By Aaron Gifford
Thirteen municipalities in Oswego County are legally open to future recreational-use marijuana businesses and state-issued licenses for cannabis businesses are pending in Fulton and Pulaski. But if and when the county will see the benefits of subsequent sales tax collections and economic developments remains to be seen.
According to New York State’s Office of Cannabis Management, there is one existing cannabis-related business in Oswego County, though it is not retail, Happy Healing 420 LLC, a designated microbusiness located at 69 Wilcox Road in Fulton. That address is the site of Veteran’s Ananda, a nonprofit organization located on farmland that provides medical and psychological services to military veterans.
As for the two pending licenses, both are for adult use retail dispensaries. The business in Pulaski will be called CL Canna Holdings LLC and the one in Fulton, listed at 956 S. First St., is named Leafy Wonders LLC. The state Office of Cannabis Management website does not say when those shops are expected to open.
Several towns and villages in the county, including population centers like Mexico, Cleveland, Central Square and the town of Oswego, have passed local laws prohibiting cannabis businesses. By contrast, other population centers to include Fulton, Hannibal (town and village), Hastings, Minetto, Parish (town and village) Phoenix, Pulaski and the city of Oswego will allow — by virtue of not passing laws banning them — retail cannabis dispensaries and consumption sites, according to the state Office of Cannabis Management.
Consumption sites require additional regulations beyond the standard state-issued license. One business in the Central New York location, FlynnStoned Cannabis Company, in Syracuse, is awaiting permission to open a tasting lounge above its retail dispensary, which set up shop in the Armory Square neighborhood last year. According to the business’s website, the lounge will feature a glass-enclosed smoking area “as well as a bar serving craft cannabis cocktails and various edibles.”
FlynnStoned, along with the retail dispensaries in Clay, Salina and DeWitt, presumably get their fair share of customers from Oswego County.
Ranjit Dighe, an economics professor at SUNY Oswego, said most towns, villages and cities throughout the region would collect 4% sales tax at the cannabis retail shops. While he’s confident there’s a strong customer base in Oswego County, it’s hard to know whether many of those folks have developed a loyal following to any of the existing businesses in Onondaga County and would change their shopping routine with a closer location.
Think of beer sales, he explained. A neighborhood convenience store has six-packs and cases of the most familiar brands, but those seeking a better selection of imported or craft beers may prefer to drive further to specialty stores.
“People are going to buy weed in the same way they buy beer,” he said.
But some of the most remote locations in the county, like Boylston, Sandy Creek or Pulaski, could benefit, Dighe said.
“At some point it’s really inconvenient to drive to the city,” he said. “This is a big county.”
Even though Oswego County doesn’t have a retail cannabis shop yet, Dighe said, enough time has passed to see that legalization has not been a burden on public safety or other tax-funded public services.
“You can smell it all around,” he said, but there has been no indication of a significant number of arrests or accidents. That could change, however, if and when tasting rooms and consumption sites open.”
With none of the shops in Onondaga County open a full year yet, it’s too soon to gauge if legal marijuana sales will be a significant boost to the tax coffers.
According to the Onondaga County Comptroller’s Office, local sales tax collections in that county for 2024 through mid-April totaled $145,872,366. The forecasted total for this entire year is $467,714,088, compared to the actual totals of $445,117,795 for all of last year and $400,379,700 in 2022.
In neighboring Wayne County, to the west of Oswego, all but two municipalities — the village of Red Creek and the town of Walworth — are legally open to marijuana businesses. Its first dispensary, Native Haze, opened in the town of Macedon in May. The other pot-related business, a distributor in the village of Newark, opened last year. Through the fourth quarter of 2023, the county sales tax collected from the distributor business totaled less than $100, said Rick House, Wayne County administrator.
House expects that the opening of any retail pot shops will be delayed by an ongoing court battle regarding preferential treatment in the license-granting process to veterans. Meanwhile, Wayne County has been plagued by several illegal marijuana retailers. If multiple legal cannabis businesses ever open, House said, the economic impact will be minimal.
“It probably will cost us more to manage it in the treasurer’s office,” House said. “We’re basically just the bookkeeper.”
But with dozens of retailers already open statewide and more than 100 licenses pending to include medical, retail, onsite consumption, delivery, cultivation processing, nursery operations and cooperative uses, New York state is expecting to eventually realize significant revenues through its share of the sales tax plus the 9% excise tax. The Office of Cannabis Management estimates that could amount to at least $100 million for 2024, with upwards of $670 million when more business open across the state in the year ahead.
According to the Office of Cannabis Management, 845 of 1,528 municipalities in the New York state have passed laws prohibiting retail cannabis dispensaries or consumption sites, but that still leaves nearly 700 cities, towns or villages that could collect local and state taxes from cannabis businesses.
A quick look at the website of retail dispensaries across the state indicates that most of these businesses are open at least 12 hours a day, seven days a week. Their menus are extensive, with a dozen or more choices for every product type, whether flower, pre-rolled joints, vapes, concentrates, edibles, drinks, topicals and tinctures.
Colorado, during its first full year of legalized marijuana, 2016, raked in $200 million in sales tax from cannabis sales.
Massachusetts legalized pot before New York, with the first retail dispensaries there opening in 2019. There are currently 350 stores for adult recreational use in the Bay State, with 50 more licenses pending, according to the “State of Cannabis in Massachusetts” report released on April 25.
The total number of marijuana-related businesses in Massachusetts is 1,767 to include cultivation facilities, research and testing labs and transportation companies, according to the report. Adult recreational use sales dating back to 2018 exceed $6 billion and that doesn’t even include totals for medical marijuana.
State and local sales tax on legal cannabis sales in Massachusetts since 2018 amount to about $1.1 billion, according to the report. Some of those revenues are spent on education programs to inform the public of the dangers and risks of pot consumption. This includes a driver safety program for young motorists — “Shifting Gears: The Blunt Truth About Marijuana and Driving.”
The report said 50,000 young drivers complete the marijuana awareness safety programming annually.
“This education is crucial for the safety of new drivers and others utilizing our roads,” the report said, “especially because this is the first generation of drivers to be licensed since cannabis became legal in Massachusetts.”
Traffic safety is also a concern. New York state legislators and policymakers are trying to balance with the growth of the cannabis industry here. A July 2018 state report on the potential impact of regulated marijuana in New York state noted that, nationwide, the number of drivers who use marijuana has steadily increased since 2007. There is currently no breathalyzer test for cannabis products and blood tests, because of their invasive nature, are unlikely to become the standard method for assessing if a driver is high.
With public safety enforcement measures for drivers impaired by marijuana still undetermined, the future of another massive tax generator for New York state and its municipalities — cannabis consumption sites and tasting rooms — hangs in the balance.
On May 10, New York Gov. Kathy Hochul announced that she will overhaul the Office of Cannabis Management due to the bottleneck in the licensing process, inefficiencies in the legal cannabis industry and lack of enforcement in the black market. Her announcement did not specifically address ongoing delays for retail consumption licenses or new traffic safety enforcement measures, but it did note that state-level staff will be beefed up for licensing, compliance and enforcement functions.
“We promised to build the strongest, most equitable legal cannabis market in the nation,” Hochul said in the news release “and we’re announcing long-needed steps to make New York’s cannabis program work as promised.”
