Becoming an adult-use microbusiness license holder in New York authorizes the cultivation, processing, distribution, retail sale, and delivery of the license holder’s own cannabis products. This means that the microbusiness must cultivate its own cannabis and engage in at least one of the other previously mentioned activities.
What Does New York’s Microbusiness License Allow?
The authorizations granted to microbusiness license holders are based on the requests made and approved during the application process. The following activities account for some key activities that are often permitted to microbusiness license holders.
- Cultivate cannabis within designated canopies, including indoor spaces up to 3,500 ft², mixed light areas up to 5,000 ft², outdoor areas up to 10,000 ft², or a combination of outdoor and mixed light spaces (up to 5,000 ft² outdoors and up to 2,500 ft² mixed light).
- Operate a processing facility for the manufacturing of cannabis products.
- Procure cannabis biomass, or its extract equivalent, up to 500lbs per calendar year from licensed cultivators, microbusinesses, cooperatives, collectives, Registered Organizations with Dispensing (ROD), and Registered Organizations with No Dispensing (ROND).
- Process up to 1,700 pounds of cannabis biomass annually into cannabis products, except for exclusive cultivation by the microbusiness at its licensed premises, which has no processing limit.
- Supply cannabis to licensed processors.
- Retail self-produced cannabis products to licensed distributors.
- Distribute self-manufactured cannabis products to retail dispensaries and on-site consumption locations.
- Provide delivery services for cannabis products produced by the microbusiness to cannabis consumers.
- Sell cannabis products directly to consumers if your license authorizes retail sale.
- Organize cannabis events.
- Directly retail cannabis products to consumers from the microbusiness’ retail premises.
- If a microbusiness has a retail store, they can also an on-site consumption lounge.
Operational Requirements
Microbusinesses must engage in cultivation and one of either processing, distribution, or retail sale.
Any retail location operated by a microbusiness must be located within 25 miles of the cultivation facility if it is in a city of less than one-million people. If the retail business is to be opened in a city of more than one-million people, the cultivation facility must be located in the same region. Exact distance requirements are dependent on whether the cultivation facility is located inside or outside of New York City.
Restrictions & Limitations
Microbusiness license holders cannot purchase cannabis crop from another cultivator unless they face crop failure.
Microbusiness license holders can only participate in cultivation activities and the other activities authorized as a part of your license. Major operational changes will require a new license that addresses the changes.
A true party of interest (TPI) of a microbusiness can passively invest in as many different licenses as they want, but they cannot be a passive investor in a retail license. Investors must follow all relevant regulations regarding undue influence and TPI criteria.
Cannabis Storage
Secure, lockable storage is necessary to prevent theft, loss, or alteration of cannabis products. These storage areas must be approved by the OCM. Keys should not be left in locks or easily accessible areas. Access to storage units, whether through combination passwords or other means, must be restricted to authorized personnel only.
All areas used for cultivation will need to be securely locked and protected to restrict entry unless cannabis is being removed or replaced.
There must be a separate area for the temporary storage of cannabis that needs to be disposed of. This storage area also needs to be secure.
No storage area can be visible to the public.
Numerous other storage rules and regulations are required for microbusiness license holders that depend on the activities authorized in the license. It is important to be familiar with all requirements to ensure your application submission will be successful and to operate within compliance. Disregarding storage requirements can result in various repercussions including facility closures.
Security
All facilities need to have appropriate security to detect and prevent theft and loss of products and equipment. The minimum requirements include:
- Alarm systems monitored internally, and by a third-party central monitoring station.
- Alarm that alerts local safety divisions such as police, fire department, private security departments and others as required by licensed activities.
- Video camera surveillance covering most areas. Cameras must be directed at safes, vaults, sales areas, and all cultivation areas. These includes areas where cannabis is cultivated, harvested, dried, cured, stored, disposed of, handled, transferred, or sold. Cameras must also be directed at entry/exit points. Recordings need to be held on to for a minimum of 60 days and they need to be available to the OCM for inspection upon request. There are numerous other requirements for video surveillance that will need to be submitted as a feature of the microbusiness license application and security report.
- There must be a fence that surrounds the perimeter of site, or a breach protection device tha has been approved by the OCM.
- Inclusion of floodlights that are motion activated.
- All visitor and employee logs of entry/exit to the facility with various details.
- More specific security details will be required for microbusiness licensees.
Recordkeeping & Reporting
Microbusiness recordkeeping and reporting requirements are determined by the licensed activities. All records need to be available to the OCM upon request.
- There must be detailed records of architectural diagrams and floor plans.
- Financial records including TPIs, bank statements, sales invoices, receipts and all other records that will be required for tax purposes.
- Employee records.
- Standard operating procedures (SOP).
- Equipment used in cultivation.
- Upkeep and maintenance records.
- More specific details about these recordkeeping and reporting requirements exist and are determined by the activities and authorizations of the license. Work with cannabis regulatory experts to ensure you’re avoiding any possible civil penalties or license revocation.
General Application & Eligibility Requirements
All the activities the microbusiness license holder plans to take part in must be disclosed and approved by the OCM as a part of the microbusiness application process.
The license tier is determined by the size of the cultivation canopy and type of cultivation the applicant wants to engage in. In general, an indoor canopy cannot be greater than 3,500 ft², a mixed light canopy cannot be greater than 5,000 ft², an outdoor canopy cannot be greater than 10,000 ft², and combination canopies cannot be larger than 5,000 ft² (outdoor) and 2,500 ft² (mixed light). If a microbusiness license holder wants to expand their canopy size, they must convert to a cultivation license.
The applicant must indicate what processing activities (if any) they plan to engage in. These include extraction, blending, infusing, packaging, labeling, and branding
All applications for New York cannabis licenses must be completed online through the New York government portal. Applicants are required to submit detailed information, including business formation documents, operational plans, security plans, and more. Additionally, applicants must meet the following general requirements:
- All license holders must be at least 21 years old.
- Applicants must not be disqualified from holding a license under the Cannabis Law or regulations, as outlined in Section 137 of the New York State cannabis adult-use regulations, or True Parties of Interest (TPI) prohibitions.
- Applicants should not have any disqualifying criminal convictions, including:
- Business-related felony convictions within the past five years, such as fraud, money laundering, forgery, and similar offenses.
- Felony convictions within the past five years related to controlled substances and minors, which include activities such as employing minors in drug-related activities or providing controlled substances to minors.
Expenses
Microbusiness application fees vary depending on the area and type of cultivation canopy that’s used. Cultivation license fees are different. The standard $1,000 applies to all New York cannabis license applications upon the time of submission. The applicable microbusiness license fee will follow if the license is awarded to the applicant:
Why Partner With CannDelta?
At CannDelta, our team of cannabis consultants in New York assists entrepreneurs in navigating the intricate process of establishing a cannabis business. We accomplish this by maintaining comprehensive knowledge of the New York licensing process, municipalities, and regulatory commissions.
CannDelta has successfully launched numerous cannabis businesses in New York, spanning retail dispensaries, cultivation license facilities, testing and research facilities, and more. Here’s why our expertise is essential for your business’s success:
- Proven Track Record: With a history of driving success for cannabis businesses, the CannDelta’s cannabis consultants offer premier cannabis consulting in New York, providing unparalleled industry-specific knowledge and practical experience.
- Cost and Time Efficiency: Our services help clients save significant amounts of money and time by guiding them around common pitfalls that could result in unnecessary expenses and delays.
- Expertise in Regulatory Navigation: Navigating complex regulations can be daunting, but our team excels in steering businesses through these complexities, ensuring compliance and operational smoothness.
- Customized Business Strategies: We provide tailored solutions to align with the unique needs and circumstances of each client, ensuring the best possible outcomes.
- Risk Management: With ongoing support, we help identify and mitigate potential risks to secure the long-term prosperity of your cannabis cultivation business.
Frequently Asked Questions
What is a Cannabis Microbusiness in New York?
A Microbusiness is a type of cannabis license in New York. This license authorizes the cultivation, processing, distribution, retail sale, and delivery of the license holder’s own cannabis products. This means that the microbusiness must cultivate its own cannabis and engage in at least one of the other previously mentioned activities.
How Do I Apply for a Cannabis Microbusiness License in New York
Applying for a microbusiness license in New York will require an application submission to the OCM. You must submit a variety of documents along with your application. These documents include business certifications, financial information, operational plans, and many others.
How do I start a cannabis business in New York?
Starting a cannabis business in New York requires a cannabis license. The type of license will determine the cannabis business you can start. For example, if you want to start an adult-use dispensary business, you would need an Adult-use Dispensary license.
