Medical cannabis dispensaries on Long Island may not be able to serve recreational buyers

None of the Island's five medical marijuana dispensers appear to meet local policies and regulations that would allow them to serve recreational consumers, town officials said.

State regulators are weighing standards for the recreational cannabis sector that would allow each medical marijuana firm to "co-locate" — or incorporate recreational sales — at one dispensary in late December. These hybrid facilities would still need to meet local rules for recreational dispensaries, and on Long Island, none of the five medical dispensaries listed on the state Office of the Cannabis Management's website appear to do so.

Three of the medical marijuana facilities — Sunnyside in Huntington Station, MedMen Inc. in Lake Success and Curaleaf in Carle Place — are in towns that opted not to allow recreational pot shops and lounges, town officials confirmed. The Botanist's medical dispensary in East Farmingdale isn't located in an industrial zone, as required for recreational shops, according to Ryan Bonner, a spokesman for the town. Columbia Care's medical facility in Riverhead appears closer to housing than is permitted for shops that sell to consumers without a prescription, Town Attorney Erik Howard said.

With the "unregulated market rapidly increasing its presence" in New York, Curaleaf would hope Long Island would want to work with the medical marijuana companies, Tracy Brady, senior vice president of communications, said in a statement.

"Curaleaf has been a member of the Carle Place community for several years, and we have been a reliable resource for regulated, safe …  and taxed medicinal cannabis," Brady said. "It would be a natural extension of our business to expand our offerings to adult-use consumers in this community and throughout the state."

Other medical marijuana companies and a trade group representing them didn't respond or declined requests for comment. 

The obstacles facing medical operators was a welcome surprise for entrepreneurs who are licensed to open pot shops on Long Island, but struggling to secure eligible storefronts. The first retail licenses have, so far, been reserved for New Yorkers who were convicted — or are related to someone who was convicted — under the old marijuana laws and have owned a successful business. These retailers are wary of competing with the medical marijuana companies, which tend to be publicly traded and have operations in multiple states.

"It's going to give us a little bit more time to work out our issues," said Hugosbely Rivas Jr., part of the Long Island Cannabis Coalition, a trade group formed by entrepreneurs who have licenses to open recreational pot shops in the region.

"They have the money to fight that fight," he said, referencing potential lawsuits.  

Under the state's proposal, the medical marijuana companies would need to pay $5 million before doing one co-location, potentially in late December. In June 2024, these firms could do a second and third co-location, which would cost another $15 million. Each medical marijuana company would be limited to one of these hybrid recreational-medical shops per county and at least one would need to be located outside of the city and its suburbs.

Despite restrictive zoning on Long Island, the medical marijuana firms in East Farmingdale and Riverhead, where localities didn't categorically opt-out of dispensaries, may have options, said Sean McGowan, partner at Kaufman McGowan PLLC, a law firm that represents recreational cannabis companies in New York and medical operators outside the state. They may seek to change the zoning at their medical facilities or apply for special permits, he said. 

The state's proposed regulations would also allow businesses to appeal to the state if they believe local zoning is too restrictive. The state's Cannabis Control Board would then issue advisory opinions that businesses may have to ask courts to enforce, McGowan said. That would be costly and cumbersome, he added. 

"Now you're holding this piece of paper. The town's been told that this [advisory opinion] is presumptive evidence that what you're doing is preempted and it conflicts with the [state] statute," McGowan said. "Are they actually going to approve your location based on that piece of paper? Or are they going to say: 'OK, well come after us then?' And now is … whoever it is stuck holding the piece of paper, now footing the legal bill to challenge it?"

With Denise Bonilla

By Sarina Trangle

sarina.trangle@newsday.comSarinaTrangle

Sarina Trangle covers affordability and cost of living issues and other business topics. She previously worked as an editor and reporter at amNewYork.