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A closer look at NY Gov. Hochul’s proposed budget.
While we previously reported in this newsletter on Gov. Kathy Hochul’s proposedbudget for FY 2025, which she announced last Tuesday, much more information was released by the Division of the Budget late Friday.
Hochul announced last Tuesday that she would propose legislation to increase enforcement and to end the potency tax, you can now read those bills.
The tax proposal is relatively straightforward: replace the potency tax with a 9% wholesale excise tax.
On the enforcement front, the big proposal is to empower localities to shutter shops where unlicensed sales take place. But there are other significant changes, too, that would address barriers to enforcement.
• Language was added to include a “storage facility” as a place where enforcement can take place.
• Language was also added around the unlicensed sale of cannabinoid hemp products.
• As it has been challenging for law enforcement and regulators to determine who owns many of these businesses, language was added to include anyone who qualifies as a “beneficial owner.”
• Language was added to note that certain violations of the law would be considered a “public nuisance.”
• Previously, the language suggested that there could be no “temporary closing order” if a place had “otherwise lawful” activity. Language was added that this only applies if “the unlicensed activity is merely a de minimis part of the business.”
Of course, unlicensed cannabis sellers have proven time and again, in New York and elsewhere, that they can get quite creative with interpretations of the law. So it remains to be seen what new loopholes may emerge.
Hochul also released a more detailed “financial plan,” and here are some highlights:
• Adult use license and application fees: the budget estimates $38 million.
• Adult use THC-based and retail excise taxes: the budget estimates $32 million “during the firstfull year of receipts.” Some of the “net positive impact” will be used to fund localities.
• Adult-use cannabis taxes are estimated to bring in $158 million during the “second fullyear of receipts.”
• School aid is coming from places like commercial and mobile gaming, lottery, and cannabis.
• Medical cannabis is still taxed, and the revenue collected is expected to “moderately decline, in large part due to an overall decline in registered patients.”
NASDA’s Farm Bill priorities include hemp changes.
The National Association of State Departments of Agriculture announced its 2024 “federal policy focus” on Monday, and, unsurprisingly, the new Farm Bill is in the top five.
More specifically, about the Farm Bill, NASDA has ten priorities. Among them is hemp.
NASDA “recommends amending the federal definition of hemp to increase the total THC concentration to one percent or less. Increasing the THC concentration to one percent would enable farmers to plant more seed varieties. This action also retains limits on THC concentration while giving farmers greater assurance their crop will be viable.”
+ More: This isn’t the first time NASDA has made such a recommendation. Back in 2021, Cannabis Wire reported on the group’s vote in favor of this policy position.
CANNRA’s international membership grows.
The Cannabis Regulators Association announced on Monday that the Netherlands has joined as a non-voting member. Last year, Canada did the same.
“As the cannabis, cannabinoid, and hemp industries grow and evolve, it is important that regulators around the globe can learn from each other and better understand how different policy approaches may impact market dynamics, public health and consumer safety, and equity,” said Gillian Schauer, CANNRA’s executive director, in the announcement.
CANNRA also named two new board members who will replace the two members who left their jobs as cannabis regulators last month: Tyler Klimas, formerly with the Nevada Cannabis Compliance Board, and Chris Tholkes, formerly with the Minnesota Office of Medical Cannabis.
The new members are: Kirsten Davis-Franklin, with the Illinois Cannabis Regulation Oversight Office, and Amy Moore, with the Missouri Department of Health and Senior Services.
An excerpt from recent editions of the Cannabis Wire Daily newsletter. Read More