In his State of the State address on Monday, New York Gov. Andrew Cuomo (D) said the state “will legalize adult-use recreational cannabis” this session and included the reforms in his Executive Budget for the third consecutive year.
“This will raise revenue and end the over-criminalization of this product that has left so many communities of color over policed and over incarcerated.” – Cuomo, State of the State, Jan. 11, 2021
A 2018 report requested by the governor outlined in the budget found that more than 800,000 people have been arrested for low-level possession in the state, the majority of which are people of color.
“Moreover, the report found that a regulated program would reduce racial disparities in criminalization and incarceration rates,” the budget states.
According to the governor’s budget, cultivators would pay a $1 tax per dry gram of flower, a $0.25 tax per gram of trim, and a $0.14 tax per gram of “wet” cannabis. Retail sales would be taxed 20% with another 2% tax “collected in trust for and on account of the county or a city with a population of a million or more in which the retail dispensary is located.”
The governor’s office estimates legalized cannabis would be worth $300 million in tax revenues for the state once the market is fully mature. In November, Cuomo said he expected the reforms would be approved in the 2021 session “because the state is desperate for funding” due, in part, to the coronavirus response.
The budget also includes funding for the Office of Cannabis Management – which he announced last week – noting that it would require staff from the state’s Division of Alcoholic Beverage Control and Department of Health.
In 2019, the first time Cuomo included legalization in the budget, he faced pushback from law enforcement, teachers’ groups, drug treatment advocates, a physician’s lobby, and downstate Democrats. Instead, lawmakers agreed to expand the state’s decriminalization law and allow expungement of low-level cannabis offenses.
Last session, legalization was pulled from budget talks amid the pandemic as lawmakers shifted their focus to coronavirus-related issues. Lawmakers and Cuomo also had disagreements over how revenues would be disbursed.
In New York, Democrats hold the governorship and both chambers of the legislature.
Get daily cannabis business news updates. Subscribe