New York Bipartisan Lawmakers Call on Governor to Sign ‘Cannabis Crop Rescue Act’ as 250,000 Pounds Sit to Rot

As New York’s distressed cannabis farmers have limited buyers for their adult-use supply amid the state’s struggling rollout of a commercial retail program, a short-term and partial solution lies on Gov. Kathy Hochul’s desk.

In June, New York lawmakers passed the Cannabis Crop Rescue Act (Assembly Bill 7375 / Senate Bill 7295), legislation that would authorize conditional adult-use cultivator and processor licensees to sell tested, packaged, and sealed cannabis products and cannabis to dispensing facilities licensed by tribal nations.

This legislation, now in the governor’s hands, comes at a time when the state’s adult-use retail market has struggled to get going, with just 23 of 463 conditional adult-use retail dispensary (CAURD) licensees currently operating more than nine months after commercial sales commenced. The other 440 CAURD licensees have been left in limbo from a temporary restraining order keeping them from opening their businesses as a lawsuit unfolds.

With only 23 retail operations, the state’s adult-use cultivators—made up of New York farmers who previously participated in the state’s hemp program but were given conditional licenses to grow cannabis in 2022—have little options for their supply. There were roughly 250 conditional cultivation licenses issued as of mid-August 2022, when the state’s Office of Cannabis Management (OCM) continued to process applications.

Notably, these distressed farmers have roughly a quarter million pounds of unsold cannabis that is sitting and rotting, according to a bipartisan group of leaders who make up the ranking membership of the Senate and Assembly agriculture committees.

“Due to a variety of circumstances beyond the control of New York’s cannabis farmers, many licensees cannot afford to process their cannabis or sell their finished products,” according to the legislation. “As a result, their 2022 crops are losing value while in storage due to diminished potency, color and aroma. Without sales, many are unable to plant a crop for the upcoming growing season, and are in severe financial stress.”

The chairs of the agriculture committees—Sen. Michelle Hinchey and Assemblywoman Donna Lupardo—together with their respective ranking members, Sen. George Borrello and Assemblyman Chris Tague, issued a joint statement Sept. 13 calling on the governor to act now by expeditiously signing Cannabis Crop Rescue Act to provide these farmers some temporary relief.

The legislation provides an interim solution to address the delay in the cannabis market rollout, which is causing severe economic hardships for New York farmers, according to the lawmakers.

“While lawsuits are being litigated and illegal stores are flourishing, NY’s cannabis farmers are suffering,” the lawmakers said in the statement. “Crops were grown last year with the understanding that there would be a legal market for them to sell it. Now, 250,000 pounds of unsold cannabis is losing value each day. In June, we supported and passed a bill through both houses of the Legislature that would allow NY-based tribal nations to purchase a portion of our oversupply. We are urging the governor to quickly sign this short-term solution, one that will help provide some measure of relief to what is quickly becoming an agricultural emergency.” 

Despite this bill getting passed in early June, the 2023 outdoor season is mostly in the rearview mirror with harvests coming next month and the state of New York’s cannabis program now lined up for major changes following the Cannabis Control Board’s public meeting Sept. 12.

RELATED: New York Approves Revised Adult-Use Cannabis Regulations; Set to Open Application Window in October

Notably, state regulators intend to open an application window in October to allow all businesses—not just social equity retailers and state hemp farmers—to enter the adult-use market.

For New York’s distressed farmers, this means more uncertainty as OCM Executive Director Christopher Alexander was unable to provide an estimate for exactly how much adult-use product would be grown by the state’s existing medical operators in the year ahead.

However, licensing additional retail operators represents a double-edged sword: The move will potentially hurt the 410 CAURD licensees left in limbo by the lawsuit, while it could potentially help provide additional outlets for conditional adult-use cultivators to sell their products.

When New York first announced its Seeding Opportunity Initiative—which was designed to help the CAURD licensees and conditional adult-use cultivators find success in an equitable marketplace—Hochul said in March 2022 she stood behind positioning individuals with prior cannabis-related criminal offenses to make the first adult-use cannabis sales with products grown by New York farmers.

“New York State is making history, launching a first-of-its-kind approach to the cannabis industry that takes a major step forward in righting the wrongs of the past,” the governor said. “The regulations advanced by the Cannabis Control Board today will prioritize local farmers and entrepreneurs, creating jobs and opportunity for communities that have been left out and left behind. I’m proud New York will be a national model for the safe, equitable and inclusive industry we are now building.”

This prioritization of local farmers has now led to distressed farmers who are in urgent need of Hochul’s pen, according to state lawmakers.