The state of New York apparently has consented to a court injunction temporarily prohibiting it from changing its interpretation of its own rules on how far a cannabis dispensary must be from a school or house of worship.
On September 10, the New York State Attorney General’s Office filed a proposed order requiring the Office of Cannabis Management and Cannabis Control Board to revert to its initial interpretation as to how the 500-foot distance between a school or house of worship and a dispensary should be measured. The state had previously measured the distance from the dispensary’s entrance to the school’s entrance. But, after determining the law required the distance to be measured from the school’s property line, the state notified approximately 200 dispensary owners of the change and said they would need to move their location to have their licenses renewed. The proposed injunction would suspend that change until at least February 15, 2026, allowing adult-use retail dispensary licensees impacted by the new distance measurements to keep their locations as is until at least that date.
A coalition of New York City dispensary owners who were initially told they’d need to relocate sued the state over the change.
“The OCM’s actions will jeopardize livelihoods, undermine social equity goals and further encourage consumers to turn to the illicit market,” the coalition said in a joint statement. “The state threatens to cement a flawed system that forces taxpaying licensees to start over again, which is something we cannot afford to do.”
Gov. Kathy Hochul and lawmakers have said they will amend the law to allow the owners to stay put, and the Office of Cannabis Management has been negotiating a temporary solution with the plaintiffs in the light of litigation filed by several of the impacted licensees.
New York voters passed the Marijuana Regulation and Tax Act (MRTA) in 2021, creating a legal cannabis market in the state. However, the rollout of the illegal program has been beset by numerous lawsuits challenging the adult-use regulations and other problems. Hochul even conducted a sweeping overhaul of the state’s Office of Cannabis Management.
Still, the state recently announced the legal market had hit a major milestone: exceeding $2 billion in cannabis sales since launch, including $1 billion in 2025. The state has approved nearly 2,000 adult-use cannabis business licenses.
The proposed order has yet to be signed by the Supreme Court, Albany County court, but may indicate the state intends to approve legislation that will allow the affected businesses to stay at their licensed locations. Our Cannabis Industry Team will continue watching this and related matters and report back as necessary.
If you have questions or need assistance with a cannabis-related matter, please contact attorney F.L. Gorman at (585) 419-8628 and flgorman@harrisbeachmurtha.com; attorney Jason W. Klimek at (585) 419-8646 and jklimek@harrisbeachmurtha.com; or attorney Meaghan T. Feenan at (518) 701-2742 and mfeenan@harrisbeachmurtha.com; or the Harris Beach Murtha attorney with whom you most frequently work.
This alert is not a substitute for advice of counsel on specific legal issues.
Harris Beach Murtha’s lawyers and consultants practice from offices throughout Connecticut in Bantam, Hartford, New Haven and Stamford; New York state in Albany, Binghamton, Buffalo, Ithaca, New York City, Niagara Falls, Rochester, Saratoga Springs, Syracuse, Long Island and White Plains, as well as in Boston, Massachusetts, and Newark, New Jersey.
