Envision this: You own a bar, but the energy is decidedly relaxed—even a bit posh. Instead of throwing back shots, you're customers are sharing a vape pen or tasting a cannabis confection from a licensed local bakery. There's trivia night going on in one corner, in the same area of the lounge where comedy night was happening last week. Your customers can ask a cannabis aficionado (or “budtender”) about a new type of flower at the counter, or even order table service (complete with rolling papers) from your prereserved booth.
Eventually this year, New York State will put together an Office of Cannabis Management, which will regulate the recreational market, the existing medical marijuana and hemp programs and will be overseen by a five-member Cannabis Control Board. Regulations can't be put in place until these members are in office, so it'll be a waiting game for a bit.
The new New York Recreational Cannabis law allows for an adult-use on-site consumption license and we will see Amsterdam styled coffeeships and lounges. Here are the provisions governing on-site consumption licenses.
The new law states that no applicant shall be granted an adult-use on-site consumption license for any premises unless the applicant shall be the owner thereof, or shall be in possession of said premises under a lease, in writing, for a term not less than the license period except, however, that such license may thereafter be renewed without the requirement of a lease as provided in the law. It appears that licenses will be available for two years, which can be subsequently renewed.
This subdivision shall not apply to premises leased from government agencies; provided, however, that the appropriate administrator of such government agency provides some form of written documentation regarding the terms of occupancy under which the applicant is leasing said premises from the government agency for presentation to the office at the time of the license application. Such documentation shall include the terms of occupancy between the applicant and the government agency, including, but not limited to, any short-term leasing agreements or written occupancy agreements.
ONLY THREE ADULT-USE ON-SITE CONSUMPTION LICENSES PER INDIVIDUAL INVESTOR
The new cannabis law states that no person may have a direct or indirect financial or controlling interest in more than three adult-use on-site consumption licenses issued pursuant to this chapter.
VERTICAL INTEGRATION GENERALLY PROHIBITED
No person holding an adult-use on-site consumption license may also hold an adult-use retail dispensary, cultivation, processor, microbusiness, cooperative or distributor license pursuant to this article or be registered as a registered organization pursuant to article three of this chapter.
PROHIBITION OF ALLOWING A CONSUMPTION LICENSE WITHIN 500 FEET OF A SCHOOL
No applicant shall be granted an adult-use on-site consumption license for any premises within five hundred feet of school grounds as such term is defined in the education law or two hundred feet from a house of worship.
ADDITIONAL FACTORS THE BOARD WILL LOOK INTO PRIOR TO ISSUING AN ON-SITE CONSUMPTION LICENENSE
The board may consider any or all of the following in determining whether public convenience and advantage and the public interest will be promoted by the granting of an adult-use on-site consumption license at a particular location:
(a) that it is a privilege, and not a right, to cultivate, process, distribute, and sell cannabis;
(b) the number, classes, and character of other licenses in proximity to the location and in the particular municipality or subdivision thereof;
(c) evidence that all necessary licenses and permits have been obtained from the state and all other governing bodies;
(d) whether there is a demonstrated need for spaces to consume cannabis;
(e) effect of the grant of the license on pedestrian or vehicular traffic, and parking, in proximity to the location;
(f) the existing noise level at the location and any increase in noise level that would be generated by the proposed premises; and
(g) any other factors specified by law or regulation that are relevant to determine that granting a license would promote public convenience and advantage and the public interest of the community.
ON-SITE CANNABIS CONSUMPTION APPLICATIONS WHICH HAVE BEEN DENIED WILL ALLOW FOR A REVIEW
If the board shall disapprove an application for an on-site consumption license, it shall state and file in its offices the reasons therefor and shall notify the applicant thereof. Such applicant may thereupon apply to the board for a review of such action in a manner to be prescribed by the rules of the board.
CANNABIS SOLD AT AN ON-SITE CONSUMPTION SITE MUST COME FROM A LICENSED DISTRIBUTOR
No adult-use cannabis on-site consumption licensee shall keep upon the licensed premises any adult-use cannabis products except those purchased from a licensed adult-use distributor; registered organization adult-use cultivator processor distributor retail dispenser; registered organization adult-use cultivator, processor and distributor; cooperative, or microbusiness authorized to sell adult-use cannabis, and only in containers approved by the board. Such containers shall have affixed thereto such labels as may be required by the rules of the board. No adult-use on-site consumption licensee shall reuse, refill, tamper with, adulterate, dilute or fortify the contents of any container of cannabis products as received from the manufacturer or distributor.
No adult-use on-site consumption licensee shall sell, deliver or give away, or cause or permit or procure to be sold, delivered or given away any cannabis for consumption on the premises where sold in a container or package containing a quantity or number of servings more than authorized by the board.
No adult-use on-site consumption licensee shall suffer, permit or promote activities or events on its premises wherein any person shall use such premises for activities including, but not limited to, gambling, exposing or simulating, contests, or fireworks that are prohibited by subdivision six, six-a, six-b, six-c or seven of section one hundred six of the alcoholic beverage control law or any other similar activities the board deems to be prohibited.
No premises licensed to sell adult-use cannabis for on-site consumption under this chapter shall be permitted to have any opening or means of entrance or passageway for persons or things between the licensed premises and any other room or place in the building containing the licensed premises, or any adjoining or abutting premises, unless ingress and egress is restricted by an employee, agent of the licensee, or other method approved by the board of controlling access to the facility.
RECORD KEEPING REQUIRMENTS
Each adult-use on-site consumption licensee shall keep and maintain upon the licensed premises, adequate records of all transactions involving the business transacted by such licensee which shall show the amount of cannabis products, in an applicable metric measurement, purchased by such licensee together with the names, license numbers and places of business of the persons from whom the same were purchased, the amount involved in such purchases, as well as the sales of cannabis products made by such licensee. The board is hereby authorized to promulgate rules and regulations permitting an on-site licensee operating two or more premises separately licensed to sell cannabis products for on-site consumption to inaugurate or retain in this state methods or practices of centralized accounting, bookkeeping, control records, reporting, billing, invoicing or payment respecting purchases, sales or deliveries of cannabis products, or methods and practices of centralized receipt or storage of cannabis products within this state without segregation or earmarking for any such separately licensed premises, wherever such methods and practices assure the availability, at such licensee's central or main office in this state, of data reasonably needed for the enforcement of this chapter. Such records shall be available for inspection by any authorized representative of the board.
All licensed adult-use on-site consumption premises shall be subject to inspection by any peace officer, acting pursuant to his or her special duties, or police officer and by the duly authorized representatives of the board, during the hours when the said premises are open for the transaction of business.
CANNABIS SALES RESTRICTED TO ADULTS 21 AND OVER
An adult-use on-site consumption licensee shall not provide cannabis products to any person under the age of twenty-one. No person under the age of twenty-one shall be permitted on the premises of a cannabis on-site consumption facility.
SMOKING AND VAPING CANNABIS WILL BE A PERMITTED EXCEPTION TO THE PROHIBITION OF SMOKING IN A PUBLIC FACILITY
The provisions of article thirteen-E of the public health law restricting the smoking or vaping of cannabis shall not apply to adult-use on-site consumption premises.
If you have any questions about opening an on-site recreational cannabis business, feel free to contact us at 212-233-0666..