget, I said that last year. I believe the budget is the opportunity, frankly, to make some tough decisions and work through tough issues that without the budget can often languish. And I suggest that we get it done in the budget.”
Leading up to the April budget deadline, New York lawmakers are expected to negotiate over spending and other major proposals. It was during this phase that legalization-by-budget failed last year. (A subsequent legislative push also failed.) It remains unclear whether cannabis legalization stands a better chance in 2020, with a year’s hindsight and after months of lawmakers debating over issues like equity provisions and law enforcement.
“These efforts will be done in coordination with neighboring states Connecticut, New Jersey and Pennsylvania,” Cuomo’s office said in a statement, referencing the “regional approach” that Cuomo has been pushing on cannabis policies.
Last October, Cuomo hosted the Regional Cannabis Regulation and Vaping Summit, which brought together governors, lawmakers, and regulators from New York, Connecticut, New Jersey, Pennsylvania, Rhode Island, Massachusetts, and Colorado in midtown Manhattan to debate cannabis policies, from legalization to vaping.
Here are some specifics about Cuomo’s 2020 legalization plans:
On revenue, Cuomo’s office is predicting that legalization could bring in $20 million for fiscal year 2021, and $63 million in 2022. During Cuomo’s State of the State, Cuomo estimated that legalization could generate roughly $300 million in tax revenue “when fully implemented.”
Cuomo is proposing the creation of the Office of Cannabis Management, which would oversee the adult use, medical, and hemp programs. Or, as Cuomo called in in the budget briefing book, a “first-in nation comprehensive cannabis regulatory framework” that “centralizes” licensing, enforcement, and economic development in one office. (Read Cannabis Wire’s interview with Norman Birenbaum, the first head of the new Office.) The budget recommends “workforce increases” in the Division of Alcoholic Beverage Control to “support” the new Office.
“The proposal will administer social equity licensing opportunities, develop an egalitarian adult-use market structure and facilitate market entry through access to capital, technical assistance and incubation of equity entrepreneurs,” Cuomo’s office said in a statement, adding that Cuomo’s plan will “correct past harms to individuals and communities that have disproportionally been impacted by prohibition.”
The proposal aims to tackle public health concerns through “stringent quality and safety controls including oversight over the packaging, labeling, advertising and testing of all cannabis products.”Cuomo’s legalization plan would allow adults aged 21 and older to purchase cannabis products, the same age in every other legal adult use state.
On taxes, Cuomo is proposing three taxes: on cultivation, $1 per dry gram of cannabis flower; $0.25 per dry gram of cannabis trim; and $0.14 per gram of “wet cannabis.” Cannabis sales to a retail shop would be taxed at “20 percent of the invoice price.” (It’s worth noting, too, that “the same sale by any entity to a retail dispensary is taxed at a rate of two percent of the invoice price but collected in trust for and on account of the county or a city with a population of a million or more in which the retail dispensary is located.”)
Cuomo is also proposing the creation of the Global Cannabis and Hemp Center for Science, Research and Education with the State University of New York. When Cuomo announced his State of the State address, that briefing book laid out specifics about the Center.
“The federal government failed Americans with opioids, and we cannot allow that to happen with cannabinoids,” he said in the briefing book. “Until now, the cannabinoid industry has gone unregulated and unchecked, and there is a dearth of independent research on the science, the safety risks, and the dangers/benefits associated with its potential use.”
In the beginning, the SUNY Center will focus on three areas: toxicity, bioavailability, and dosing mechanisms. “This emphasis will determine what is safe, what is effective, and what parameters define healthy and safe dosing. It will also reveal how these substances interact with prescription drugs,” Cuomo said in the briefing book.
State regulators also plan to subsequently establish an open source database for drug interactions, “accessible to anyone considering the use of cannabinoids.”
Cuomo’s budget also proposes the “continued expansion” of the state’s medical cannabis program to “expand patient access and product affordability.”