Marijuana is the most commonly used, federally illegal drug in the United States.
Here in New York, the first stores to sell legal,
recreational marijuana recently opened up in December.
For many people, legalization goes beyond just how
to purchase marijuana — it also carries hopes for social justice.
But in New York, and across the country, the growing pains of a new industry,
post-prohibition could hold some of those larger goals back.
21 states, plus the District of Columbia, have legalized recreational marijuana in some form,
but what that means is not as simple as it seems. But before we jump into how states are regulating
recreational marijuana, let's talk about why this is happening now.
In 2012, successful ballot initiatives in Colorado and Washington captured two things:
One, growing public approval for legalization of a drug
that was seen as less harmful than legal supplements like nicotine and alcohol,
and two, the disapproval of the scars left from a nationwide prohibition–especially
on the disproportionate impact it had on Black, brown communities.
But as states moved to legalize marijuana for both medicinal and recreational uses,
how they did so was unique to each state.
That’s because each state gets to construct how they legalize marijuana.
Amanda Chicago Lewis, a freelance investigative journalist who covers the marijuana industry,
explains how that could get complicated. “It could also mean that there's a vast gray
market of, you know, lightly regulated businesses that are, you know, de facto selling recreational
cannabis because anyone can get a doctor's recommendation. It's very easy to buy.
So what we have is this very strange state by state patchwork system.”
In New York, the state legislature passed a
bill to legalize recreational marijuana nearly 2 years ago.
Alyson Martin is the founder of Cannabis Wire,
who covers the marijuana industry in New York and nationwide.
“lawmakers passed a legalization bill in 2021 and basically 2022 it was a lot of
regulators spending time crafting rules for the industry and also staffing up and toward the tail
end of 2022 New York's first legal licensed shop opened.”
Shaleen Title is a former commissioner of the Massachusetts Cannabis Control Commission,
and the Founder and Director of the Parabola Center, a drug policy think tank. She says
on a national level, New York completely reframed the approach to legalizing marijuana.
It has started from scratch in the way that it's looking at licensing, in the way that it's setting
up the market structure. And much of this is based on evidence because many other states
have tried to take a social justice or social equity focused approach but haven't seen results.
To open a legal, recreational dispensary in New York, you need a Conditional Adult-Use
Retail Dispensary - or - CAURD license. That licensing program stipulates -
And that’s important Title says, because: people of all different
races used and sold marijuana at similar rates. Yet everywhere we saw black,
indigenous and land next people being targeted with arrest and incarceration.
Experts believe that this latest push to legalize recreational marijuana will
also help prioritize social equity in a way it has not been before.
The first states to legalize cannabis,
Colorado and Washington did not really take equity of the marketplace into
account. And so we saw after that the next generation of states changed their approach.
The first licensed dispensary for recreational marijuana in New York is run by Housing Works, a
non-profit that provides housing and healthcare to those living with HIV and AIDS. Since it opened,
a few more have followed. But in New York City,
it still seems that unlicensed shops are outpacing licensed dispensaries.
Right now, I think officials have calculated conservatively that there are 1400 unlicensed
shops in the five boroughs. I think that number is probably quite a bit higher.
Those unlicensed shops grew rapidly across New York City after legalization.
The COVID 19 pandemic really provided an opportunity for unregulated,
unlicensed sales because there were, you know, vacant storefronts everywhere in New York City.
Now before we go any further, unlicensed shops conveniently provide the product that consumers
want, but they can also present an array of issues.These shops don’t follow New York state
packaging laws, and some of their products contain images that are widely familiar to kids.Take
a look at these two illegally sold packages, compared with the legal one.
This illegal package features bright colors, cartoon characters, mimics popular candy and
contains no specific testing or dosage information - all illegal under New York State law.
The legal one contains clear testing information,
muted colors, and specifies that it is grown in New York.
A lot of the cannabis is not tested to the same standards of a state regulatory program.
In fact, the New York Medical Cannabis Industry Association, a trade group which represents
legal, licensed cannabis growers, found high levels of pesticides in illicit marijuana,
along with e.coli, salmonella and heavy metals. If it's unregulated, it could have a whole wide
spectrum of pesticides contained within it. If you think about something like vaping,
you know, some of those pesticides and heavy metals could actually be sort of concentrated more
than the product was even used in the first place. And in a fledgling marketplace, with only a
few legal locations so far, the nearest legal store could be over an hour away.
So, along with accessibility, unlicensed or illegal vendors have
another major plus for consumers - price. Consumers generally choose illegal shops
because of price. Why would you buy an $80 eighth of weed at a legal shop when you can
get a $25 eighth of weed at an illegal shop? Illegal cannabis is cheaper for a variety of
reasons. Not only do sellers avoid state taxes and state environmental regulations, but they can
sell marijuana grown in states with longer growing seasons - like California. But Legal cannabis in
New York must be grown in the empire state. Now, the underground market isn’t just
prevalent in New York, in fact, no state has fully transitioned its illegal market to the legal one.
The state that is generally understood to have the strongest legal market is Colorado. In Colorado,
there's about a 30 to 35% illicit market rate. That's the best case scenario. In
a place like California, the illicit market controls 80 to 90% of the market
So why is the cannabis market so hard to control - and could
the illegal market undercut hopes of social justice in marijuana policy?
Well, in states that have legalized weed such as Colorado and Oregon,
overall arrest rates for possession have dropped dramatically.
Point of clarification here: You might be asking--- how does one get arrested
for marijuana possession after it is legalized? Well, states can still
restrict how much weed you can possess, how old you have to be, and other things.
And according to the ACLU, disparities between white and Black citizens being
arrested for marijuana possession in Oregon remained the same as prior to legalization,
while having dropped in others, including Colorado.
Although there are far fewer arrests, we are still seeing strong disparities in the way that this
is enforced. And in fact, in some places it's even gotten worse. We're seeing a
bigger disparity between arrests among races. And in terms of clearing records from past
marijuana arrests, results have been mixed across states with legalization. In New York,
expungement of records is automatic for possession of 25 grams or less of marijuana.
But we've also seen states where expungement was kind of just thrown
in at the end as a compromise. And they haven't made it easy for people.
Like in North Dakota, people with lower-level marijuana convictions must apply for a pardon,
which is then reviewed by an advisory board that meets just twice a year.And honestly,
regulating this marketplace, which already existed underground, has been a challenge.
The cannabis industry is really in its infancy in
New York and even in states across the country that have had more experience.
And one of the analogies that I use is that which may not be all that flattering, but you know that
regulators, policymakers, even industry members are sort of building the plane on the way down.
State and local governments have been tasked with figuring out how to regulate the cannabis
industry - without the federal government, and with many different goals such as public health,
social justice or bringing in higher tax revenues from legal marijuana sales.
It's really hard to pursue any policy within the cannabis legal market without
somewhat unintentionally affecting a different part of the market in a negative way.
The more you regulate those things, the more expensive it gets to run a legal business,
the more expensive it gets to run a legal business,
the harder it is for those legal businesses to survive and compete with illegal businesses.
And, so far, running a legal marijuana business has not been particularly profitable.
The green rush is essentially a myth... Most legal cannabis businesses are not profitable. ... Why
is it so hard to make money on legal weed? The costs to get into the legal market are
very high. You have to pay the licensing fees. You have to pay regulatory costs.
And in a state like New York, that presents some difficult
questions around how effective this new legislation will be at
advancing the goals that advocates hoped would work in parallel to legalization.
I think everyone who's involved in legal cannabis or in advocating for social equity policies can
acknowledge that it's been a very difficult thing to achieve for a variety of reasons, because of
the thriving of the illicit market, because it's impossible for a government to legislate fairness
in business or for government for that matter, to be as quick and as nimble as businesses.
Even though legalization doesn’t seem to be an immediate fix to many issues,
advocates say that jumping to a crackdown of the illegal industry would hurt the promises
of social justice restoration. So, New York State is turning to civil
enforcement in hopes of allowing its new legal market to get its footing.
At least something like 400 letters have been sent to landlords and building owners saying,
hey, if you've got unregulated activity happening within your building, you know,
we're sort of putting you on notice that if you don't stop, we’ll intervene.
But will that potential civil oversight be enough?
Regulators need to create a accessible pathway for people who are in the underground market
to become regulated. And that is a complex and challenging task. Because think about
this if you've never had a legal business at all, and now you're going to have a business
and possibly the most regulated market there is, that's certainly going to be a process.
That means that the post-prohibition marijuana
industry needs time to work through its growing pains.
For example, in Massachusetts, the first year it was estimated that 90% of consumers
were still in the underground market. The next year, was 75%. At this point,
five years in prices have dropped significantly. My guess is that probably 50% or more of sales are
actually taking place in the regulated market. And so if we see that consistent change, then I
think we're meeting the goals of legalization. And, if done right, reaching those goals will
bring parity and opportunity to the Black and brown communities that have historically been
disproportionately impacted by the marijuana policies of the past and present.
What we don't want to do is focus so much on the underground market, eliminating the
underground market that we forget the actual goals of legalization, which include equity,
and certainly not continuing these patterns of discrimination and disparate enforcement.