Two state agencies in New York have issued fines against unlicensed smoke shops for selling cannabis products, but only a small fraction of the fines have been collected. The Office of Cannabis Management (OCM) has collected $22,500 in fines, while the Department of Taxation and Finance has not collected any fines yet. The enforcement process has faced challenges, including paused hearings and appeals processes. The state is prioritizing shutting down illegal shops and seizing unlawful products. Despite ongoing raids, the collection of fines has been slow, highlighting the difficulty of enforcing cannabis laws in a state with a thriving gray market. Gov. Kathy Hochul has emphasized the seizure of illicit products in press releases. More enforcement powers are being sought to address the issue. The state is also looking to open more legal stores as part of the enforcement effort.
Enforcing Cannabis Laws: Challenges and Progress
In the past year, the state has imposed over $25 million in fines on unlicensed smoke shops for selling cannabis products. However, only a small fraction of these fines have been collected by the state Tax Department and the Office of Cannabis Management. These two agencies were given expanded authority to enforce the 2021 cannabis law and have been conducting joint raids on smoke shops selling cannabis products without a license.
The fines can be levied against individuals running the shops or the businesses themselves. The Office of Cannabis Management has collected $22,500 in fines, while the Department of Taxation and Finance has not collected any fines to date. Last October, it was reported that the state cannabis agency had paused enforcement hearings due to resource constraints, leading to some cases being withdrawn.
Despite the challenges in collecting fines, the state is prioritizing shutting down illegal shops and seizing unlawful products. The process of collecting fines can be appealed, which can further delay the collection efforts. The state has seized millions of dollars in illicit products as part of its enforcement measures.
In New York City, unlicensed smoke shops are prevalent, with estimates suggesting there are thousands of such establishments. The Office of Cannabis Management has a limited number of investigators, and other agencies, such as the Sheriff’s Department and the NYPD, are also involved in enforcement efforts.
Governor Kathy Hochul has emphasized the need for new enforcement powers to combat illegal cannabis stores. Senator Jeremy Cooney, chair of the Senate Cannabis Committee, believes that additional enforcement measures should be accompanied by the opening of new legal stores to address the issue comprehensively.
At a Senate hearing, the executive director of the Office of Cannabis Management expressed the view that fines may not be a sufficient deterrent for unlicensed shops. The agency is seeking expanded enforcement powers to close down stores instead of issuing fines.
The fines imposed by the Tax Department are based on a formula that calculates the amount owed by unlicensed shops, taking into account the quantity of illicit cannabis seized. However, the agency has not yet collected any fines from unlicensed shops, as some cases have been withdrawn by the Office of Cannabis Management.
Moving forward, there is a need for a coordinated effort to enforce cannabis laws effectively. While challenges exist in collecting fines from unlicensed shops, efforts are being made to strengthen enforcement measures and shut down illegal cannabis stores across the state.
Source: TheCity.NYC
