After a slow start in NYS, number of legal cannabis stores skyrockets, Hochul says
Gov. Kathy Hochul said the number of legal cannabis stores in the state has skyrocketed, with retail sales topping $1 billion since 2023. Credit: Dreamstime via TNS
ALBANY — After a slow and tangled start, the legal cannabis business in New York is hitting some new milestones.
The number of legal cannabis stores has skyrocketed from about 80 in early 2024 to 275 by the end of the year, Gov. Kathy Hochul announced.
Further, retail sales have topped $1 billion since 2023, with about $800 million coming in 2024, the governor said.
The increases occurred after Hochul overhauled the state Office of Cannabis Management, changing leadership and adding more licensing staff, among other changes that industry insiders said have the state’s cannabis market moving the right direction.
The Hochul administration also expedited closures of illegal pot shops.
"Today, we recognize the $1 billion milestone as more than just a number — it’s a testament to the hard work of those who helped build the strongest cannabis industry in the nation, one that prioritizes equity, ensures public safety and empowers communities," the governor said in a statement Tuesday.
The numbers show improvement after years of delays, legal battles and criticism about mismanagement.
New York legalized recreational marijuana in March 2021 under then-Gov. Andrew M. Cuomo. Under investigation for sexual harassment allegations and other issues, Cuomo resigned in August 2021, with Hochul moving up from lieutenant governor to replace him.
Cannabis regulations were slow to be put in place, as was staff. A New York goal of awarding the first batch of licenses to certain qualifiers, including "justice-involved" individuals — people who had a past marijuana conviction — became the subject of litigation, holding up license awards for a period.
Hundreds of legal dispensaries were supposed to be open by early 2024, but only 80 did.
In May, an audit launched by Hochul said the Office of Cannabis Management was handicapped by inexperienced leadership, a haphazard management structure and poor customer service.
Hochul eventually named a new acting executive director for the agency, Felicia A. B. Reid, added new staff for licensing issues and started a state trooper-led task force to target illegal cannabis shops.
About 450 illegal shops have been shuttered, but thousands still operate, state officials have said.
Meanwhile, license applications have been processed quicker.
"Governor Hochul’s efforts to improve the regulation of New York’s cannabis industry have made a significant difference," Britni Tantalo, president of the New York Cannabis Retail Association, told Newsday. "The Office of Cannabis Management is more responsive, engaged and collaborative. There’s still room for improvement, but cannabis retailers have seen tangible improvements that enable our members to open and operate profitable businesses."
Overall, the state expects to have more than 600 retail shops opened by the end of 2025. OCM projects sales to top $1.5 billion in 2025.
OCM reported that more than half of the adult-use shop licensees are "Social and Economic Equity applicants, with significant representation from minority- and women-owned businesses," meaning those who come from economically marginalized communities, those with past marijuana convictions and other qualifiers. This was a priority outlined in the legislation setting up New York’s legal marijuana market.
Increased sales have meant more tax revenue for the state as well as municipalities.
New York recorded $67 million in tax revenue for cannabis sales for the first six months of its 2024-25 fiscal year (which ends March 31), the Hochul administration said. That’s a much higher pace than the $80 million it collected for all of fiscal 2023-24.
On Long Island, Newsday recently reported Babylon has collected $2.6 million in cannabis-related taxes in 2024 and Suffolk County another $871,000. Babylon was home to the first three legal dispensaries to open on the Island.
Babylon Town Supervisor Rich Schaffer said the town is reaping more revenue than he believed it would. Though he initially opposed retail cannabis shops, he told Newsday the town has "turned it into a positive" through revenue to expand services, especially for mental health and addiction services.
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