Advice to cannabis business hopefuls: Have plenty of capital 

The recreational marijuana business will be lucrative for local municipalities and business owners but the upfront costs could be expensive — if you're lucky enough to obtain a license to grow, distribute or sell weed, a panel of experts said during a Newsday Live event Thursday.

The state Office of Cannabis Management has been drafting rules for the industry, including license requirements for businesses involved in every part of the sector.

The experts said regulations could be released next month while the state plans to start accepting and reviewing applications for all types of licenses by the end of 2022.

In the meantime, Daniel Johnston, founder and general counsel for Gotham Growth Corp. in Hauppauge, a company that plans to process cannabis, said businesses planning to apply for licenses should be drawing up detailed business plans to account for expected costs, including insurance, infrastructure modifications, security, compliance and inventory.

"It's not going to be cheap no matter how you cut it," said Johnston, a lawyer based in Garden City.

But the costs, he said, will be different "if you're opening a 20,000-square-foot Walmart of weed or if you're opening just a little small countertop place with everything in the back."

More than 80% of Long Island’s towns, villages and cities — including all of Nassau — opted out of allowing the sale of recreational marijuana, with just the towns of Brookhaven, Babylon, Riverhead and Southampton opting into the program.

Jessica Naissant, who recently shuttered her Valley Stream CBD store, said Nassau made a mistake.

"Long Island essentially opted out of 3% of tax revenue and are now sending all of their residents into New York City," said Naissant, who plans to open a marijuana retail store in the city. "Although they did opt out, it doesn't stop Long Islanders from consuming or purchasing cannabis."

Naissant was given priority in obtaining a "conditional" license as a social equity applicant because she was arrested in college for a marijuana-related offense.

The state Cannabis Control Board voted last month to award conditional licenses for cultivating recreational pot to 52 farms, including the regional firms East End Flower Farm Ltd., Plant Connection Inc. and Route 27 Hempyard LLC. Conditional licenses are only available to farmers with experience growing hemp — a plant that comes from the same species as marijuana, but contains less of the tetrahydrocannabinol (THC) compound that produces a high.

Ryan Andoos, co-owner of Route 27 Hempyard, a 12-acre farm in Moriches, said he's expanded in the past six years from growing hops for the craft industry to cultivating hemp and now to recreational weed.

He said the industry will be "a tremendous boon" for the economy and a host of local business owners. 

"The sky is the limit," said Andoos, chair of the Long Island region for the New York State Cannabis Growers and Processors Association trade group. "You could do it on a budget or you could spend millions. It depends on how you go about it."

By Robert Brodsky

robert.brodsky@newsday.com@BrodskyRobert

Robert Brodsky is a breaking news reporter who has worked at Newsday since 2011. He is a Queens College and American University alum.