Many New Yorkers are waiting with bated breath to legally purchase adult-use cannabis once the NYS Office of Cannabis Management (OCM) gives the go-ahead. I’ve seen it a few times, in Colorado and Massachusetts: the anticipation, comradery, exhaustion and simultaneous annoyance of higher prices due to taxation and waiting on line the first day of legal cannabis sales.
But do consumers know what those first 200 retail dispensaries across New York will actually look like? Well, look to our northern trés chic neighbor, Montreal, and their government-operated stores.
Following the April 9 New York state (NYS) Budget Bill, which provided $50 million in public funds and statutory powers to the Dormitory Authority of the State of New York (DASNY), NYS published a Request for Proposal, ending June 13, for prevailing contractors to provide fully furnished, “turn-key” dispensaries, fully equipped with POS systems, security, safes, cameras, bathrooms, offices, etc. For those envisioning funky, innovative and unique stores, DASNY will likely render these first 200 dispensaries fairly uniform inside and out, with the exception of a so-called “branding wall” for the license holders to get creative with.
Retail Details
DASNY’s May 13 Design-Build Services for Select Retail Cannabis Dispensaries Request for Proposal RFP #7586 offers a sneak peek at the first 200 NYS adult-use retail dispensaries.
According to the RFP (request for proposal), DASNY will act as agent for New York’s Social Equity Cannabis Investment Fund, LP (NYSECIF) to identify suitable commercial retail properties for dispensaries, and design and outfit these leased premises based on forthcoming retail dispensary security regulations. NYSECIF will then sublease these properties to prevailing retail license applicants to operate. Prevailing proposers should be selected by July 11 to start the design and construction of cannabis dispensaries throughout New York state.
These dispensaries will be “equitably dispersed across” 10 geographic regions throughout New York state, according to NYSECIF, with New York City being Region #1. DASNY “anticipate[s] that approximately 150 dispensaries will need to be completed across the State," with the heaviest concentration in the NYC metropolitan area, including Long Island and Westchester. Rough approximations in other parts of the State include 20 to 25 in Western New York, 15-20 in the Hudson Valley/Capital District region, 5 to 10 in the North Country, and 5 to 10 in the Southern Tier region of the State.”
Interestingly, DASNY’s RFP envisions dispensaries ranging from 3,000 to 5,000 square feet in size being built by various regional contractors, who will also handle all the filing, permitting, licensing, and regulatory approval responsibilities. (It’s hard to imagine DASNY securing 3,000 sq. ft. retail spaces in prime commercial corridors in NYC!). Contractors will design and install security systems and cameras compliant with the forthcoming security regulations, as well as “furnishing and equipping” the dispensaries.
Building Regulations
This RFP offers those thinking of applying for second-round/private-property retail licenses the general requirements for these state-built stores. For the sales area, the reception area may be enclosed or open, and the check-in area may be separate or combined with the reception area, both depending on location. Dispensaries may also have an open sales floor and display area, including a prominent “branding wall,” with sales counter and service space allowing for “approximately 5-10 point of sale areas and/or kiosks.”
This RFP also prescribes the prevailing contractor to construct a “back of house” area for staff to “move, process, package and fulfill customer product and merchandise orders,” as well as a receiving area and a “Cannabis Processing Workroom.” Other requirements include a vault and/or secure storeroom; a “Quarantine/Secure” waste storeroom; office space and a staff breakroom; employee and customer handicap-accessible bathrooms; a janitor’s closet; and an electrical/data/security closet. The RFP asks for a floorplan and layout to “allow for the best disbursement and flow of clients / visitors while feeling inviting and personal.”
Security Requirements
Dispensaries will require interior and exterior video surveillance, access controls, and intrusion systems, with security plans complying with NYS Department of Health security requirements. These include alarms and backup alarms; motion detectors; video cameras with 24-hour recording (9600dpi) and date/time stamp; panic button at sales counter; glass break sensors; automatic voice dialer or digital dialer; failure notification system; “ability to remain operational during a power outage”; maintenance of all security equipment and recordings in a restricted secure location; illuminated exterior; doors with pinless hinges; and secure network access.
The Cannabis Storage (Vault) must have walls and ceiling framed with heavy-gage metal studs and joists with 9-gage expanded metal mesh installed on the non-secure side of framing with tamper proof fasteners.
Exterior windows shall meet all requirements of the current NYS/NYC Energy Conservation Construction Codes and include laminated glazing treated with security film to prevent the glazing from falling out, if broken.
Additional enhanced security measures may be required in certain localities, such as NYC, where privacy screening, roll-down security gates, and use of ballistic glass may be required.
Odor Mitigation systems, with ventilation and filtration systems to mitigate the cannabis odor, may be required in certain localities.
HVAC and Backup Power systems (battery or generator) will be required during a power outage to provide continuous power for access control for secure doors, 24/7 remote alarm, camera surveillance and recording systems, and preferably HVAC conditioning for IT/Data Room and Vault and POS stations as well.
Turn-Key Buildout for the First 200 Retail Dispensaries
DASNY will have NYSECIF’s contractors build out the interior, from flooring to the “Branding Wall,” according to the RFP, along with ATMs, furnishings, fixtures and equipment, and Point of Sale (POS) systems, for the first 200 license holders. The store will be fully connected as well, either through WiFi or LAN wiring, to POS, seed-to-sale tracking system and security systems. Essentially, DASNY will hook up the entire dispensary.
New York has radically redefined social justice in launching these new adult-use retail dispensaries. As any operator knows, launching a successful retail cannabis business requires a tremendous amount of research, time, knowledge, relationships and understanding of contracts, commercial leases, and most importantly, start-up capital. By eliminating the knowledge gap, securing the commercial property, and fronting the equipment needed, New York doubled down on its commitment to ensuring those with prior cannabis convictions (or their immediate family member) have a fair and equal chance to succeed. (The first 200 Conditional Adult-Use Retail Dispensary (CAURD) licenses will be awarded to applicants who were convicted of a NYS cannabis conviction, or had an immediate family member convicted, and meet other applicant requirements.)
This radical commitment to economic equity and fairness will certainly court many naysayers and detractors, but at its core, those left financially and personally devastated by cannabis convictions may finally have a fair shot at rebuilding their lives.
Wei Hu, Esq., is the founding partner of MRTA Law, PC, a boutique NYS cannabis law practice with offices in Manhattan and Ulster County. He also teaches Social and Economic Equity in Cannabis at LIM College in New York City, and is a member of the NYS Cannabis Industry Association.
