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Overview
The adult-use dispensary license is required to open and operate a legal cannabis dispensary in New York. The Office of Cannabis Management (OCM) is responsible for managing the application process and awarding licenses as they see fit. Frequently visiting the OCM website and staying up to date with any regulatory changes is very important when planning to open an adult-use dispensary in New York. Due to past inconsistencies regarding OCM rules and regulations, working with CannDelta is the best way to guarantee you’re on the right path to licensure.
The first dispensaries that opened in New York were the result of the Conditional Adult-Use Retail Dispensary (CAURD) program. The CAURD license program has since been cancelled for new applicants, but all of the past applicants will still have their applications reviewed and be awarded conditional licenses. All current and future adult-use dispensary applications will be non-conditional. All conditional license holders must transition to non-conditional licenses within four years from the date the license was issued.
What does New York’s Adult-Use Dispensary License Allow?
An adult-use dispensary license permits the holder to acquire cannabis products from another licensee that is authorized to distribute cannabis products. The dispensary license holder may then possess, sell, and deliver cannabis products to cannabis consumers that are 21 years-of-age or older. Owning and operating a dispensary requires an adult-use dispensary license.
Additional Dispensary License Authorized Activities
- A retail dispensary is allowed to obtain seedlings and immature plants from any licensee authorized as a nursery.
- Retail dispensaries can also operate as limited retail consumption facilities.
- Adult-use dispensary true parties of interest (TPI) can also be TPIs in a delivery license, one other adult-use dispensary license, and on-site consumption licenses provided they adhere to all regulations regarding such affiliations, including restrictions on undue influence, control, and TPI criteria.
- Dispensaries are authorized to operate a drive-thru service and pre-order pickup lanes with approval from the OCM.
- A retail marijuana dispensary is permitted to showcase samples of each cannabis product available for sale within secure, locked cases.
Operational Requirements
Operating a business under an adult-use dispensary license that will be selling cannabis products, either in-person or online, must comply with all regulations set by the OCM. Note that the following information is comprised of some key requirements but is not entirely exhaustive of every detail. Partnering with regulatory professionals at CannDelta is the optimal approach to guarantee compliance with your adult-use dispensary application and operation. Key adult-use dispensary operational requirements are as follows:
- A physical building (approved by the OCM) that includes visible posted hours of operation is required.
- The recreational dispensary can only operate and make sales during the posted times of operation. The times of operation must be provided during the license application or in the retail dispensary operating plan. Hours of operation must also adhere to the rules distinguished by the municipality in which the dispensary is operating.
- Valid identification must be provided by customers to validate that they are 21-years-of-age or older for all in-person transactions. Customers ordering online or over the phone must attest to being 21 years-of-age or older, and they must provide valid identification at the point of sale, either in-store or at the time of delivery.
- Must be able to provide secure storage containers that can lock and are child resistant.
- Must use an inventory tracking system.
- Adult-use retail dispensaries must have educational materials available to cannabis consumers during in-store purchases and deliveries. Educational materials may be provided and/or required by the OCM. Any educational material must not make health claims about cannabis or cannabis products.
- Adult-use licensed dispensaries must display the Dispensary Verification Tool (shown on the right) near their main entrance.
Restrictions & Limitations
- Cannabis products must be sold by individuals authorized to sell cannabis products. All dispensary employees must be registered and 18 years-of-age or older. Any employee interacting with consumers or selling cannabis products must be 21 years-of-age or older.
- Employees of the dispensary are not permitted to oversee multiple dispensaries at the same time.
- Employees cannot be forced to enter a limited retail consumption facility to properly do their job if the employee does not agree to do so.
- An individual cannot be considered a TPI in more than three adult-use retail dispensary licenses, or in both an adult-use retail dispensary and delivery or on-site consumption license.
- There cannot be any processing, manufacturing, or compounding taking place at dispensaries.
- Cannabis products cannot be sold to, delivered to, or given to anyone 21-years-of-age or younger, or anyone that is noticeably intoxicated.
- Cannot obtain or document personal information of cannabis consumers without their consent, except when such information is typically collected during a sales transaction, such as verifying the consumer’s age.
· Can only sell cannabis products from New York licensed brands.
Record Keeping & Reporting
Adult-use dispensaries must use an inventory tracking system that is capable of compiling product inventory, transaction data, and tax obligations as specified by the OCM. The system must be compatible so that it can report data to the OCM in real-time.
Additionally, it must conduct a monthly analysis of the inventory tracking system to verify that no software has been installed to manipulate or alter inventory or sales data, and that no other methods have been used to manipulate or alter data.
The system needs to restrict intentional underreporting or overreporting of sales or manipulation of inventory.
Packaging
A recreational dispensary can only sell products that meet specific, compliant packaging and labeling guidelines as determined by the OCM. Dispensaries can sell products that adhere to the following:
Cannabis Packaging Must:
- There needs to be a physical package for the cannabis product.
- Be child-resistant, tamper-evident, and fully enclose the cannabis product.
- Must be sealed so that the cannabis item is not damaged while being stored.
- Must not expose the cannabis item to any toxic or harmful substances.
- Must be resealable if there are multiple servings.
- Must be labeled with all appropriate and required information including total THC, CBD, number of servings, etc.
- Must contain New York’s universal symbol(s) for cannabis products.
Cannabis Packaging Must Not:
- Cannot be attractive to anyone under the age of 21.
- Cannot be scented or make sound.
- No appearance altering technology such as holographic features.
- Numerous other restrictions exist and are enforced by the OCM.
Dispensary Locations
Legal Adult Use Cannabis Dispensaries in New York as of February 2024
Adult-use cannabis dispensaries must follow location guidelines that are dictated by the OCM and their municipality. An adult-use dispensary license application requires the provision of a suitable site that meets all regulatory guidelines. The best way to guarantee your location is suitable for operating a marijuana dispensary is to work with regulatory consultants at CannDelta. Location requirements can be difficult to understand and finding a suitable site can be a challenge. Some of the general laws in place that cannot be altered by municipalities include the restriction of adult-use dispensaries.
- On the same road and within 200 feet of a house of worship’s entrance.
- On the same road and within 500 feet of a school’s entrance.
- On the same road, or within 500 feet of a public youth facility or its grounds.
Cannabis Product Storage
There must be secure, lockable storage that will mitigate theft, loss of cannabis products, physical, chemical, or microbial alterations. Storage areas must be approved by the OCM. Keys accessing storage capsules must not remain in the locking mechanism or in an easily accessible area. Any other form of lock access like combination passwords, etc. must be available to only those that are authorized to access the storage area.
There are numerous other security measures that need to be accounted for when submitting an adult-use dispensary license application, and during the operation of a marijuana dispensary. Contact CannDelta for compliant security plans required for an adult-use dispensary license.
General Application & Eligibility Requirements
All New York cannabis license applications must be done online through the New York government. The applicant(s) must submit a variety of detailed information including business formation documents, operational plans, security plans, and much more. Other general application requirements are as follows:
- All license holders must be 21 years of age or older.
- Applicants must not be disqualified from holding a license under the Cannabis Law or regulations due to prior non-cannabis related convictions as specified in Section 137 of New York State cannabis adult-use regulations or True Parties of Interest (TPI) prohibitions.
- You must not have any disqualifying criminal convictions, including:
- Any business-related felony conviction within the last five years, such as fraud, money laundering, forgery, and similar offenses.
- Any felony conviction within the past 5 years involving controlled substances and minors. This includes activities such as hiring, employing, or using a minor to transport, carry, sell, give away, prepare for sale, or peddle any controlled substances to a minor. Additionally, it involves selling, offering to sell, furnishing, offering to furnish, administering, or giving any controlled substance to a minor.
Expenses and SEE Reductions
Qualified social economic and equity (SEE) applicants may qualify for a 50% reduction, waiver, differed fee, or supplemental reduction in licensing fees.
Those that did not qualify as SEE applicants must pay the standard $1,000 application fee, followed by a $7,000 license fee upon approval.
Why Partner with CannDelta?
CannDelta is New York’s #1 cannabis consulting firm, known for its successful navigation of New York’s complicated regulatory framework. We help clients get past obstacles keeping them from starting a successful cannabis business. Our services include comprehensive application support, strategic site selection, CAURD license support, competitive strategies, and more.
As New York’s cannabis sector rapidly evolves, CannDelta offers invaluable expertise and guidance for entrepreneurs and established businesses to thrive in this dynamic market.
Explore the advantages of starting a cannabis business in New York by contacting us today at our New York office hotline at: +1 646-440-4202
Frequently Asked Questions
What is a True Party of Interest (TPI)
The primary individual of the applicant or licensee, including but not limited to: sole proprietor, partner (limited or general), member, manager, president, vice president, secretary, treasurer, officer, board member, trustee, director, or holding an equivalent title to any of the aforementioned.
- Shareholders of the applicant or licensee, excluding individuals owning 5% or less in the aggregate of a publicly traded company.
- Every individual involved in the ownership structure at each level of ownership for an applicant or licensee with a multilevel ownership structure.
- Individuals entitled to receive a portion or all of the revenue, gross profit, or net profit from the licensed entity during any complete or partial calendar or fiscal year.
- Individuals with a financial stake in the applicant or licensee.
- Individuals that are authorized to, or are exercising control over the applicant or licensee.
- Individuals possessing membership rights in the applicant or licensee as per the provisions of any articles of incorporation, bylaws, limited liability corporation agreements, partnership agreements, or operating agreements.
- Individuals assuming liability for the debts of the applicant or licensee.
How much does it cost to get a dispensary license in NY?
All applicants must pay a $1,000 application fee followed by a $7,000 fee upon approval.
What’s the difference between an adult-use and medical cannabis dispensary?
Adult-use dispensaries authorize sale to any adult over the age of 21. Medical dispensaries require the sale be made to a person possessing a valid medical card. Beyond the need for a medical card and slight supply chain differences, all other standards are the same between medical and adult-use dispensaries.
How do you qualify for a dispensary in New York?
As of March 2024, there are no specific requirements for adult-use dispensary licenses beyond the general eligibility requirements. The OCM started the CAURD license program in 2023 to give SEE applicants the first chance to get an adult-use license, or an AUCC/AUCP license. As things stand, there are no specific qualification standards as long as you meet all eligibility requirements, such as no disqualifying criminal offenses and that the applicant is 21 years-of-age or older.
