New York businesses running illicit cannabis operations could be padlocked

New initiatives are being unveiled by the governor's office to shut down illicit cannabis operations and protect the legal marketplace.

An agreement in the Fiscal Year 2025 New York State Budget authorizes the Office of Cannabis Management to padlock businesses immediately following an inspection if they are selling illicit cannabis and are considered a threat to health and safety.

The following would be considered a threat:

• Sales to minors
• Unlicensed processing of cannabis
• Violent conduct
• Presence of unlawful firearms
• Proximity to schools, houses of worship or public youth facilities
• Products leading to illness or hospitalization
• Products not tested or labeled according to NY Law

Authorities from counties and cities will also be authorized to padlock unlicensed businesses and a misdemeanor penalty will be established for damaging or removing a padlock.
If a business is not considered a threat, OCM will issue a notice of violation and an order to cease unlicensed activity. These stores would be padlocked following a re-inspection if there is still illegal activity.

If these businesses have approval from a state agency to sell alcoholic beverages, lottery tickets, or tobacco and vaping products, OCM will send out a notice to the relevant agencies informing them of a violation, and the business will be warned they are at risk of losing their licenses.

The state will also be cracking down on landlords. If one fails to bring forth eviction proceedings against tenants in violation of cannabis law, the state says they will be held to strict penalties. That includes a fine, five times the rent from the time the landlord was notified of the violation.

Local governments will be able to adopt laws for regulating cannabis businesses. They will also have to designate a point of contact to coordinate with and report on enforcement activities with OCM.

New York will also create a statewide enforcement task force. This group will carry out civil enforcement to close illegal stores.