New York Gov. Kathy Hochul last week announced a significant overhaul of the state’s Office of Cannabis Management, including a leadership change at the top of the agency.

The governor’s office said in a press release on Friday that she had “directed an operational overhaul” of the agency, which “follows the release of a 30-day assessment conducted by a team of individuals under the leadership of the Commissioner of the Office of General Services Jeanette Moy, that identified significant structural limitations to the Office of Cannabis Management that have affected the agency’s ability to fulfill its mandate to efficiently establish New York State’s cannabis marketplace.”

Hochul detailed the changes at a press conference in Albany, where the New York Times reported that “Chris Alexander, the executive director of the Office of Cannabis Management, was notably absent.”

According to the Times, Alexander “will step down at the end of his three-year term in September.”

Hochul called for the assessment earlier this year, saying at the time that New York’s legal cannabis rollout had been a “disaster.” Moy was directed to assemble a team to conduct a 30-day review of the office of Cannabi Management. In a letter to Hochul sent last week, Moy said that it was “clear from speaking to operational staff that they are dedicated, mission-driven, and working very hard,” and that in “order to alleviate pressures on staff, the task force took immediate action to recruit for vacant license processing positions to increase the size of the licensing team by 40%, and to explore technology like softphones to improve the hybrid work experience.”

Moy said that the task force “outlined recommendations to enhance customer service and expedite the opening of Adult-Use Retail businesses in New York State’s legal cannabis market.”

“It was a priority of the task force to craft recommendations that would enable this agency to be more transparent, efficient, and responsive to all New Yorkers. In conjunction with your recently announced Enforcement Task Force to shut down illegal cannabis stores, the recommendations in this report will enable OCM to maintain and build upon our State’s commitment to social equity, while maturing into a world-class regulatory agency for a thriving New York State cannabis market,” Moy said.

In Friday’s press release, the governor’s office said that the “assessment makes comprehensive recommendations to end the bottleneck of license applicants and improve communication with applicants and licensees – transforming the Office’s capacity to expand safe, legal cannabis operations across the state.”

“Based on the assessment’s findings, Governor Hochul announced a series of immediate actions to reform the licensing processes and increase enforcement against illegal storefronts. The Governor also announced the establishment of a $5 million grant program to help CAURD licensees and previewed next week’s launch of the Cannabis Enforcement Task Force,” the announcement said.

New York’s legal cannabis market has had a sluggish rollout; according to the New York Times, there are only 122 legal recreational cannabis dispensaries in the state, while “the number of illicit shops in New York City alone has nearly doubled to 2,900.”

“At the end of April, more than 5.600 applications, mostly for retail and craft businesses that submitted them as far back as August 2022, were still waiting to be reviewed,” the Times reported.

The governor’s office said that the “assessment identified significant impediments to the Office’s effective processing and approval of applicant licensure.”

“Without best capability to fulfill the licensing role, the individuals this process is designed to help are exhausting substantial resources navigating it and risk being left behind. Delays in the legal marketplace have created a vacuum for illegal storefronts to proliferate and squeeze out CAURD licensees. The reforms announced today will create additional capacity for closing illegal storefronts and lifting up legal operators,” the press release said.

Hoy said in a statement on Friday that the “multi-agency task force created to assess the Office of Cannabis Management has identified several steps the agency can take to unclog the bottleneck of applications by improving communication with applicants and streamlining the application process.” 

“The proposals outlined in the task force’s report will improve transparency and open lines of communication in the application process while boosting the state’s efforts to meet Governor Hochul’s commitment to equity in New York’s cannabis market,” Moy said.

In a statement, Hochul thanked Moy and her team “for their hard work and thoughtful assessment,” saying she looks forward “to working with OCM to implement the report’s recommendations and transform New York’s cannabis industry.”

“We promised to build the strongest, most equitable legal cannabis market in the nation, and we’re announcing long-needed steps to make New York’s cannabis program work as promised,” Hochul said.

But the Times said that the report “immediately drew backlash from critics who said it painted an incomplete portrait,” with some arguing that “it omitted or glossed over the role of the governor, the Legislature and the many lawsuits against the agency in the challenges facing the cannabis program.”

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