Andrew Cuomo, the governor of New York from 2011 until his resignation Aug. 23, never liked marijuana legalization all that much.
It’s true Cuomo signed into law in March the state’s Marijuana Revenue and Taxation Act, which legalized adult-use cannabis in the nation’s biggest city and set the stage for a statewide industry worth as much as $4.6 billion. No serious observers believe Cuomo legalized out of any sense of civic or moral duty.
Instead, the propriety was that everyone else was legalizing, and COVID-19-crushed New York needed the tax money. (Other, more cynical observers would say Cuomo also needed a win, a shiny object to distract himself, voters, and maybe even Attorney General Tish James from his sexual-assault and nursing-home death scandals.)
Even this accomplishment that followed years of false starts and hardball negotiations from the power-brokering, control-freak governor—who wanted to ensure the chief executive enjoyed dominance over the weed industry in New York state. This summer, with entrepreneurs and consumers waiting for a clearer indication as to when legal commercial sales of cannabis in the state could begin, Cuomo appeared to slow down the process out of spite. As a consequence, legal sales in New York might not start until 2023, according to MJBizDaily.
This week, Cuomo’s successor, Gov. Kathy Hochul, promised to make up for Cuomo’s foot-dragging. Hochul vowed to quickly make the necessary appointments and get the state’s cannabis industry moving quickly.
Most cannabis advocates in New York State have no love lost for Cuomo. But all this reveals something about Cuomo, and the cannabis framework Hochul inherited. New York is one of the friendliest landscapes in the country for Big Marijuana, the handful of publicly traded big marijuana companies that dominate the industry in more and more states. And for this, Big Marijuana has Andrew Cuomo to thank.
All of the biggest cannabis companies in the country, for whom Cuomo willingly carried water, often at the expense of medical cannabis patients and would-be entrepreneurs, have existing footholds in New York.
In a twist, unless the start of commercial sales is delayed for years, all of the big marijuana companies will be the first to enter the market, gifting them a golden opportunity to control the market before smaller competitors can even harvest their first plant, according to critics.
And while New York does have strong provisions around so-called “social equity”—the term for government trying to “guarantee” (or at least encourage) at least some of legalization’s business and profit opportunities go to people of color and others hurt by the drug war, rather than rich white capitalists—even these rely on tax money from the big operators.
And these big operators enjoy existing market positions that are commanding… thanks to Cuomo.
Under Cuomo, New York State legalized medical cannabis, but under possibly the strictest rules in the country. More than five years on, fewer than 150,000 patients had qualified to access medical marijuana—and these patients could acquire cannabis from one of only ten companies issued licenses by the state.
These “original ten” cannabis companies, gifted a market near-monopoly by the governor, became attractive takeover targets from Big Weed. And Big Weed snapped them up—in no small part because existing medical marijuana companies will be the first to supply and sell cannabis on the legal adult-use market.
This baked-in imbalance would be less likely to happen had New York legalized medical cannabis more like Oklahoma or California and less like Illinois or Ohio. That was a decision Andrew Cuomo influenced.
“It is really tremendously unfair,” said attorney and cannabis law specialist David Holland, who noted that under Hochul, the state could quickly allow sales. “It just won’t embrace any of the people who are supposed to be restored by legalization,” he added, “because it’s just the big conglomerates taking over.”
“I would love to see New Yorkers [as opposed to out-of-staters] and social equity applicants get first dibs on the market,” said Ryan Lepore, the interim executive directorof Empire State NORML. “But I haven’t seen a way around [Big Marijuana], the way things are set up.”
Hochul doesn’t have to play the game with all of Andrew Cuomo’s rules. The state could expand the number of medical marijuana licensed gifted even further. The state could very quickly legalize existing, illegal marijuana businesses like legacy growers and delivery services. All that would be very unlike Cuomo, who provided an example of how government can best help Big Marijuana take over a state’s cannabis industry.