Counties seek state financial support to investigate illegal cannabis retailers

Press Release, NYS Association of Counties

The NYSAC Board of Directors, at its recent annual June meeting, discussed the growing problem of illegal cannabis retail operations and called on the State of New York to reimburse local governments for enforcement costs associated with regulating the illegal cannabis market.

The NYSAC board, which governs the association representing all 62 counties of New York State, expressed deep concern about the proliferation of illegal cannabis retail operations across the state and the substantial financial burden they place on local governments.

“The explosion of unlicensed cannabis retailers has undermined the regulated market while threatening public health and safety through the sale of untested and potentially harmful products,” said NYSAC President and Albany County Executive Daniel P. McCoy. “Local governments are at the forefront of combating these illegal operations, incurring substantial costs to enforce state cannabis laws and need the state to provide counties with additional funding to investigate and close these unlicensed retailers.”

The board noted that though legislation was enacted as part of the State Fiscal Year 2025 State Budget to provide the Office of Cannabis Management, counties, and cities with additional enforcement powers, more support is needed to assist local governments with enforcing state cannabis laws and regulations.

“While counties commend Governor Hochul for convening the New York State Illicit Cannabis Enforcement Task Force to shut down unlicensed cannabis businesses, it does not include any representatives from local governments, which are expected to do the lion’s share of enforcement statewide,” said NYSAC Executive Director Stephen Acquario. “Counties are seeking more communication and coordination between OCM, local law enforcement, and municipal governments to streamline enforcement efforts and ensure a unified approach to tackling illicit cannabis activities.”

While the SFY 2025 State Budget streamlined the state taxes on cannabis, it did not address the fact that counties bear the greatest burden related to cannabis legalization — from enforcement to public health protection and tax distribution — yet receive only a quarter of the local taxes on retail sales.

“There was unanimous agreement among the NYSAC board that additional support is needed from Governor Hochul, the State Legislature, and OCM to support municipal enforcement of state cannabis laws and that a more equitable local tax distribution structure needs to be established,” Acquario said. “By doing so, we can ensure that our local governments have the necessary resources to protect public health, uphold the integrity of the legal cannabis market, and maintain the safety of our communities.”