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New York’s Fight Against Unlicensed Cannabis Shops and What’s Ahead for 2025

January 19, 2025

New York, NY — As New York continues to expand its legal cannabis market, a persistent issue lingers: unlicensed dispensaries that threaten the integrity and profitability of the industry. Despite notable enforcement efforts in 2024, unauthorized cannabis operations remain widespread, raising concerns about public safety, lost tax revenue, and the viability of licensed businesses.

Tackling the Illicit Market

In 2024, New York’s state agencies ramped up efforts to combat illegal cannabis shops. Enforcement teams conducted hundreds of raids, resulting in the seizure of $30 million in unlicensed cannabis products and the closure of over 160 illicit dispensaries. These measures were part of Governor Kathy Hochul’s broader campaign to bolster the legal market by targeting unregulated sellers that undermine the state’s nascent cannabis industry.

To curb visibility, the state also urged digital platforms, including mapping services like Google and Yelp, to remove listings for unlicensed dispensaries. However, many unauthorized shops continue to operate, especially in major cities like New York City, highlighting the scale of the enforcement challenge.

Growth Projections for 2025

Despite these challenges, New York’s cannabis market is positioned for significant growth in 2025. The Office of Cannabis Management (OCM) anticipates a dramatic increase in the number of licensed dispensaries, projecting the total to exceed 625 by year-end, up from 275 in 2024. Industry analysts estimate that legal cannabis sales could surpass $1.5 billion in 2025, building on the $840 million generated last year.

“This growth is critical to achieving our vision of a robust, sustainable cannabis market in New York,” said Felicia Reid, Executive Director of the OCM. “However, it must be accompanied by continued efforts to address the illicit market and protect legal operators.”

Challenges on the Horizon

One of the biggest obstacles to the state’s cannabis ambitions remains the unlicensed market, which continues to capture a majority of consumer spending. A recent study by Whitney Economics found that only 15% of cannabis sales in New York are currently made through licensed retailers. The study suggests the state could support over 1,300 legal dispensaries if enforcement successfully transitions consumers to regulated channels.

Another concern is the risk of market oversaturation. While increased licensing could enhance accessibility, experts caution against an uncontrolled expansion that might destabilize prices and hurt small businesses.

Joseph Belluck, Chairman of the New York State Cannabis Advisory Board, emphasized the need for balance. “It’s critical that we grow the legal market responsibly, ensuring that licensed operators can thrive while minimizing disruptions from the illicit sector.”

A Model for Legalization

As New York heads into 2025, the state is working to fine-tune its cannabis strategy. With plans to expand the legal market, crack down on illegal operators, and refine regulations, New York is positioning itself as a leader in the national cannabis landscape.

The success of these efforts could serve as a blueprint for other states grappling with the challenges of legalization. For New York, the coming year will be a pivotal test of whether the legal cannabis industry can deliver on its promise of economic growth, social equity, and public safety.

A 2025 Roadmap Without Recreational Legalization

As 2025 begins, Florida remains a state where adult-use marijuana is not legalized, despite a strong push in 2024 to broaden cannabis access. The rejection of adult-use marijuana has significant implications for the existing medical cannabis and hemp industries, shaping the path forward for businesses, consumers, and advocates.

Medical Marijuana: A Growing Market with Limitations

Florida’s medical marijuana program, established in 2016, has matured into one of the largest in the country. With over 800,000 registered medical cannabis patients as of 2024, the market is a crucial lifeline for those seeking alternatives to traditional pharmaceuticals. The continued absence of adult-use legalization means:

  1. Sustained Patient-Only Model: Medical marijuana dispensaries will remain exclusive to cardholders, keeping access limited to qualified patients. For businesses, this ensures a captive market, but it also caps growth potential compared to states with dual medical and recreational frameworks.
  2. Stricter Regulations: Medical cannabis remains under stricter state oversight, ensuring product quality and safety. This gives consumers confidence but increases operational costs for producers and dispensaries.
  3. Barrier to Entry: For those seeking to join the program, obtaining a medical cannabis card still requires time, expense, and a qualifying condition, which can deter potential patients.

Hemp Industry: An Expanding Opportunity

The hemp industry—especially the market for CBD and Delta-8 THC products—continues to thrive under the 2018 Farm Bill. Florida’s rejection of adult-use marijuana creates a unique environment for hemp:

  1. Delta-8 and Alternative Cannabinoids: With recreational THC off the table, demand for legal, hemp-derived cannabinoids such as Delta-8 THC and Delta-10 THC is expected to rise. These products offer psychoactive effects within the boundaries of federal law, attracting consumers seeking accessible alternatives.
  2. Regulatory Scrutiny: As hemp-derived cannabinoids grow in popularity, Florida regulators may impose stricter controls to prevent misuse or ensure quality, mirroring trends in other states.
  3. Innovation and Investment: Without competition from adult-use cannabis, hemp entrepreneurs have room to innovate, creating novel products like infused beverages, edibles, and wellness goods that appeal to a broad audience.

Economic Impacts: Opportunities and Challenges

Florida’s cannabis landscape presents both challenges and opportunities in 2025:

  • Missed Revenue for Adult Use: The state forgoes the significant tax revenue generated by adult-use marijuana, estimated at billions annually in other states.
  • Jobs and Investment: The medical and hemp markets will continue to drive job creation and attract investment. However, the economic potential is smaller without a robust recreational market.
  • Tourism Considerations: Florida’s status as a tourist hotspot could have made adult-use cannabis a major draw. Instead, visitors must rely on CBD and hemp-derived products, which may not meet all expectations.

Advocacy and Future Outlook

Advocates for cannabis reform are already regrouping for 2026, aiming to place adult-use marijuana on the ballot again. Public support for legalization continues to grow, with polls showing majority backing among Floridians. Until then, the focus remains on:

  1. Education: Informing consumers about the benefits of medical marijuana and encouraging eligible patients to join the program.
  2. Policy Reform: Advocates are pushing for incremental changes, such as expanding qualifying conditions or simplifying the medical marijuana card application process.
  3. Industry Collaboration: Medical cannabis and hemp businesses are finding synergies, such as cross-brand promotions and joint educational campaigns, to maximize reach and impact.

Forward Progress

The failure to legalize adult-use marijuana in 2024 has set the stage for a complex but promising year for Florida’s cannabis industry. While medical marijuana and hemp remain the pillars of the market, the absence of recreational cannabis limits growth potential and tax revenue. As the state looks ahead, the industry must innovate, educate, and advocate to meet the needs of patients and consumers while laying the groundwork for broader legalization efforts in the future.

Ohio’s Recreational Marijuana Laws: What Could Change in 2025?

In November 2023, Ohio voters approved Issue 2, legalizing recreational marijuana for adults aged 21 and over. This measure permitted possession of up to 2.5 ounces of cannabis and 15 grams of concentrate, allowed home cultivation of up to six plants per person (with a maximum of 12 per residence), and established a 10% sales tax on cannabis products. The tax revenue was designated for social equity and jobs programs (36%), communities hosting dispensaries (36%), education and substance abuse programs (25%), and administrative costs (3%).

However, recent legislative developments indicate potential changes to this framework. On January 29, 2025, State Senator Steve Huffman introduced Senate Bill 56, proposing significant revisions to the existing recreational marijuana laws. The key provisions of SB 56 include:

  • Increased Taxation: Raising the excise tax on adult-use cannabis products from 10% to 15%, with all revenue directed to the state’s General Revenue Fund.
  • Home Cultivation Limits: Reducing the number of plants individuals can grow at home from 12 to 6.
  • THC Concentration Caps: Lowering the maximum allowable THC levels in adult-use cannabis products from 90% to 70%.
  • Public Consumption Restrictions: Prohibiting smoking and vaping of cannabis in public spaces, limiting consumption to private residences.
  • Dispensary Regulations: Capping the number of dispensaries statewide at 350 and requiring them to serve both medical and recreational users.
  • Transportation Rules: Mandating that adult-use marijuana and related paraphernalia in vehicles be stored in the trunk or behind the back row of seats.

Additionally, SB 56 proposes eliminating the social equity and jobs program, which was designed to promote diversity in the marijuana industry and support individuals affected by prior marijuana prohibitions.

Proponents of SB 56, including Senate President Rob McColley, argue that the increased tax revenue is necessary to fund addiction services and law enforcement, addressing societal costs associated with marijuana legalization.

Opponents, such as Ariane Kirkpatrick, CEO of Mavuno of Ohio, express concerns that the proposed changes undermine the will of the voters and could negatively impact businesses and social equity initiatives.

As of now, SB 56 is undergoing hearings in the Senate General Government Committee. If it progresses, the bill could be presented on the Senate floor as early as February 2025.

These developments suggest that Ohio’s recreational marijuana laws may undergo significant modifications in 2025, reflecting ongoing debates between legislative intentions and voter-approved measures.