Governor Hochul Updates on Cannabis Regulation Efforts Following Successful Crackdown on Illegal Shops

On Monday, August 26, Governor Kathy Hochul provided an update on New York State’s efforts to regulate the cannabis market, following a three-month blitz by the Illicit Cannabis Enforcement Task Force (ICET) to shut down unlicensed cannabis shops. The task force has made significant strides in combating illegal cannabis operations across the state, resulting in the closure of over 1,000 unlicensed stores and the seizure of nearly $29 million worth of illegal products.

Since its launch in May 2024, the ICET has conducted more than 700 inspections and issued 596 Notices of Violation. The task force, which includes 150 investigators from multiple state agencies, has padlocked 345 illegal cannabis stores and shut down 136 locations that either closed on their own or ceased selling illicit products. Governor Hochul stated, “Thousands of illegal cannabis storefronts across the State have plagued our communities and siphoned business from licensed retailers. I launched the Illicit Cannabis Enforcement Task Force to quickly close these unlicensed shops, and today, more than 1,000 have been shuttered.”

The enforcement efforts have had a substantial impact on the legal cannabis market. Since the crackdown began, legal cannabis sales have increased by 51%, contributing to over $368 million in year-to-date sales for 2024, more than doubling the total sales of $160 million in 2023. Licensed retailers across the state have reported an average increase of 50% in sales, with New York City experiencing a 97% surge.

The Office of Cannabis Management (OCM) remains committed to enforcing a well-regulated cannabis market and plans to continue efforts to shut down unlicensed cannabis shops even after the expiration of the task force. The OCM is prioritizing hiring additional investigators and attorneys to maintain these enforcement efforts and ensure compliance with state regulations. Currently, there are 166 adult-use retail dispensaries open for business across New York.

Highlights of the Enforcement Task Force Achievements:

1. Illegal Product Seizure: 7,485 pounds of illegal cannabis, valued at approximately $28.9 million, were seized during inspections.

2. Notices and Padlocks: A total of 789 inspections resulted in 345 padlocks on unlicensed stores and 596 Notices of Violation being issued.

3. Closures and Compliance: 136 locations voluntarily ceased illegal cannabis operations or were vacated following enforcement actions.

4. Legal Market Boost: Legal cannabis sales surged to $368.4 million year-to-date, with sales since May 2024 accounting for 43% of the total sales.

Governor Hochul’s administration continues to focus on supporting the growth of the legal cannabis market by cracking down on illegal operators and ensuring that licensed retailers can thrive. The state’s comprehensive approach to enforcement aims to protect consumers and support economic growth within the legal cannabis sector.