Illegal weed crackdown enters NY budget talks amid late push by Gov. Hochul

The New York state budget is weeks late, but Gov. Kathy Hochul is still trying to squeeze in one more thing: a plan to crack down on illicit weed shops. The governor said on Tuesday that she is currently in talks with lawmakers about how to best approach the issue.

“I'm optimistic I can use this window we have with the budget to ensure that happens,” Hochul said at a press conference in Albany.

Shutting down unlicensed dispensaries has been an uphill battle, even after Mayor Eric Adams launched a task force to tackle the issue in December — the same month the state’s recreational market opened. These illegal shops have proliferated across New York City since the state legalized marijuana two years ago.

Hochul introduced legislation last month that would boost fines for store violations — including $10,000 per day for illegal sales and up to $200,000 if unlicensed cannabis is found in a shop’s inventory. The bill aimed to make it easier for the state Office of Cannabis Management, the Department of Taxation and Finance, and local police to enforce cannabis and tax laws.

But lawmakers are still hashing out the details of what enforcement should look like, state Sen. Jeremy Cooney (D-Rochester) told Gothamist. Cooney chairs a new subcommittee on cannabis in his chamber.

Among Democrats in the state Senate, there’s an “overwhelming belief that enforcement's not working and there needs to be more teeth,” Cooney said. But he added that lawmakers are also concerned about cannabis being “overpoliced” in the way it was during prohibition and the war on drugs. “We don't want to go backwards,” he said.

Assembly Speaker Carl Heastie has reportedly pushed back on the governor’s proposal. "We want the legal cannabis industry to thrive, so coming up with a mechanism for that to happen without overreaching is, I would say, the issue," he told NY1 this week.

Hochul said on Tuesday that she hoped to move quickly so that licensed dispensaries would have a better chance to succeed. Only nine such dispensaries have opened statewide so far.

“We are trying so hard to stand up a legal industry,” Hochul said. “This is not easy to do. But when you set up these businesses to fail already because of illegal competition, we have to take some dramatic steps now and give the enforcement tools to the proper agencies.”

Dispensary license holders who have spoken to Gothamist are divided on how concerned they are about unlicensed competitors.

“They've warmed up the market,” said Cos Marte, who has a license and is hoping to open a shop on the Lower East Side, where unlicensed cannabis vendors are prevalent. “I’m ready to compete.”

Although Hochul said she hopes to get an enforcement plan into the budget, Cooney noted that the issue could also be determined through the regular legislative process.

“Sometimes when a policy question is included in the budget.. ... we're doing that because we know one chamber or both chambers won't have the votes to pass it legislatively,” Cooney said. “I don't think that's the case with enforcement. I think we have the votes. The devil is in the details.”

The latest budget extension is in effect until Friday. Hochul said Tuesday that a final deal is close.