The New York Times reported that New York Governor Kathy Hochul ordered a top-to-bottom review of the state’s licensing bureaucracy, beginning today and headed up by Jeanette Moy, the commissioner of the Office of General Services.
This comes just a few weeks after the Governor described the adult-use rollout as “a disaster” and reportedly canceled a Cannabis Control Board meeting when she learned that only a small number of licenses would awarded.
According to the Times, the Governor said Moy had “a proven track record of improving government operations and would provide a playbook to turn around the cannabis management office “and jump-start the next phase of New York’s legal cannabis market.”
In an interview, Ms. Moy told the Times that “her goal was to work with the cannabis management office “to identify ways in which we can support them as they look to streamline and move forward some of the backlogs and challenges that may be faced in this industry.”
The article also stated that the Office of Cannabis Management (OCM) executive director Chris Alexander seemed to welcome the review and said he believed Ms. Moy “would help us get where we need to be.”
The move comes not long after a blistering report from New York Cannabis Insider that the OCM had retaliated against small businesses that dared to criticize the agency. Jenny Argie, one of New York’s first licensed cannabis processors, is now suing the OCM for recalling her products which she claims was in response to her appearance on a podcast. The OCM has engaged in few recalls and Argie feels she was targeted for saying negative things about the OCM.
The OCM is facing numerous lawsuits related to the licensing process. When adult-use cannabis was first legalized in the state, it was widely expected that the 10 original medical license holders would be first in line. The medical program is a vertical operation where the dispensaries grow their product and sell it on their shelves to patients. Instead, the OCM scrapped that plan at the last minute and completely switched the structure to the opposite of vertical. The OCM also pushed the medical operators known as RO’s (registered organizations) aside and favored social justice applicants instead. This huge pivot has caused chaos ever since.
The social justice applicants known as CAURDs (conditional adult-use retail dispensaries)thought they would get help with loans and real estate. Instead, they have shouldered many of the financial demands themselves. Many have said they are financially struggling now as they face steep competition from the illicit market.
The unlicensed operators flourished as the OCM made its big pivot and had to start from zero to create a new program. That pause in the calendar opened a window for the illicit market which many think will never be shut down.
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