Why some municipalities are opting out of marijuana sales and on-site consumption

New England

ALBANY, N.Y. (NEWS10) — It’s almost decision time for municipalities to determine whether they plan to opt out of marijuana sales and on-site consumption. The deadline to do so is December 31st.

If no decision is made by then, those cities and towns will automatically be rolled into the state’s program, says Heather Trela with the Rockefeller Institute of Government in Albany.

“Many municipalities are opting out purely because they are unsure of what New York State legislation will be. The Office of Cannabis Management got a late start because of late appointments. So a lot of municipalities are opting out for now and would consider opting back in once they know what the regulations are for allowing a dispensary or consumption site,” Trela says.

If a location does decide to opt out, they are able to change their decision in the future. However, it is not the same rules for those who already are choosing to go forward with marijuana sales.  

“The important thing is if you do not opt out, you cannot opt out at any time,” Trela explains, “that could change. They [the state] would have to change the legislation. The bigger pressing matter is that it is a commitment once you’re in the market.” 

Another reason for not opting in right away is some areas believe cannabis may not be profitable for them. “Some of these municipalities, based on the minutes I’m reading, are making a calculation that the sales may not be that high for them in the beginning, and that it is worth the wait. Just to make sure they know what they are getting into,” Trela says.

For every sale at a recreational dispensary in New York State, there will be a 13 percent sales tax. 9 percent of that tax will go to the state while the other 4 percent will trickle down to counties and their municipalities who have opted in for marijuana sales. Cities and towns who opt out will not get any revenue their county receives.

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