Mayor Adams’ big crackdown

Plus, House bill wants to get rid of cannabis testing for enlisting

Thursday, May 16, 2024

Good morning.

It’s almost Friday. 

In this one, we take another look at New York, and much more.

Let’s get to it. 

-JB & JR

This newsletter is 809 words or about a 4-minute read. 

💡What’s the big deal?

Mayor Adams touts his crackdown

@NYCMayor on X

Driving the news: Earlier this month, New York City Mayor Eric Adams launched “Operation Padlock to Protect,” an initiative to shutter storefronts selling illicit cannabis.

He’s using a new rule provided by the state’s 2025 budget, which allows authorities to close stores for up to a year while the case works its way through the courts. 

What happened: He’s now touting the first batch of results. In a post on X, Adams said the operation has sealed 75 storefronts and issued over 3,800 violations. 

What he’s saying: “With the legal authority behind us, we'll usher in a safe, thriving, and legal cannabis market. We won't let bad actors undermine legal shops and overrun our neighborhoods,” Adams said. 

And: "Good riddance to illegal, unlicensed shops like this that have been selling to minors, that are selling untested products, that are not paying taxes," New York City Council member Erick Bottcher told ABC.

What’s next? There’s certainly a long way to go. There are an estimated 2,900 storefronts selling illegal cannabis in New York City alone.

But the fact that these are storefronts — rather than street sales — might make it easier for police to ferret out bad actors. 

The final word: New York clearly wants to help legal businesses outcompete illicit ones. That’s a great goal, and much-needed as many entrepreneurs have poured time and money into businesses that have yet to get off the ground.

But, there are the optics of legalizing cannabis on a criminal justice reform basis, just to, well, criminalize it again.

And, we’d like to see more pathways for traditional market growers to go legal, with less red tape. The incentives still need to be more effective.


🗨️ Quote of the day

“But to me, this was a governor looking for an excuse to remove Chris Alexander, and not a governor who just actually wanted to see all the facts,” Aaron Ghitelman, a former deputy communications director for the New York Office of Cannabis Management, told us on yesterday’s Cultivated Live. “Because she had so many other tools at her disposal she could’ve used and instead went with an agency she was able to politicize and control every step.”

Ghitelman discussed his time at the OCM, the recent report from New York’s Office of General Services, Executive Director Chris Alexander’s departure, and much, much more. 

Quick hits

The House version of the National Defense Authorization Act would remove cannabis testing requirements for military service if passed, reports Politico.

Ohioans will be able to purchase legal cannabis without a medical card by June, after a state agency approved existing medical cannabis operators to apply for a license to sell consumer cannabis. Ohio legalized cannabis in December. 

And in other Ohio news, 47 Ohio cities and townships have voted to temporarily ban cannabis sales

Lawmakers want to lower the price of cannabis in New Jersey, saying it hurts medical patients. They’re considering price caps for patients, as neighboring Pennsylvania has instituted, reports New Jersey Monitor.

📊 Earnings round-up

Cresco Labs reported a $2 million net loss on $184 million of revenue for the first quarter of 2024. 

Ayr Wellness reported a $106 million net loss — an improvement from $194 million from the same quarter last year — on $118 million revenue for the first quarter of 2024. 

TILT Holdings reported a net loss of $9.7 million, almost double the loss from the same quarter a year prior, on $37.5 million of revenue for Q1. 

Medicine Man Technologies (Schwazze) reported a $16 million net loss on $41.6 million of revenue. 

Gold Florareported a $13.7 million net loss on $32 million of revenue for Q1.

🚀 Deals, launches, partnerships

Vermont-based cannabis brand Upstate Elevator Supply Co is expanding its product line with gummies and beverages infused with hemp-derived THC.

🏢 People moves

Massachusetts Cannabis Control Commission is hiring a new Executive Director. Applications will be accepted through June 15.

📰 What we’re reading

What did you think of today's Cultivated Daily?

Login or Subscribe to participate in polls.