Reuben McDaniel, CEO of the Dormitory Authority of the State of New York, unexpectedly resigned from the Cannabis Control Board during an emotion-fueled meeting on Thursday.
The move, which came after a tearful public comment period, was not listed on the agenda and neither McDaniel nor Board members offered any explanation for why McDaniel resigned. The Office of Cannabis Management (OCM) declined to comment.
“DASNY and I remain committed to supporting the work of the Board and the Office of Management, to create an opportunity for individuals impacted by the unfair enforcement of cannabis laws,” McDaniel said.
A spokesperson for Gov. Kathy Hochul told Cannabis Wire just after the announcement that Hochul is “grateful” for McDaniel’s service on the Cannabis Control Board and added that the governor’s office is now “reviewing candidates for the upcoming vacancy on the Board.”
Beyond that, several questions loomed large at the meeting. What’s specifically being done to lift up the conditional retail and cultivation licensees? What about ensuring the headstart promised to these license holders? That time is quickly dwindling, especially with the sooner-than-expected impending entry of existing medical cannabis operators to serve adults.
The tone during the public comment period was that of anxiety and desperation among growers for outlets to which to sell the cannabis they’ve grown. The tone among the Board reflected disagreement and confusion.
Toward the end of the meeting, as concerns mounted, Board Chair Tremaine Wright alluded to a potential “overhaul” to regulators’ approach.
Assembly Majority Leader Crystal Peoples-Stokes joined and spoke during the meeting to urge patience and support, and focused listeners on the long game.
“Somebody has to be deep in the weeds, figuring out how to make the sausage taste good. At the end of the day, that’s what you all are doing. And I will remind people that if you look at any state that legalized adult use – or even any country, in fact, that legalized adult use – none of them were up and going in two years. None of them,” People-Stokes said, adding that she knows that major multistate operators could have had the industry up and running in “two days.” These businesses, she said, have been in her office in Buffalo and Albany.
“We decided to take a method that was going to invest in the people who had the most impact from the war on drugs. That’s a challenge,” Peoples-Stokes said. “I’m just going to ask people to be patient.”
The Board approved another 36 Conditional Adult-Use Retail Dispensary (CAURD) licenses, bringing the total number of retail licenses awarded to 251, including the first in the Finger Lakes region.
Executive Director Chris Alexander was not present for the meeting because his daughter was graduating from kindergarten. Damian Fagon, OCM’s chief equity officer, gave the executive director’s report in his place.
Fagon also gave an update on enforcement efforts, which in coordination with the Department of Taxation and Finance, included “raids” at 11 unlicensed cannabis shops last week. On Thursday, Hochul’s office announced more enforcement actions in Binghamton and Ithaca this week.
Board member Jessica Garcia jumped in to acknowledge the “number of CAURD applicants” that have approached the Board to “express their their frustration with different elements of the program” and she asked the Board what OCM has been doing to “help CAURD applicants as they’re trying to get their retail dispensaries up and running.”
Board member Jennifer Gilbert Jenkins chimed in to ask about cultivators.
“I wondered if the team can also talk about what we’re doing for cultivators, because I know at the last meeting, honestly, that was just heartbreaking comments from the farmers upstate. And I did want to just ask if there is anything that we’re thinking about to support their efforts to unload all the product that they have been so carefully tending and producing for the market,” she asked.
Another Board member said that she thought the Board planned to consider a proposal that would address the issue, but it was scrapped from the agenda at the “last-minute.”
“So, I mean, the office, internally, we’re still fleshing out some of the details of how we can facilitate this, you know, a new program offloading some of the products. I can’t speak to the details right now because they are still being worked out,” Fagon said.
Several public commenters said they supported anything that would help them place their product, some of which has been warehoused in freezers during the waiting game.
“I love the idea of us leaning into fast pacing a transition into micro licensing because I think one of the gaps that came up for me was that the cultivators were still carrying the burden of holding product in some of the models that have been floated. It did not actually offload the product and put it into the retail side,” Board chair Wright said.
Wright added that regulators, “really should be exploring what it looks like to give them the opportunity to transition into micro if that’s what they want. And also I think we have to be very concerned about what pricing looks like.”
A solution could come as early as next week, Fagon said.
“Our proposals are, you know, they’re in the final stages. I think within, maybe next week, end of next week, we could have something to the Board,” Fagon said. When asked if the Board would consider a special meeting to address the issue, Wright said “definitely.”
“It’s not just one proposal that’s floating, but as has been identified, there are a number of legal concerns. The way our law is structured. And so we may need to come up with applications and doing some things a little bit differently that we had not been thinking about,” Wright said. “But I think that we can come up with a solution.”
Even more changes, perhaps major ones, could be coming to New York’s cannabis market, Wright foreshadowed.
“It also might mean that we need to shift and rethink about how the rest of the market is set up. Because I do think, as we are realizing how long it takes for someone to get a license and actually open a retail space, how do we fast pace some of them so that they know that they’ll be ready for the crop that’s currently being grown now? How do we have them prepared so they can receive it this fall?” Wright asked. “So, I think there’s an overhaul for all of us to begin thinking about.”
OCM’s legal counsel, who didn’t name herself before speaking, tried to pull back those statements, adding: “I would love to be able to say that we’re going to be able to resolve this within a week. And I know that there’s huge expectations. But at this time, that would be difficult for us to say that,” she said. “We’re still grappling with a number of issues.”
Jeff Jones, a conditional adult use cultivator license holder based in the Finger Lakes, spoke during the public comment period.
“I believe in the awesome power of cannabis to unfuck the world, to make meaningful contributions to some of the most intractable issues of our time,” Jones said, adding that he was initially heartened by New York’s justice-first approach to cannabis legalization.
“Unless sincere, sustained effort follows these good intentions, they rot. And real change never takes hold. It is word and deed that is important. And so I am profoundly disappointed in the current direction and deeds of the state of New York,” Jones said. “Collectively, these agencies are not moving fast enough to create a viable marketplace for small businesses.”
Jones said that there was a “suicide prevention professional” on their recent cultivator call.
“You are not on your way to creating generational wealth. You are on your way to creating generational debt and despair,” Jones said.