Happy Friday, everyone. You’ve made it.
-JB, JR, ZH
Today’s newsletter is 915 words or about a 7-minute read.
💡 What’s the big deal?
NY, NY
Mamdani will need more than cannabis taxes to balance the budget 📈
Cannabis sales tax collections jumped over the last year in New York, but they are not likely to have a significant impact on Mayor Zohran Mamdani's proposed $127 billion budget for fiscal year 2027.
What they're saying: “Collections growth has not been as rapid as the expansion in store openings because of competition among suppliers as well as lower cannabis prices. Sales per store in NYC have been dropping each quarter since the end of calendar year 2025,” said the city’s financial report released alongside the mayor’s proposed budget.
New York City is expecting to receive about $24 million in cannabis tax revenue in 2026, according to supplemental financial information released on Feb. 17 along with Mayor Mamdani's proposed budget for fiscal year 2027, which begins on July 1, 2026. That figure is expected to jump to $33 million for the calendar year 2027.
This is primarily because the city's legal cannabis market has been expanding at a rapid pace with an estimated eight dispensaries opening every month and a city-wide total hitting 211 by the end of 2025.
Tax revenues will grow – for now: The financial report estimates that local cannabis tax will increase by about 9.4% every year from 2028 to 2030, although the report notes that price compression as the market matures could impact those figures.
Realistically, this is not likely to have much of an impact on the city government's economic health. The New York City government is expecting to collect about $83 billion in tax revenue for 2026. Consumption taxes are a small part of that.
Cannabis is the second lowest category of consumption tax, with cigarette sales expected to generate about $12 million each year through 2030.
Compared to other states: New York state taxes cannabis retail transactions at 13% with 4% reserved for local government.
Massachusetts, Missouri, Connecticut, Rhode Island, Montana, Illinois, Delaware, and Oregon all allow up to 3% in local taxes in addition to state tax. New Jersey allows 2%.
In total, cannabis sales in New York are taxed at 13%, putting the state on the lower end of taxes across other states with legal markets.
New Jersey, Connecticut, Illinois and Montana all apply taxes based on potency or weight. Washington goes as high as 37% on retail sales, while Missouri charges as little as 6%, give or take whichever local taxes are also in effect.
Most states have excise taxes between 10%-20%, according to the Tax Foundation.
-ZH
📣 Quotable
“THC is not our entire business, but it has become an increasingly important component of it,” Ryan Bandy, chief business officer at Indeed Brewing Company in Minneapolis, told The Drinks Business.
“I’d say it is responsible for about 15% to 20% of our volume and delivers 25% to 35% of our revenue. We’ve also hired more people because our business has grown. I’d say we’ve boosted our staff by about 15% simply because of the increase in volume. Without the THC line, we wouldn’t be going out of business, but we wouldn’t be nearly as healthy.”
⏩ Quick hits
Illinois retailers sold a record amount of cannabis in 2025, but overall sales figures are down to $1.5 billion from the previous year's $1.7 billion due to a decrease in prices across the state.
West Virginia Delegate Sean Hornbuckle has proposed legalizing the possession and sale of adult-use in his state, following the lead of four of its neighboring states. The proposed bill would put legalization on the ballot this November.
Yet again, Maine lawmakers are proposing a mandate that would require medical cannabis cultivators to test their products before selling them. The measure has long been a point of contention between regulators and the state's vibrant commercial caregiver market.
New York Senator Jeremy Cooney proposed a new bill that would allow liquor stores in the state to sell cannabis drinks with up to 5% THC.
Nebraska lawmakers continue to butt heads over the state's upcoming medical cannabis regulations, but they were able to agree that members of the Nebraska Medical Cannabis Commission should receive a $12,500 salary and have access to a newly-created fund to finance the commission's work.
Virginia launched a new online dashboard of the commonwealth’s medical market ahead of the voter-approved cannabis market finally getting the green light to launch.
👨⚖️ Lawsuits
A citizen in California has sued Immigration and Customs Enforcement in federal court after he was wrongfully detained during last summer's raid on a Glass House Brands facility in Camarillo, California.
🧳 People moves
MFNY Group is looking for a regional sales manager in New York City.
🤝 Deals, launches, partnerships
Curaleaf announced that it has refinanced about $500 million in debt that was due by the end of this year with 11.5% senior secured notes due Feb. 2029. $CURLF ( ▼ 3.32% )
📰 What we’re reading
Craft brewers turn to THC drinks for growth as legal uncertainty looms | The Drinks Business
Missouri's cannabis gray market: Donation model thrives at local fairs | Columbia Missourian
How Canada Become the World's Cannabis Superpower | The Fresh Toast