New York medical cannabis bills in legislature aim for reciprocity, nixing excise taxes

A bill currently making its way through New York’s state legislature would allow medical cannabis patients from other states to buy weed at New York medicinal dispensaries – an important step to protecting the medical market, advocates say.

“Patients’ conditions don’t understand state lines,” said Nikki Lawley, a cannabis patient advocate and founder of Nikki and the Plant. “The amount of patients that get frustrated that come to our state and can’t purchase their medicine is a huge issue.”

Under current state law, medical marijuana shops may only sell to patients registered in New York – meaning they cannot sell any products to people with medical cards from New Jersey, Connecticut or any other state. If the medical reciprocity bill passes, it would allow certified medical cannabis patients from other states to access New York medical dispensaries, so long as they can provide documentation proving their patient status.

NYS Sen. Jeremy Cooney, who introduced the legislation, said it’s problematic that New York – a state where about 1 million out-of-state workers come and go each day – does not currently allow non-residents to access medicine prescribed by health professionals.

“New York is one of the most visited states in the country, from tourists to daily workers, so many non-New Yorkers utilize our state’s services.” Cooney said. “Anyone who needs medical cannabis should be able to access it in New York if they’ve been approved in another state.”

Additionally, the bill would allow medical dispensaries to sell pre-rolls, which they are currently barred from doing.

Medical cannabis Registered Organizations supporting the bill argue that it could help mitigate some attrition from the medical program that New York has seen since the state legalized adult-use cannabis nearly three years ago, said Frank Tice, senior director of legal and external affairs at Etain, an RO owned by RIV Capital Inc.

Tice, who has worked in the cannabis industry in multiple states, said that states that launch adult-use cannabis marketplaces often see a lot of their medical patients leave the program. That trend includes New York.

New York State had more than 151,000 certified medical patients just before lawmakers passed the MRTA in early 2021. That number has since dropped to a little over 120,400, according to Office of Cannabis Management data – almost a 30,000-patient drop, and about 2,000 fewer than last February.

“We’re at this critical inflection point where the Office of Cannabis Management has started really rolling out the adult-use program,” Tice said. “When adult-use programs come online – historically, in other states – what you see is a natural attrition in the medical program.”

Etain, a member of the New York Medical Cannabis Industry Association, supported this bill when it was first introduced last year, Tice said. Last year it never made it out of committee, but Tice said he feels good about the bill’s chances this year, especially after it received a positive vote in the Senate Health Committee, and is currently before the Finance Committee.

Etain, along with the NYMCIA, are also supporting a bill in New York’s legislature – also introduced by Cooney – which would repeal the 7% excise tax medical patients pay for each purchase, Tice said. However, he’s less confident in that bill’s chances in passing this session.

That bill “is more of a TBD to see if it can be successful,” Tice said.

In a statement to NY Cannabis Insider, Cooney said a major reason it’s important not to tax patients for medical weed products is to keep them in the medical program rather than seeking marijuana elsewhere.

“We can’t have a patient decide that it’s cheaper and easier to self-medicate using the retail market, or worse, the unregulated illicit market, when they should have easy access to high-quality, pharmaceutical-grade products,” Cooney said.

However, medical cannabis advocate Lawley is a bit skeptical about nixing taxes on medical products altogether. The tax hasn’t felt too burdensome for her, and she said patients already pay significantly less for the same products offered at adult-use shops.

Lawley also worries that if the state derives zero tax dollars from the medical sales, regulators and lawmakers would be less willing to invest resources into New York’s already-underserved medical program.

“I feel that if we eliminate that tax, what’s the incentive for New York State to keep the medical program,” Lawley said. “I, personally, don’t really notice the excise tax.”

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