Hochul calls for a crackdown on cannabis to gain ‘some teeth’

Gov. Kathy Hochul visited New York City on Wednesday to drum up support for her latest proposals to close unlicensed marijuana shops, which have exploded in number in the wake of the legalization of recreational cannabis.

In Manhattan alone, there are more than 400 illegal pot shops – more than the Starbucks stores in the borough and far more than the several dozen licensed cannabis stores in the entire state.

At a news conference at the governor’s office in Midtown Manhattan, attended by several owners of licensed pharmacies, Ms. Hochul sought to allay concerns about a return to the heavy-handed enforcement tactics of the war on drugs, while pushing for measures that she said would provide “some teeth” to the so far ineffective efforts to eradicate the unlicensed shops.

Her action came as state lawmakers considered her proposal to strengthen the hand of local agencies by giving them the power to open padlock shops. She was joined by licensed pharmacy owners who said the legal market could not compete with the low prices in illegal stores. The governor and business owners also called on search engines and social media companies like Google and Yelp to remove content about unlicensed stores, which they said adds to confusion among consumers about which pot shops were licensed and which were not.

The governor said the illegal stores posed a public health risk and undermined the state’s efforts to build a cannabis industry that could provide opportunities to people harmed by the war on drugs. She said efforts to deter the stores over the past year with raids and fines had been concentrated in the hands of too few agencies and had been ineffective. Her proposal would make it easier for the state Office of Cannabis Management to obtain court orders for padlock shops and allow the orders to be enforced by local agencies with more staff.

“More and more money is flowing into them and not into our legitimate operators – and that’s what needs to change,” she said.

New York legalized cannabis in 2021, prompting a rush of people trying to raise money before regulators could set the rules and hand out licenses. Despite hundreds of raids over the past year, smoke shops dot the city’s streets, brazenly selling cannabis to consumers who are often underage or unaware that the shops are unlicensed.

Last year, the Legislature gave state cannabis regulators and tax authorities more power to go after unlicensed sellers. The city and the Manhattan District Attorney’s Office also sent warning letters to the landlords of more than 400 stores, but only 15 of the stores have been evacuated, according to Mayor Eric Adams’ office.

Overall, few stores have been penalized or closed. The Office of Cannabis Management said it had imposed $25 million in fines, but the agency has collected only $22,500 as retailers fought the fines in administrative hearings that have lasted for months, a development that first reported by the city.

Licensed Retailers called for the state to take action against social media companies and search engines they accuse of driving unsuspecting consumers to unlicensed stores. Those same sites, the retailers say, removed ads belonging to licensed pharmacies without explanation.

The New York Times searched for dozens of unlicensed stores that had received warning letters from the city and the Manhattan district attorney and found that many of them had active listings on Google and Yelp. Some had over a thousand reviews, along with links to their websites and Instagram accounts.

During the press conference, the governor held up a cell phone with a list of nearby stores and said, “This is what we need to stop.”

Osbert Orduña, the president of Cannabis Place, a dispensary with locations in Jersey City and Queens, said the Queens store had been removed from Google Maps four times even though he had provided documents to the company showing it was a legal store. store.

But in statements to The Times, social media companies would not commit to removing the listings and said they would not allow cannabis companies to post ads. Google said it would display a message indicating a business had closed, but also said it would investigate the issues businesses had reported regarding their listings. Yelp claimed that consumers had a First Amendment right to information about all businesses, even unlicensed ones.

“Allowing users to contribute and view information (including complaints) about unlicensed businesses serves the public interest and provides regulators with a tool to determine whether a particular business is properly licensed,” the company said.

Mr. Adams said that he supports the governor’s proposals, but he added that lawmakers should give police and the sheriff’s office the authority to inspect unlicensed smoke shops. Currently, authorities can only inspect a shop suspected of illegally selling cannabis if it has a tobacco license.

The Manhattan district attorney’s office said it was also seeking a change to the state’s property law that would allow prosecutors to seek the eviction of unlicensed stores that “habitually or habitually” sell cannabis. Current law only allows them to clear stores that “exclusively or mainly” sell illegal cannabis, a spokesperson said.

Mr. Adams will attend Thursday’s opening of Matawana, a licensed dispensary in Brooklyn, one of only 77 legal outlets in the state. It is one of more than 50 that have opened since an order halting the rollout was lifted in December.

The owner, Leeann Mata, said she spent more than $100,000 of her own money to open the pharmacy after the state failed to deliver on its promise to provide the first 150 retailers with built-out stores and low-interest loans. Some of the money was intended to pay for her son’s tuition at Hofstra University, but they agreed he would start at a community college and then transfer to Hofstra once her pharmacy was up and running. But an order halted the rollout last fall and left her unable to fulfill her promise, she said through tears.

She said unlicensed stores abounded near her pharmacy in Park Slope.

“They just made my job more difficult than it needs to be,” she said. “And I put everything into this.”