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New York’s plan to put pot dealers with convictions first in line hits snags

New York State will award its first 150 marijuana retail licenses to people penalized in the past for dealing — but a daunting application stands in the way of going legal.

September 14, 2022 Gabriel Poblete, THE CITY
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New York State is the first state in the nation to put people with past marijuana-related criminal convictions first in line for legal retail licenses — but those applicants say they’re finding the application, due by Sept. 26, dauntingly complex.

Hector Bonilla is one of more than 450 people who’ve reached out to the nonprofit legal services group Bronx Defenders for help with the piles of paperwork, and one of about 50 who are eligible to pursue a retail license.

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“I would be ecstatic, man,” Bonilla said about the possibility of scoring one of the 150 forthcoming Conditional Adult-Use Retail Dispensary (CAURD) licenses. “I can’t even believe this is happening.”

But he and many other applicants face a serious roadblock in assembling documentation of criminal cases, their past business histories and more, often looking back decades to complete the application form.

Bonilla was charged with marijuana possession twice in a month’s time back in 2000, and he said both were cases of being in the wrong place at the wrong time.

The first time, he said, he left his hat on a table at his mom’s apartment complex in the Bronx. When he returned to get it, police were there, and his hat was on the floor with weed underneath. The second time, he says he had been with the wrong crowd and police arrested someone who sold weed — but they nabbed him, too.

Bonilla said he knew how it looked, two charges back to back, so he took the judge’s deal on one charge, pleaded guilty on the other, and received a conditional discharge with a year of probation and six days of community service.

The 42-year-old said the marijuana-related conviction had affected him in the past — like when the Taxi and Limousine Commission made it harder for him to get a taxi license. But now, that 22-year-old brush with the law puts him first in line for a state dispensary license.

“I’m not even a fanatic about consuming marijuana,” Bonilla said. “Social justice, I am.”

Social equity fund

The state Office of Cannabis Management aims to have marijuana dispensaries open by late this year or early 2023, with 25 licenses going to nonprofit organizations in addition to the 150 CAURD licenses.

Once the retail licenses are issued, the marijuana supply chain will be entirely legal — OCM has  already licensed cultivators and processors — giving New Yorkers their first real opportunity to purchase marijuana lawfully.

The CAURD licenses will be available to those who have been convicted of a marijuana-related offense or have a close relative who was convicted. Additionally, they’ll have to prove they have owned or controlled a business that’s been profitable for at least two years and pay a $2,000 application fee.

The state has put some measures in place to help support these applicants, including the $200 million New York Social Equity Cannabis Investment Fund to help build out retail storefronts. In addition, the fund — managed by NBA Hall of Famer Chris Webber’s Social Equity Impact Ventures LLC — will provide loans to licensees, who won’t be held liable to repay if they default.

Since the CAURD application window opened late last month, Bronx Defenders has been holding office hours on Wednesdays for interested applicants as part of the Bronx Cannabis Hub, a partnership between the public defender nonprofit and the Bronx Community Foundation focused on social equity in the emerging marijuana industry.

Eli Northrup, a Bronx Defenders attorney involved with the hub, said the demand for help has been overwhelming — including many referrals from city government. The city’s Department of Small Business Services has separately launched a support hub, called Cannabis NYC.

The state “has done a good job on their website explaining and answering FAQs,” he added. “But aside from that, there’s not a lot of other organizations set up to help people right now. I mean, I don’t know of any other ones besides us that are helping people through this process.”

Northrup and Cristina Buccola, a marijuana attorney and industry expert, help aspiring retailers navigate the application process — assembling documents related to their criminal records, tax records from their businesses and more. The hub also connects applicants to law firms providing pro bono services to help them set up limited liability companies that will own the dispensary outlets.

Bonilla said the help of the Bronx Defenders was necessary. “The more I go into this, the more I realize I wouldn’t have been able to do this on my own,” he said.

OCM spokesperson Aaron Ghitelman said in a statement to THE CITY that the agency has set up in-person and virtual events across New York State. The agency also uploaded a video about the process to its YouTube page.

“The timing of this application opening and the application window should not come as a surprise,” Ghitelman said in the statement. “We understand that compiling some of the documents necessary for this application can take a little time, which is why we held our first workshop for prospective applicants on May 17.”

Strategizing sites

The state distributed the 150 licenses across 14 regions based on commuter-adjusted population — the number of people present in an area during normal business hours — resulting in 70 New York City licenses: 22 for Manhattan, 19 in Brooklyn, 16 in  Queens, 10 for the Bronx and three for Staten Island. Applicants will select five regions, ranking them in order of preference, with each borough considered a region.

Even among the applicants with past criminal justice contact, not everyone’s application will be weighted equally. Among the factors OCM says it will consider is whether the arrest occurred in an area that’s been especially impacted by over-policing, mass incarceration or historically low household incomes.

The office says it will also consider whether applicants have experience in a business venture similar to a dispensary, such as a retail store; and the success of that experience, based on years running the business as well as its size and net revenue.

In some cases, applicants who don’t have criminal justice histories are teaming up with those who do.

Osmont Orduña, CEO of The Cannabis Place, a business that aims to help others launch “social equity dispensaries,” is partnering with two people who qualify because of prior convictions for marijuana-related crimes. Orduña grew up in the Woodside Houses in Queens, and he listed the borough as his first choice.

“I want to give back to the community where I come from,” he said, adding that he’s planning on having his store open as a union shop under a labor peace agreement. “There’s massive opportunity for economic empowerment.”

Eric Mitchell, who currently lives just north of The Bronx, was first arrested for marijuana possession when he was 17, although he was eventually acquitted. He was ultimately convicted four times for marijuana possession, although he said he’s been fortunate to avoid major jail time, serving about a month total.

He and his team will be applying for a CAURD license. He said that while the application has been mostly straightforward, he’s had to dredge up old documents about his former addresses. He added that he’ll have a colleague who is a cannabis attorney look over his application before submitting it.

Mitchell told THE CITY his team will go for either the Mohawk Valley or Central New York, which have two and seven licenses respectively, because that’s where he has family ties. But he said he doesn’t see himself ranking any of the boroughs in the top five.

“I feel there are a lot of people in New York City who are New York City-based people who have been affected by the war on drugs severely, and who qualify for this, and who deserve a chance to be in their home,” he said. “So I don’t want to be one of those people that comes in and tries to take a license away from somebody else’s house.”

Another hopeful, who did not wish to be identified because he’s currently selling marijuana near Washington Square Park, said the application process has been a “pain in the ass.” He said that’s because the state doesn’t want to select a business that will falter.

“They’re not just gonna hand it to any Joe Schmo. Because at the end, they want this,” he said while rubbing his fingers together, making the universal hand gesture for money.

THE CITY is an independent, nonprofit news outlet dedicated to hard-hitting reporting that serves the people of New York.


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