Felicia Reid was appointed interim executive director of New York’s Office of Cannabis Management in a turbulent period. State Office of General Services released an scathing report and Governor. Kathy Hochul called the recreational marijuana market in Washington a disaster.
Now, a year later and just past the fourth anniversary of the 2021 state law which legalized adult-use cannabis, Reid believes things in the New York cannabis market have turned a corner for the better.
The interview with Green Market ReportReid expressed an optimism about the future of the marijuana market, while also highlighting the real dangers that the illicit trade poses.
The interview was edited to make it shorter and more concise.
You came on during a tumultuous time. Do you still feel the same about how things are going in the industry almost one year on?
Reid: I can’t believe how fast the year went. It’s hard to believe what’s occurred, particularly in this environment. Criticisms were made of both the process and practice employed by the agency. The Office of General Services looked into how the agency operated.
Not only with the OCM but also with the stakeholders was a priority. This plant means so much to many people. This is something I constantly hear. Even in my personal life, I’ve heard it.
The title I have is not enough for me. I also do not want to just be a person who has a job and does not perform the tasks that go with it. In my case, I was showing that both internal and externally I really wanted to be present to support this work. It was important to me to create the necessary connections for the agency to be able to stay afloat, since it had a very chaotic path.
Many CAURD licensees are having serious difficulties opening. The most frequent complaint I have heard was a lack access to capital. CAURD permits will expire in June. What do you think?
Reid: It’s 100% correct. The issue there is – and in this business writ large – is access to capital. Many people see the dollar signs in the cannabis industry, and they want to get a share of it. This is especially true for those who have suffered from the government’s approach towards the drug. The structures for financing are not there to help people who have the business sense.
We just launched our CAURD Grant, which will allow any CAURD Licensee to request up to $30,000. This grant can be used to cover any operational expense. Send us all your receipts. These grant funds are available if you can show that we have done something to support your business.
It’s just a start.
The federal government’s attitude towards cannabis needs to change. However, I don’t think the federal government will help us. Our state has to be deliberate in creating programs to help our licensees. The Cannabis Hub Incubator Program Academy is one of those resources.
As an agency, we have a lot of work to do in order to address the stigma, and this is where some of our licensees get hung up. As an agency, we have much work to do in order to combat the stigma. This is where many of our licensees get hung up.
Will you support a new extension of the CAURDs?
Reid: The first licenses were extended in November, and we will have to observe what happens on the ground to answer a subsequent question. Since I am a very fact-based person, I do not want to make any commitments. As we consider a new policy, or the extension of or addition to a licensed’s ability, I like to be aware of where things stand.
Another major policy issue has been how many business licenses the state will grant. Is the OCM any closer to finding out what the threshold might be?
Reid: Cannabis Control Board has to give that directive. At a board meeting last year, they did a resolution around licensing targets and coming to some conclusion around that – and the best that we can do as an agency is to provide the board with as much information about what the market looks like and what we’re seeing.
In December, the OCM made a recommendation for licensing based on what was happening. All of the cultivators and processors distributors that we have are licensed, but they still need to be operationalized. The impact will not be known until this October.
We also want to avoid oversaturation and devaluation of licenses, as we have seen on the supply-side in other jurisdictions. We can only do our best to pay attention to the situation on the ground and what has happened in other countries.
On the retail front, our recommendation was to have between 1,600 to 2,000 stores open, yet we only have 335. Retail still has a great deal of potential. Again, we are waiting on the board for something concrete and conclusive to be made about what the industry can expect in light of OCM’s recommendation.
Have you any idea what will happen to the thousands of applicants who are waiting in the queue from December and still holding onto the hope that one day they might get a license?
Reid: Many people in the industry have high hopes, but at some point those hopes will meet with cold realities of market forces and other factors. What I tell businesses all the time is to not plan for an industry that does not exist yet. Keep an eye on what other countries are doing. Attention to the possible long-term outcomes of policies or practices is important, as that will be what your company needs to focus on.
The most successful people in the industry are always doing research to find out what’s going to work.
We’ve started to walk into the December queue on the retail side specifically, because if we’re not done with the November queue, we’re about to be done.
What do you hear and see in terms of the unlicensed markets, not only in New York City but throughout the State? Does that remain a problem?
Reid: There is an issue. This is a problem. This requires that we as an agent be equally tenacious, and get in front of how things move. We’ve witnessed all manner of unlicensed machinations. The mail is also a source of fraud.
It’s also great that our Trade Practice Unit was created to allow us to pursue licensees of these machines. This work continues. Our OCM investigation team was out in other jurisdictions training them on enforcement practices over the past two weeks.
We would have a much simpler time tackling this issue if our state was smaller. Our state is large, with many regional differences in attitudes and environment. In addition, we want to ensure that our law enforcement colleagues at the local levels are also stepping up their enforcement efforts.
A CAURD licencee told me recently that he is homeless, because he has tried to open a cannabis dispensary on the Hamptons but couldn’t make it happen. You’d want to tell that group of applicants for a cannabis licence what you would say.
Reid: What I was doing in the June of 2012 is different from what it will be in 2025. There have been so many changes, I can understand how an applicant might feel that the job market is moving away.
It is a time-sensitive industry and participation is not a guarantee for success. It’s important to me that as an agency we do not make policy errors or mistakes, or promise too much and then fail to deliver. This is because it raises unrealistic expectations. It’s important to me that an agency’s communication is clear about where it stands, its goals, and the direction it’s taking.
All I can really do is spread the word.