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Navigating the Obstacles to Cannabis Legalization | The Edge ft Sen. Liz Krueger
The Bluntness, Inc.
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Why She Did It? New York State Sen. Liz Krueger on Spearheading Cannabis Reform

After seven years of consistent effort, cannabis is finally fully legal in New York. This is in no small part thanks to the tireless work of New York State Senator Liz Krueger of the 28th District, who has been a passionate advocate for cannabis legalization over the past several years. 

“It took us seven years to pass the bill here, but we learned a lot over the course of those seven years. We looked at what was working and not working in other states, and tried to get the best model possible built into our legislation,” Krueger says in regards to New York’s recent legalization through the Marijuana Regulation and Taxation Act (MRTA). 


Krueger sat down with The Bluntness’s Gregory Frye for an episode of The Edge to discuss her journey in spearheading cannabis reform in The Empire State.

The History of Krueger’s Cannabis Advocacy in New York

There are many reasons Krueger has backed cannabis legalization so passionately for the past several years, but social justice is certainly at the forefront. Throughout the U.S., Black Americans are 3.64 times more likely to be arrested for cannabis possession than white Americans, and 8 times more likely in New York before legalization.

“The motivation I had to get involved was looking at the statistics in New York from the last decade of who was getting thrown into the criminal justice system for the use of small quantities of cannabis, and it was horrifying to me. It was so radically skewed to young people who were Black and Brown being arrested for cannabis smoking, being moved through the criminal justice system,” Krueger says. 

“Even if they never went to jail on these issues, they ended up with records. They ended up being exposed to police precinct houses, arraignment courts...and we’re talking 90 percent of the people arrested being Black and Brown.”

These people quickly discovered that, for something as small as getting caught with a joint on their person, they could end up losing eligibility for all sorts of things: certain college grants and loans, living with their families in federally funded housing, and not being able to take civil service tests for some of the good-paying jobs that should have been available for their future.

Although Black and Brown teenagers have been arrested for cannabis at exceedingly higher rates than their white counterparts, research has revealed that people are prone to use cannabis at equal amounts regardless of race or gender. 

Once Krueger became aware of the depth of this issue, she immediately recognized it as something fundamentally wrong. She also recognized that prohibiting cannabis wasn’t decreasing use of the plant at all, and the New York government spending about half a billion dollars per year to bust people for low-level cannabis use was doing nothing but ruining lives.

“Maybe we didn’t know this 50 years ago, but we now know that marijuana has less [harmful] health effects on us than alcohol or tobacco, two products that aren’t outlawed in any state in the country, and yet we were approaching cannabis the same way we’d be approaching heroin or fentanyl,” Krueger says, noting that those substances, too, are worthy of conversations. “So, I decided I was going to attempt to draft a law that would make adult-use cannabis legal.”

How Krueger Helped Bring New York’s Medical Cannabis Program to Fruition

Krueger came to the conclusion that she would draft an adult-use cannabis bill before New York even had their medical cannabis program in place, and she had a plan. 

If she put in a bill for adult-use cannabis, no matter how many people called her crazy for it, it would force the governor to support medical cannabis in an attempt to kill the idea of adult-use ever happening in New York.

Three days later, Governor Cuomo signed New York’s first medical cannabis bill, although the program was incredibly restrictive and difficult for patients to access. 

The medical cannabis program in New York has since been redefined along with the new adult-use legislation, allowing for wider access and clear guidelines around hemp and CBD as well. 

For Krueger, the road to cannabis reform in New York was filled with plenty of hurdles and challenges.

She started off with conversations – as many as she could take on. “I talked to everyone. Whoever wanted to talk to me. I had elected officials who would say, ‘Look, I want to be with you, but my community is not there. Will you come and talk to them if I host a town hall meeting?’”

Krueger agreed to every town hall meeting that came her way, prepared for hostility, and while she was occasionally met with rancour, what she discovered was that the majority of the people out there just didn’t have the facts. 

She began coming prepared with credible information and statistics, ready to combat negative stigmas and misconceptions, the most prominent one being that cannabis is a “gateway drug.”

“People have this belief that it will lead to heroin and fentanyl and opioid addiction, and I would try to walk through the research that has shown marijuana is not a gateway drug. Marijuana could be addictive to some people who are prone to addiction, but it has a lower rate of ‘addiction’ than alcohol or tobacco, and it’s mostly psychological and can be gotten over fairly easily,” Krueger says. 

As Krueger continued her research, she also discovered that although cannabis was illegal, it was easier to obtain than alcohol or tobacco at the time – especially for anyone underage.

“That’s what I was told by police all over the state,” Krueger says. “That you need ID to get alcohol or tobacco, but for marijuana, you can use an app and order a delivery to wherever you are in the state of New York in like, twenty minutes. Nobody’s asking your age – nobody’s asking anything, because it’s an illegal process.”

Essentially, Krueger recognized that legalizing cannabis would eliminate the laundry list of risks that goes along with relying on an informal market. 

She also saw that legalization would help the state be more accountable in regards to who is buying and selling cannabis. 

“I would explain to people that if they think they’re worried about marijuana for their kids or other people in their lives, they need to understand that it’s here. It’s just not legal, and they’d be much better off with a legal system.”

The Damage Anti-Cannabis Laws Have Done To New York (And The U.S. As A Whole)

With a legal market, consumers will be able to know exactly what they’re purchasing and what its contents are with the assurance that it’s been medically tested and approved – without feeling like they’ve had to take a massive risk just to get a little weed. 

A legal market also may help get rid of the racist, anti-Mexican connotations that have gone hand in hand with “marijuana” since the 1920s, she says.

“There was a point in history where marijuana was being grown in Mexico and brought over to the U.S., and the U.S. was worried that there was too much economic activity on the Mexican side of the border and was advantaging them, not us,” Krueger says. “That was the 1920s. And yet to this day, you still hear people talking about the ‘evil Mexicans’ and their marijuana.”

Between economic manipulation and police officers having to meet their arrest quotas, cannabis use has been wrongfully targeted throughout the country (and other parts of the world) for decades, and New York hopes to contribute to a new standard that results in a more honest and fair criminal justice system overall. 

“I think cannabis prohibition has done harm to our police and corrections system, because you discourage people who really want to fight crime from wanting these jobs, because they’ll say, ‘I didn’t want to be a police officer so that I’d be busting teenagers for something that I don’t even think is wrong, so I’m not going to do this.’ So you discourage people from going into policing for the right reasons, and then you’ve created this system which just plays on itself over and over again,” Krueger says.

This flawed system not only harms the police officers who want to fight actual crime – it also harms the Black and Brown children who’ve been raised to rightfully distrust the system that wrongfully targets them. 

“It changes how parents teach their children, and then it changes the child’s relationship with the criminal justice system long before they even are making a decision about whether they’d ever think about using marijuana,” Krueger says. 

Krueger recalls an instance from about 25 years ago, when Rudy Giuliani was Mayor of New York City. Krueger was at a work lunch with mostly women when the following discussion came up: How old should your child be when you teach them how to not get killed by the police?

“I went, ‘What is this conversation?’ And the other women go, ‘Oh, you’re white, you guys don’t do this. If you were a Black or Brown parent, you know you have to teach your kids how not to end up getting arrested or shot by a police officer, when whatever is going on has absolutely nothing to do with your child. They’re just there,’” Krueger remembers.

“I go, ‘You actually have a lesson plan?’ ‘Yes. What do white people teach their kids?’ And I said, ‘If you’re in trouble, go look for a police officer.’”

Krueger never forgot that conversation. It was one of the first to make her realize what a real problem this is, and how commonly it has occurred throughout the nation.

New York’s Hope for the MRTA to Function As A Model For Other States

Over the years, Krueger has worked with advocates from drug policy and civil rights organizations to discuss the specific impact that anti-cannabis laws have had on communities of color. She understood their messaging to be quite clear: justice.

Cannabis legalization cannot stand on its own without bringing justice to the communities that have been wrongfully targeted. Legalization is the first step, but it must include efforts to undo some of the harms that befell the communities that had to pay the price for prohibition.

This effort must include investing money from legal cannabis sales back into those communities, sealing and/or expunging criminal records, and providing functional social equity programs for cannabis brands owned by people within these communities – all of which have been included in New York’s adult-use plan.

“I can guarantee you we got some things wrong, and like other states who have gone down this road, we will make adjustments and amendments as we see that something isn’t working correctly,” Krueger says. 

“It never bothers me to recognize that, okay, you tried to do something big? There’s a decent chance you don’t get it completely right the first time out. But that’s why democracy exists – to be dynamic and to change with how things are needed.”

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Legal Cannabis Markets Hit Historic $25 Billion Tax Revenue Milestone
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Legal Cannabis Hits $25B Tax Milestone!

While 2024 set a new annual record of $4.4 billion in state cannabis taxes, California's decision to raise rates from 15% to 19% exposes the death spiral threatening legal markets nationwide

Legal cannabis markets have generated more than $24.7 billion in cumulative state tax revenue since 2014, with 2024 setting a record $4.4 billion — but California's proposed July 2025 tax hike from 15% to 19% reveals a fundamental contradiction in cannabis policy that could undermine the entire legal industry's future.

The unprecedented tax milestone represents both triumph and warning. While celebrating revenue success, industry experts warn that aggressive taxation is creating a vicious cycle that drives consumers back to illicit markets and threatens the sustainability of legalization itself.

The California Contradiction: Success Masking Systemic Failure

California leads all states with over $1 billion in cannabis tax revenue for 2024, but this apparent success masks a deeper crisis. On July 1, 2025, the state's cannabis excise tax was scheduled to rise from 15% to 19% — a staggering 26% increase mandated by a 2022 law that automatically raises rates when tax revenues decline. However, just this week, the California Assembly delivered a stunning 74-0 vote to save legal cannabis market from "Extinction Level Event." Unanimous bipartisan support for AB 564 delays the catastrophic 26% tax hike until 2030, but industry isn't out of the woods yet. The Senate vote to enact the bill will be the next crucial test of whether California is serious about saving its cannabis industry — or content to watch it collapse under the weight of its own contradictions.

All of this combined creates what industry experts call a "death spiral": when legal sales drop due to high taxes competing with illicit markets, the state responds by raising taxes further, making legal products even less competitive.

"More businesses will close sooner as the legal price is just too far away from illegally obtained products," warns Jerred Kiloh, president of the United Cannabis Business Association. "Less investment in starting or continuing cannabis operations will occur, and demand for cannabis licenses will decline exponentially."

Since January 2018, California has generated more than $6.7 billion in total cannabis tax revenue, but thousands of licensed businesses have shuttered due to what industry leaders describe as a toxic mix of overregulation, inconsistent enforcement, and sky-high operational costs that make competing with untaxed illicit markets nearly impossible.

image of California traffic road sign that says - END - at edge of cliff overlooking Pacific OceanCalifornia’s Cannabis Tax Hike Is a Death Blow to the Legal Market Photo by Patrick Perkins on Unsplash

The Illicit Market Reality Behind the Revenue Numbers

The $25 billion in legal tax revenue tells only part of the story. State-funded research indicates that illicit markets continue to supply the majority of cannabis consumers in California despite years of legalization — a pattern emerging across multiple states with high tax rates.

Amy O'Gorman Jenkins of the California Cannabis Operators Association put it starkly: "We're urging the Legislature and Administration to act quickly and freeze the tax at 15%. If we want a regulated market to survive in California, the time to intervene is now."

The fundamental equation is simple but devastating: High taxes = higher prices = lower legal demand = more illicit activity = less tax revenue. This cycle not only undermines tax collection goals but defeats the primary public safety and consumer protection objectives of legalization.

States Walking the Tightrope: Revenue vs. Market Viability

Other leading cannabis states demonstrate the delicate balance required for sustainable tax policy. Illinois generated $578 million in 2024 tax revenue with a more moderate approach, while Michigan ($524 million) and Washington ($516 million) have maintained steady growth without the dramatic rate increases that are crushing California's market.

The contrast is stark: while these states show consistent growth in both revenue and market health, California's aggressive taxation is creating what industry leaders call "a slow-motion abandonment of legalization's promise."

States like New York and Massachusetts face similar challenges, burdening cannabis with heavy taxes and rigid regulations while wondering why legal sales lag behind projections and illicit markets remain robust.

Cannabis Tax Revenue Powers State Programs — When Markets Survive

Where sustainable tax policies exist, cannabis revenue has transformed state budgets. Legal cannabis taxes have funded Medicaid, education, school construction, housing, roads, early literacy, bullying prevention, behavioral health, alcohol and drug treatment, veterans' services, conservation, job training, conviction expungement expenses, and reinvestment in communities disproportionately affected by prohibition.

California's 15% excise tax supports programs for childcare and early childhood development, medical research, youth substance abuse prevention, and environmental recovery. However, these benefits become meaningless if overtaxation destroys the legal market generating the revenue.

Industry Employment Reflects Market Stress

The cannabis workforce data reveals the strain of current policies. While the industry supports 425,002 full-time equivalent jobs nationwide, employment dropped 3.4% in 2024 even as sales grew to $30.1 billion.

"The cannabis industry has shifted from a phase of hyper-growth to one of operational discipline," said Karson Humiston, Founder & CEO of Vangst. This "operational discipline" often means businesses consolidating, closing, or moving operations to more tax-friendly jurisdictions.

The employment decline reflects more than market maturation — it signals an industry under severe regulatory and tax pressure that's forcing efficiency through elimination rather than growth through opportunity.

The Federal 280E Problem Amplifies State Tax Damage

The tax burden becomes even more crushing when combined with federal restrictions. Cannabis companies cannot deduct normal business expenses under federal tax code Section 280E, creating effective tax rates that can exceed 70% in high-tax states like California.

This federal-state tax combination creates what industry experts describe as "fundamentally dishonest governance" — leaders claim to support thriving legal cannabis industries while enacting policies that make success virtually impossible.

A Growing Problem Threatening National Legalization Goals

Twenty-four states have legalized adult-use cannabis, but California's experience serves as a cautionary tale for emerging markets. States like Ohio and New York, despite showing growth, risk repeating California's mistakes if they prioritize short-term tax revenue over long-term market sustainability.

The lesson is clear: sustainable cannabis markets require tax policies that allow legal businesses to compete with illicit alternatives. Otherwise, legalization becomes an expensive failure that generates modest tax revenue while maintaining robust criminal markets.

Policy Solutions: Learning from Success and Failure

Successful cannabis markets share common characteristics: moderate tax rates, streamlined regulations, consistent enforcement against illicit operators, and policies that prioritize market development over revenue extraction.

Assembly member Matt Haney's bill to block California's tax hike passed its first committee vote unanimously, showing bipartisan recognition that the current path is unsustainable. However, with the increase already implemented, California faces a critical test of whether political leaders will prioritize long-term industry health over short-term revenue needs.

The Real Test: Sustainable Growth vs. Short-Term Revenue Grabs

The $25 billion tax revenue milestone should be celebrated — but with crucial caveats. This revenue represents the potential of well-regulated cannabis markets, not validation of any specific tax policy approach.

California's experience proves that treating cannabis as a limitless cash cow while ignoring market dynamics leads to industry collapse. The question for other states is whether they'll learn from this cautionary tale or repeat the same mistakes.

Nationwide legalization could generate $8.5 billion annually for all states, according to tax policy researchers, but only if states adopt sustainable policies that allow legal markets to thrive rather than merely survive.

Looking Ahead: Promise vs. Reality

The cannabis industry's evolution from rapid expansion to what experts call "operational discipline" reflects both market maturation and policy-induced stress. The $25 billion milestone demonstrates cannabis taxation's potential — but California's crisis reveals how quickly success can turn to failure with misguided policy.

For policymakers, the lesson is urgent: cannabis tax policy must balance revenue generation with market viability. Success means building sustainable industries that generate consistent, long-term tax revenue while achieving legalization's broader goals of consumer safety, criminal justice reform, and economic opportunity.

The $25 billion represents not just past achievement, but a foundation that could either support continued growth or serve as a peak before policy-induced collapse. The choice belongs to lawmakers willing to learn from both success stories and cautionary tales.

Analysis based on data from the Marijuana Policy Project, NORML, Vangst Staffing, Whitney Economics, and industry reporting on California's tax policy impacts.

image of California traffic road sign that says - END - at edge of cliff overlooking Pacific Ocean
California’s Cannabis Tax Hike Is a Death Blow to the Legal Market
Photo by Patrick Perkins on Unsplash
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Death Blow: CA's Cannabis Tax

The Golden State just made it harder for cannabis businesses to survive — again. Here’s why this 26% tax hike is a gift to the illicit market.

California, the birthplace of modern cannabis culture and the largest legal weed market in the world, just pushed its struggling legal industry even closer to collapse.

On July 1, 2025, the state’s cannabis excise tax will rise from 15% to 19% — a staggering 26% increase — marking the maximum rate allowed under current state law. This decision, mandated by a revenue trigger in a 2022 law signed by Governor Gavin Newsom, reflects the grim reality: California’s legal cannabis industry is in free fall.

And this tax hike? It’s gasoline on the fire.

A Vicious Cycle: Why Higher Taxes Make a Bad Situation Worse

The justification for this increase is baked into state legislation. If cannabis tax revenues drop — as they have — the state must raise rates. On paper, that might sound like good fiscal policy. In practice, it’s a death spiral.

Cannabis sales are down not because demand has disappeared, but because California’s legal businesses can’t compete with the thriving illicit market — a market that pays no taxes, follows no regulations, and continues to supply the majority of consumers, according to recent state-funded research.

Higher taxes will only widen the price gap between legal and illegal products, driving even more consumers underground and pushing more licensed operators out of business.

historical image of store window that says - "pay your taxes now, here!" California’s Cannabis Tax Hike Is a Death Blow to the Legal Market - The Bluntness Photo by The New York Public Library on Unsplash

Industry Voices: “The Legal Price Is Just Too Far Away”

Jerred Kiloh, president of the United Cannabis Business Association, put it bluntly:

“More businesses will close sooner as the legal price is just too far away from illegally obtained products. Less investment in starting or continuing cannabis operations will occur, and demand for cannabis licenses will decline exponentially.”

He’s not exaggerating. Thousands of cannabis businesses have already shuttered due to a toxic mix of overregulation, inconsistent enforcement, and sky-high operational costs. Operators who stuck it out through the tough years were holding on for reforms — not a tax hike.

Amy O’Gorman Jenkins of the California Cannabis Operators Association echoed the warning:

“We’re urging the Legislature and Administration to act quickly and freeze the tax at 15%. If we want a regulated market to survive in California, the time to intervene is now.”

A Growing Problem Across the U.S.

California is not alone in this mistake. States like New York and Massachusetts are also burdening cannabis with heavy taxes and rigid regulations — all while wondering why legal sales lag behind projections and the illicit market remains robust.

It’s a simple equation:
High taxes = higher prices = lower legal demand = more illicit activity = less tax revenue.

Rinse, repeat, collapse.

Opinion: Stop Treating Cannabis Like a Cash Cow

What we’re seeing isn’t just bad policy — it’s fundamentally dishonest governance. Leaders claim to support a thriving legal cannabis industry, yet enact policies that make that goal virtually impossible.

By continually using cannabis as a fiscal crutch — without fixing rescheduling, regulations, licensing delays, enforcement disparities, 280E, or equitable access to capital — states like California are ensuring that only the biggest, most well-funded players can survive. And even they’re struggling.

Let’s call it what it is: a slow-motion abandonment of legalization’s promise.

What’s Next?

There is a glimmer of hope. Assembly member Matt Haney introduced a bill to block the tax hike, which passed its first committee vote unanimously on April 24. But with just weeks left before the increase takes effect, the clock is ticking.

The question is: Will California finally listen to its operators, workers, and consumers? Or will it double down on a broken system — and let the world’s largest legal cannabis market become a cautionary tale?

Image of Pennsylvania State Capitol plaque in front of the PA State Capitol.
PA House Pushes Forward with State-Operated Marijuana Stores
Photo by Katherine McAdoo on Unsplash
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PA Proposes State Cannabis Stores

House Democrats fast-track controversial cannabis bill as state weighs unprecedented regulatory model — but GOP-controlled Senate remains a major hurdle.

Pennsylvania just lit a match under its long-simmering marijuana legalization debate — and this time, it could go up in smoke or spark something entirely new.

On Tuesday, in a razor-thin 102-101 vote, the Pennsylvania House of Representatives advanced House Bill 1200, a cannabis legalization proposal with a twist: sales would flow through state-run stores, mimicking the Commonwealth’s alcohol distribution system. If passed, Pennsylvania would become the first state in the U.S. to fully legalize marijuana and control its retail sales through a government-run operation.

The bill, championed by Democratic Reps. Rick Krajewski and Dan Frankel, rocketed through committee and floor votes in less than 72 hours — a pace that has Republicans crying foul and Democrats defending years of stakeholder engagement.

“This has been a transparent process,” said Frankel, who chairs the House Health Committee. “My door has been open for two years. We’ve held six hearings. The GOP knew this was coming.”

Still, Republicans aren’t buying it. “It’s being rammed through,” charged Rep. Charity Grimm Krupa, one of several GOP lawmakers voicing concerns over workplace safety, impaired driving, and the state’s potential overreach.

A Bold — and Controversial — Model

What makes HB 1200 a national outlier isn’t just its swift advancement — it’s the regulatory vision it puts forward.

Rather than opening the floodgates to private cannabis entrepreneurs, the bill would put the Pennsylvania Liquor Control Board (LCB) in charge of both licensing and operating cannabis stores. LCB would also oversee cultivation, processing, transportation, and consumption lounges — many of which could still be privately owned.

Adults 21 and over could legally purchase up to 42.5 grams of cannabis per day from LCB stores. Possession of small amounts beyond that would be decriminalized, while home growers could cultivate up to four plants (two mature, two immature) with a $100 permit.

Taxes would include a 12% excise rate on retail sales, with revenue feeding into a Cannabis Revenue Fund. That fund would support everything from expungement efforts and addiction services to minority business development and local court systems.

But it’s the state-store concept that’s drawing fire — not just from Republicans, but even some Democrats and the public.

A recent poll showed most Pennsylvanians prefer a private business model for cannabis sales. Rep. Abby Major (R), who is drafting an alternative bill alongside Democrat Emily Kinkead, stated bluntly: “There are zero votes for a state-store model in the Republican caucus.”

Progress or Power Play?

Despite the internal divisions, House Speaker Joanna McClinton (D) insists her party is ready to legalize. But with Republicans controlling the Senate, any cannabis bill — especially one this sweeping — will require bipartisan cooperation.

Even among legalization supporters, questions remain. Does a state-run retail model maximize equity and efficiency? Will it stifle entrepreneurship in favor of bureaucratic control? Or could it offer the kind of standardized safety and oversight that other states have struggled to achieve?

Meanwhile, advocates like Karen O’Keefe from the Marijuana Policy Project see a long-overdue opportunity: “It is past time for Pennsylvania to catch up with its neighbors and allow adults to relax with cannabis,” she told Marijuana Moment.

Cannabis Legalization Models: Pennsylvania vs. Neighboring States

Pennsylvania's proposed model, emphasizing state-run retail operations, distinguishes it from neighboring states that have adopted privatized systems. While this approach aims to centralize control and potentially streamline regulation, it faces criticism for potentially stifling private enterprise and raising concerns about federal compliance. In contrast, New York, New Jersey, and Maryland have embraced private-sector models, focusing on social equity and community reinvestment, though each faces unique challenges in implementation and market development.

FeaturePennsylvania (Proposed)New YorkNew JerseyMaryland
Retail ModelState-run stores operated by the Liquor Control BoardPrivately owned dispensaries with state-issued licensesPrivately owned dispensaries with state-issued licensesPrivately owned dispensaries with state-issued licenses
Possession LimitUp to 42.5 grams per dayUp to 3 ounces (approx. 85 grams)Up to 6 ounces (approx. 170 grams)Up to 1.5 ounces (approx. 42.5 grams)
Home CultivationUp to 2 mature and 2 immature plants with a $100 annual permitUp to 6 plants per householdNot permittedUp to 2 plants per household
THC LimitsFlower: max 25% THC; Edibles: 5mg per serving, 25mg totalNo specific THC limitsNo specific THC limitsNo specific THC limits
Taxation12% excise tax; additional 3% local tax for on-site consumption lounges13% combined state and local tax6.625% state sales tax; up to 2% local tax; additional excise fees9% state sales tax; additional local taxes permitted
Social Equity ProgramsLoan and grant programs for applicants with income below 200% of area median income and justice-impacted individualsPrioritization for individuals with past cannabis convictions and those from disproportionately impacted communitiesPrioritization for individuals from economically disadvantaged areas or with past cannabis convictions75% of licenses awarded to minority-owned businesses; strict advertising and packaging regulations to protect youth
Public ConsumptionProhibited; fines ranging from $100 to $200Prohibited in public placesProhibited in public placesProhibited in public places
Employment ProtectionsOff-the-job use protected; exceptions for federally contracted workers and explicit company prohibitionsOff-the-job use protected; exceptions for safety-sensitive positionsOff-the-job use protected; exceptions for safety-sensitive positionsOff-the-job use protected; exceptions for safety-sensitive positions
Implementation StatusPassed House; pending Senate approvalLegalized; implementation ongoing with challenges in licensing and enforcementLegalized; implementation ongoing with over 100 legal stores operatingLegalized; implementation ongoing with focus on minority-owned businesses and public health education

What’s Actually in the Bill?

Here are some of the key provisions of HB 1200:

  • Retail and Licensing: Cannabis would be sold exclusively through state-operated stores. The LCB would license 50 cultivators, processors, and transporters, plus micro-licensees.
  • Possession & Use: Adults could purchase up to 42.5 grams daily. Possession beyond that (up to 3x the limit) would be decriminalized.
  • THC Limits: Flower capped at 25% THC; edibles limited to 5mg per serving, 25mg total.
  • Social Equity: A new loan and grant program for equity applicants, defined by income, community impact, and justice system involvement.
  • Tax Revenue Allocation: 50% to community reinvestment, 10% to treatment, 5% to cannabis business development, 2.5% to minority biz support, 2% to court expungement programs.
  • Employment Protections: Off-the-clock cannabis use can’t be penalized (with some exceptions).
  • Home Grow: Limited to four plants with permit.
  • Public Consumption: Still banned; fines range from $100–$200.

The Road Ahead

While HB 1200's advancement is historic, it’s far from law. Senate Republicans remain cold on legalization altogether, let alone a state-controlled model. Senate Majority Leader Joe Pittman recently said there’s “no consensus” among the four legislative caucuses or with the governor’s office.

Still, Democratic Governor Josh Shapiro has repeatedly called for legalization — though he hasn’t endorsed the state-store concept. In March, he bluntly stated: “Pennsylvanians are driving to other states and paying their taxes.”

It’s a sentiment echoed across the political spectrum. Even some Republican lawmakers admit that prohibition has been a “disaster.” But whether they’re ready to get behind this particular vision remains to be seen.

With neighboring states like New York, New Jersey, and Maryland already enjoying adult-use cannabis markets, Pennsylvania risks being left behind — again. Whether it embraces a public-sector model or a more traditional privatized framework, one thing is clear: legalization is no longer a matter of “if,” but “how.”

This article includes reporting and original source material from Marijuana Moment and journalist Kyle Jaeger.

retail shelves stocked with legal cannabis products
The mix of in-state and out of state brands at a legal NY dispensary
The mix of in-state and out of state brands at a legal NY dispensary
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NY's Pot Industry: Wins, Woes, Next

Despite crossing $1 billion in sales, New York’s cannabis market reveals a fragile ecosystem where equity ambitions, high taxes, and regulatory drag threaten to blunt its full potential.

Two years into New York's adult-use cannabis rollout, the state's Office of Cannabis Management (OCM) has dropped its most comprehensive look yet at the market's performance, challenges, and opportunities. The 2024 OCM Market Report is packed with impressive numbers and lofty intentions, but peel back the layers and a more complicated story unfolds—one where equity goals face harsh economic headwinds, regulatory delays hamper progress, and a persistent illicit market looms large.

Here's what you need to know:

$1 Billion and Counting: A Sales Surge Worth Celebrating

As of the end of 2024, New York's legal adult-use cannabis market has generated more than $1.02 billion in retail sales, with $869 million of that coming in 2024 alone. The fourth quarter of 2024 shattered records with over $333 million in sales. By April 2025, the number of licensed dispensaries had climbed to 363.

That's no small feat for a state that only began regulated adult-use sales in December 2022. Consumer demand is clearly there—particularly in downstate regions like Manhattan, Queens, and Long Island, which accounted for over 58% of total sales.

But before we light a joint in celebration, let’s take a closer look at the fine print.

graph of NY Cannabis Retail Sales by Quarter 2024New York Cannabis Retail Sales by Quarter - 2024 - The Bluntness

Equity on Paper, But Economic Reality Bites

The MRTA's mandate that 50% of licenses go to social and economic equity (SEE) applicants has technically been met—54% of adult-use licenses were issued to SEE applicants as of December 2024. CAURD licensees, many of whom are justice-involved, make up 70% of all open dispensaries.

Still, the financial picture is grim for many of these operators. Over one-third of dispensaries are generating under $2 million annually—a threshold considered unsustainable in most regions due to high operating costs and steep taxes. Meanwhile, just 10 shops account for 26% of total sales.

2024 New York Market Share by % of Sales - The BluntnessThe Bluntness

Despite fee waivers and state support, the data suggest that equity licensees are struggling to survive, let alone thrive. The state's well-intentioned goals risk being undermined by market dynamics that favor capital-rich players, including the Registered Organizations (ROs) who are already outperforming in terms of sales per location.

Taxation Nation: A Competitive Disadvantage

New York's cannabis tax structure remains a sore spot. With a 13% retail excise tax layered on top of local sales tax and additional THC potency taxes (though now repealed), legal operators face margins that are razor-thin. That gives illicit operators—still prevalent in many parts of the state—a distinct price advantage.

Even with increased enforcement and over 1,500 illicit stores shut down, the black market continues to flourish, undermining legal businesses and depriving the state of much-needed revenue.

License Backlogs, Delays, and Confusion

Licensing delays and litigation have hampered the industry from day one. Although over 1,600 licenses were issued by the end of 2024, only a fraction of them are operational. Many applicants have waited months for updates, even after securing real estate and investing heavily.

OCM's new "single point of contact" model aims to streamline the process, but trust is still being rebuilt. The LOCAL Map tool is a step in the right direction, but many operators still face steep learning curves and a minefield of regulatory compliance.

Consumer Trends: Edibles, Vapes, and Bigger Brands

Flower still leads the way at 33% of sales, but consumer demand is shifting. Vaporizers (28%), edibles (14%), and concentrates (11%) are gaining traction. Price-conscious buyers are gravitating toward value options, particularly ounce-sized packages from ROs, which are cheaper on average than those from adult-use cultivators.

Brand loyalty is starting to emerge, with the top 5 brands accounting for 21% of total sales and the top 20 capturing nearly half. However, over 500 brands are currently in the market, and competition is fierce.

pie chart breaking down marketshare by product category in NY's legal cannabis marketShare of market by product category according to 2024 OCM Report - The Bluntness

Retail Disparity: A Tale of Two Markets

While sales are booming in Downstate regions, the Upstate market tells a different story. Despite having more open dispensaries, Upstate regions only accounted for 42% of reported sales in 2024. Dispensaries in less densely populated areas face longer ramps, higher per-store operating costs, and less customer traffic.

Moreover, while ROs and a handful of high-performing CAURD stores dominate sales, the bottom third of licensees are operating below breakeven. Many SEE licensees are still in limbo due to financing, construction, and municipal zoning delays, putting them at risk of falling behind before they ever open their doors.

What Needs to Happen Next?

The OCM recommends:

  • Continuing to prioritize and support SEE operators with real financial tools.
  • Streamlining the licensing process with more transparency and accountability.
  • Re-evaluating tax policies to make legal products competitive with the illicit market.
  • Encouraging brand diversity and innovation to capture more market share.
  • Strengthening data systems to improve market monitoring and consumer safety.

But recommendations alone won't fix structural issues. If New York wants to fulfill its promise of a socially equitable, thriving cannabis market, it must move faster, regulate smarter, and tax more fairly.

Because if not, the state's billion-dollar baby may never grow up.

Blunt Verdict: Progress, Yes. But Let’s Not Confuse Motion with Momentum.

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