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Five Things You Need to Know About Obtaining a Retail Dispensary License in New York

June 13, 2022

Are you looking to obtain a retail dispensary license in New York?

New York became the 15th state to legalize the use of marijuana for recreational purposes on March 31st, 2021.  This was signed into law by Gov. Andrew Cuomo through the Marihuana Regulation and Taxation Act (MRTA), which also created a new Office of Cannabis Management (OCM) governed by a five-member Cannabis Control Board to regulate what the New York State government labels as “adult-use” cannabis, as well as medical and hemp cannabis.

In such a diverse state, most experts agree that the opening of such a large potential cannabis market represents an extremely valuable opportunity for prospective cannabis retailers.  One Chicago-based research firm, known as Brightfield Group, projected the state to make $2.2 billion by 2023 if legalization was achieved by 2021, which would make New York the second-largest state market behind California.  But apart from professional predictions, it’s not hard to imagine that New York’s wealth, open culture, and the size of its population will generate wealth both for small business owners and the state itself.

That’s why, for any New Yorkers who have dreamed of opening their own dispensary, now is the perfect time to prepare to apply for an adult-use retail dispensary license.  This license will allow you to acquire, possess, sell, and deliver cannabis products from your dispensary to your consumers.  But before you do, there are 5 important things you need to know before you start:

  1. Not everyone will be able to obtain a retail license immediately

As of now, the state government has stated that the first retail licenses to be awarded in New York will be reserved for individuals with past marijuana-related crimes, in order to advance the state’s efforts to make its cannabis market the most diverse and inclusive in the country.  In her January 2022 State of the State speech, Governor Kathy Hochul announced that the state would create a $200 million dollar fund to assist social equity applicants in applying for company licenses and establishing their businesses.  She also stated later that the first 100 to 200 retail licenses would be reserved for such candidates, which are anticipated to be granted by fall 2022.

Even so, the state government is doing everything it can to make sure that regular candidates have all the resources they need by the time they are eligible to apply.  Once the first dispensaries are up and running, assuming the Cannabis Control Board’s 18-month schedule is followed, we should see non-social equity applications being accepted beginning around summer 2023, at the latest.

  1. A conditional adult-use retail license is valid for 4 years and must be renewed every 2 years

The conditional adult-use retail license is a subclass of the soon-to-be standard retail dispensary license, and is required for those looking to obtain one.

In advance of the expiration of conditional licenses, conditional license holders can apply to become retail license holders, as long as they fulfill the necessary requirements.  These are as follows, as proposed by the Cannabis Control Board:

  • As mentioned, applicants must have been convicted of a marijuana-related offense before March 31st, 2021, or had a convicted family member or dependent, or been a dependent of someone who was convicted
  • Applicants must have owned at least 10% of a thriving business for two years
  • Applicants must be a New York resident if applying as one person
  • If applying as an organization, applicants must have a significant corporate presence in New York, and must have been created under New York law

As of now, conditional licenses are only accessible to applicants who both fit the necessary requirements and may get New York state aid in order to take out a loan or find a site for their dispensary.

  1. No person can obtain more than 3 dispensary licenses in New York

The only reason why someone would want to obtain more than one license in New York is because a separate retail license is required for each physical address where a business intends to operate.  On top of this, anyone with a retail license may not hold ownership or financial interest in any other license type (distribution, cultivation, processing, etc.).  But while this does put a cap on how much you can expand your business – at least within state boundaries – it also shows the inclusivity of the New York market and the seriousness with which officials in the state are approaching cannabis regulation.

  1. Applicants must pay a nonrefundable $2000 application and licensing fee to obtain a conditional retail license

While this may not prove to be an obstacle for most prospective licensees, it is still something important to consider during the strategic investment process needed to effectively set up a dispensary.  Apart from this fee, most prospective dispensary owners will also end up facing monthly costs of between $3500 and $10,000, sometimes even higher, with additional funds (usually hundreds of thousands of dollars) needed to construct or renovate the property if need be.  Such adjustments must comply with construction and cannabis retail standards, while also maximizing store flow and reflecting the image of your brand.

  1. Vertical integration of dispensaries with other stages of marijuana production will be prohibited 

In order to prevent a single dispensary from taking over too many components of its own supply chain, vertical integration between dispensaries and, say, grower businesses, manufacturers, and nurseries, will be prohibited.  Once again, the state government is emphasizing its dominant role in regulating its own cannabis market.  However, there appears to be an exception to this rule between holders of microbusiness licenses – which permit limited amounts of cultivation, distribution, processing, and delivery – and existing medical cannabis companies.


As legalization becomes more common, it also becomes more important to familiarize yourself with your state’s legalization laws, especially if you’re considering entering the business.  In states like New York, which only so recently joined the list of those to achieve legalization, there is no better time to start doing so than now.  At long last, dispensaries will soon start popping up all over the state, and, with the right knowledge at your side, yours could be one of the first.

Reach out today for a demo of the BioTrack software to learn more about opening a retail dispensary in New York!