The change in regulation announced by the New York Office of Cannabis Management allows licensed retailers to base their operations out of locations of their choosing, rather than being required to accept storefronts leased by the state. This decision was made after speaking with the first licensees who expressed a desire for more flexibility with their storefront locations. This shift in rules has been welcomed by applicants who want more control over their retail locations but has been criticized by some industry observers as a sign that state regulators and private investors are failing to fulfill their promises of support for these new businesses.
The state had previously promised turnkey storefronts and start-up loans to license holders in order to get retail sales of cannabis up and running by the end of the year, but these promises have yet to be fulfilled. The slow pace of leasing and fundraising has also threatened to undermine the advantage of a head start for the first batch of licensed retailers. The changes have also put the spotlight on a fund established by the state to cover the cost of leases, renovations and start-up expenses for licensees. So far, only $20 million of the promised $50 million has been put into the fund, and there are questions over the vetting of the private investment firm tasked with raising an additional $150 million.
