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For the past several months, a growing number of cannabis entrepreneurs, along with attorneys, consultants and real estate agents, have sought a definitive answer to an important question:

Will those licensed under NY’s conditional adult-use retail dispensary program be allowed to use their own location, or must they accept whatever spot the state assigns them?

As a refresher, under Gov. Kathy Hochul’s “Seeding Opportunity Initiative” announced in March, New York aims to raise $200 million through public and private financing to, in part, identify, secure and renovate dispensary sites throughout the state, then place CAURD licensees in these locations.

These first-round licenses are reserved for those who have been negatively affected by the drug war, and will place “equity-owned businesses at the front-end of New York’s adult-use market,” according to the governor’s office.

The Office of Cannabis Management and Cannabis Control Board published draft CAURD regulations in March and, after receiving more than 600 public comments, finalized those rules with no changes last month.

Those rules made it clear that anyone awarded a CAURD license would have to accept whatever geographic location they were offered under the program.

But here’s where things got confusing:

Shortly after finalizing the regulations, the OCM responded to public comments it received over the past several months in a 46-page file published on its website. One comment asked whether an applicant would be required to accept a dispensary location from the state, or if they could use their own location and still receive a CAURD license.

“The proposed regulations do not insist upon applicants to use New York Social Equity Cannabis Investment Fund locations and provide for the allowance of an applicant to provide their own location that complies with the proposed regulations.”

The agency’s response directly contradicted its own regulations, which prompted a flurry of questions from those in the cannabis industry – especially among attorneys and consultants who are advising entrepreneurs as to whether they should spend their time and money applying for CAURD, or wait to apply for a future license that will not require potential relocation.

“I have a number of clients who are considering whether or not to apply for the CAURD license,” said Jeffrey Hoffman, a NYC-based attorney who focuses on the cannabis industry.

“The requirement that they locate their business in one of the [state-provided locations] is probably the main element impacting their decision-making process, so the confusion about this has definitely had an impact,” Hoffman said.

NY Cannabis Insider emailed, called, and texted the OCM last week for clarity, but the office would not respond. Then – at some point around the weekend – the agency removed from its website the file that contained the contradictory guidance and replaced it with another file that deleted that conflicting language.

But on Monday, the office published a notice of adoption regarding the CAURD regulations in the NY State Register – and left the original response to the public comment around locations in the notice.

On Wednesday, an OCM spokesperson responded to NY Cannabis Insider’s request for clarity by stating that the answer to the million-dollar question about CAURD locations was contained in the regulations, which say a licensee shall enter into and comply with all terms and conditions “including, but not limited to, accepting a dispensary location identified by the fund or office ...”

NY Cannabis Insider then asked the office to confirm that the conflicting language now contained in the NYS Register is inaccurate – but the agency has not responded.

NY Cannabis Insider’s conference schedule for the rest of 2022 is now available! Get tickets to our NYC meetup on Aug. 23, our Syracuse half-day conference on Sept. 23 and our full-day conference in Tarrytown on November 4.

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