The Crackdown on Illegal Cannabis Shops

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Brian Lehrer: Brian Lehrer on WNYC. By the way, a program note. We were just previewing the Democratic convention, and we will have live coverage on the station each night this week. It's NPR's live special coverage of the primetime speeches with analysis included. You can tune in tonight at 9:00 on WNYC, and then we'll have similar coverage Tuesday, Wednesday, Thursday night, but beginning tonight at 9:00 on WNYC or live stream it at wnyc.org. Now we're going to get local and talk about the crackdown on unlicensed New York cannabis shops. If you live in the city especially, and you walk around really at all in shopping districts, you've probably seen them, these bodega like shops that sell vapes, soda, snacks, cigarettes. As of a couple of years ago, when weed became legal in New York, but in May, Mayor Adams kicked off a program called Operation Padlock to Protect. Since then, the NYPD has been rapidly, by all accounts, shutting down these unlicensed cannabis shops. Nearly a thousand have been closed since the program kicked off, and they've seized more than $40 million worth of product as they try to leave the market to the legally licensed dispensaries.

Big part of the reason that they're dealing with the proliferation of these shops is because the legalization of cannabis in New York State back in 2019 was something of a bureaucratic fiasco. The licensing prospect took ages, still taking ages, and in the meantime, with cannabis newly legal, people took the opportunity, in a way you can't blame them, of taking it into their own hands and starting to sell.

Now the city and state are catching up, and trying to get the cannabis economy to come above board, above ground. We're seeing it up close in many neighborhoods. With us now to talk through the crackdown, the difference between licensed and unlicensed shops, and explain a little bit about what we can expect. Next is our own Caroline Lewis, healthcare reporter at WNYC and Gothamist. Hey, Caroline, always good to have you on the show.

Caroline Lewis: Thanks. Happy to be here.

Brian Lehrer: Listeners, we will open up the phones for you to help us report this story. What's your experience buying cannabis in New York City? Do you go to a licensed or unlicensed shop? Has your neighborhood illegal shop been shut down? Tell us what you've been seeing, 212-433-WNYC, 212-433-9692. Do you have trouble telling which storefront is an official dispensary and which one is an unlicensed illegal shop, and do you care? 212-433-WNYC, 212-433-9692. Call or text, and help us report this story.

Caroline, first, let's go back in time a little bit. When did you first start to see these shops popping up?

Caroline Lewis: Marijuana was legalized in March 2021 for recreational use. At first, when it was legalized, they still needed to set up the whole regulation mechanism. There were no legal shops. These unlicensed dispensaries started popping up in around late 2021, along with some weed trucks that were hanging out. I was reporting on it in early 2022. When I was talking to people, it was a mix of people coming from the sort of underground weed market in New York or from other states where they were saying, oh, it's legal in New York. We really want to get our brand out there and our name out there as early as possible. We're not going to wait for them to start licensing. We want that first mover advantage.

People started opening these shops, and I think once they started doing that, there were other people who saw, oh, you can make money from this, or I run a bodega, and now people are asking for weed. More recently, when I've talked to some of the people whose shops have gotten shut down, some of those are people who maybe they owned bodegas before or their families owned bodegas, and they said, you know, this seems like a good opportunity. I'm just going to do this because everyone else is doing it, and it doesn't seem like the city's shutting them down, and so I think it's shifted over time.

Brian Lehrer: Yes, and I guess you just corrected a factual mistake that I made in the intro. I said the legalization law was passed in 2019. Maybe I was thinking of New Jersey, but yes, it was 2021. Describe the recent crackdown, because people were saying for quite a while already that such a crackdown needed to take place, but they were having trouble doing it, so what changed in May, that the police are actually effectively starting to shut them down?

Caroline Lewis: Yes. The city and state both had tried a bunch of different strategies previously to try to shut these shops down, including using, like, civil actions through this local nuisance abatement law and all of that. They tried fines. They tried a bunch of different things. It all was not super effective. Then in the last state budget, there was a change in the cannabis law, and it also affected the local law. It basically said that law enforcement can shut down a shop if it poses a risk to public health and safety, just on the first inspection, without a court order.

Then the shop owner is only entitled to an administrative hearing a few days after the fact. Basically, they can go in, raid a shop, and padlock it right there. That's what's made a lot more effective. Once they go through that administrative hearing, the administrative hearing officer can recommend that a shop be reopened, say, because the padlock order was not properly administered or because there was some other mistake. Ultimately, it's up to the sheriff, who's been leading this crackdown operation, to decide whether the store should reopen. There really is just, like, a lot of authority within the local sheriff's office to shut these stores down.

When you're looking at the criteria for whether they pose a risk to public health and safety, it can include being too close to a church or school. It can include evidence that they are processing marijuana on site, which might just mean having some baggies or a scale around, or it can mean that they have evidence they've sold to minors. I think the mayor has made it clear that his goal is to shut down all of the shops, and they can sort of always find, check one of these boxes to say that they pose a risk.

Brian Lehrer: Why do they need those criteria, like being too close to a church or school or any of the other ones you just mentioned? Why can't they just look to see if this is a licensed dispensary, and if they don't have one of those licenses, then you're out of business.

Caroline Lewis: Yes, that's just sort of the criteria they laid out in the state law, but really, they've made it very easy to shut these shops down. Like, they don't need to prove that they have actual, like, THC products on site. They don't have to test the products in order to prove they are selling marijuana. They just have to say, you're purporting to sell some kind of THC product or cannabis product, and you don't have a license for it, and so we can take action.

Brian Lehrer: I see, and there is a legal issue here. Tell me about the lawsuit that some of these owners have filed, claiming that Operation Padlock to Protect is unconstitutional.

Caroline Lewis: Yes, so a group of 27 of these businesses that have been shut down filed a class action lawsuit against the city, basically saying this current legal framework and practice violates our constitutional rights to due process because we're not getting a proper trial. You're just coming in and shutting down our stores.

Then there is this sort of unilateral decision-making power with the sheriff's office, and they've also called out all these different sort of processes in ways that the Office of Administrative Trials and Hearings are conducting these hearings, and just saying, we don't have the same kind of protections that we would if this was going through a regular court system.

There is the opportunity for the lawyers, if they don't get a shop reopened, to then sort of appeal and file a claim under Article 78, saying that an agency, like in this case, the city sheriff's office, is acting in this arbitrary or capricious manner, and they can challenge it that way, but it's a much more complicated process than just filing an appeal in the same court system if this was going through the regular judicial system.

Brian Lehrer: Let's take a phone call. Here's Nancy in the East Village. Hi, Nancy. You're on WNYC.

Nancy: Hi. Thanks for taking my call.

Brian Lehrer: Sure.

Nancy: I live in the East Village. We, as I'm sure you and your guests know, have a preponderance of cannabis shops that have sprung up in the neighborhood. I would say that personally, as a cannabis user, I am not fussed at all about whether it's legal or illegal or licensed or not licensed. They try to make the argument that they got to do the enforcement for safety, but most of us have been buying weed since it was not legal. I'm not really concerned about the legality of it. I really think that if we're going to be worrying about police enforcement, all of that money and resources could be spent better elsewhere instead of just like the only thing that matters to me is cost. I don't really care if it's legal.

Brian Lehrer: There is a hefty tax that's supposed to go to positive public purposes at the legal dispensaries. Are you cost comparing and deciding that what looks to you like the same kind of weed is cheaper at the illegal stores?

Nancy: Yes, it's cheaper at the illegal stores. I'll say, personally, I never stopped buying from my old connect since before it was legal, and I'm glad that I did that, because now all of the reasonably priced stores in the neighborhood are getting shut down. I'm sorry, but I'm just going to keep buying it illegal rather than pay the higher price.

Brian Lehrer: Nancy, thank you very much. Caroline, does your reporting indicate that there are a lot of people like Nancy out there? I imagine there are.

Caroline Lewis: Yes, absolutely. We have seen that as the unlicensed stores have been shut down, legal dispensaries have reported getting a boost in business, and the state figures on sales bear that out. I think that there are some people who were shopping at the unlicensed stores who have now made their way to legal dispensaries. Some people I talk to say, they prioritize cost, convenience. Some people really prioritize that level of familiarity that they have. Because in the past, like the caller said, you know, people had a dealer, they had someone they trusted that they got it for maybe for years. Even with the unlicensed dispensaries, I think it created this level of chaos in the market. Some people tried those stores out and said, you know what? I'm going to stick with my dealer or my friend that I got it through. I just trust them more.

Brian Lehrer: Yes, and I guess the other point that Nancy raises is kind of, well, they've legalized marijuana in New York State, so why be so stingy with the licenses? Why set up this system? Why not just say, okay, this is legal, like milk is legal and beer is legal, or pick your product and say, so any store can sell legal product rather than go through this excruciating licensing process.

Caroline Lewis: Right, so I think that the issue is that they want to set up this regulated market where they really are tracking the marijuana from seed to sale, that it's all grown in state, following certain rules, and is tested for contaminants, for THC levels, for CBD levels, and all of these things. They want it to be grown and processed in a certain way, and that is sort of what defines the regulated product and the regulated market. I think that there's just been a lot of backlog in processing license applications and a lot of setbacks.

Last year, they issued nearly 500 licenses to people who had been previously convicted on marijuana charges to open dispensaries. The state loan program didn't go as planned. The bureaucracy for finding a location was really complicated. There were legal challenges, and so it took a long time for those people to start setting up their shops. Now some of them are getting opened, but we still don't even have 400 licenses statewide. Then we have now thousands of people who have applied in the fall once the general licensing window opened up, and the state is trying to work through that backlog, basically. It's just taking a while. Meanwhile, if you think about it, if they just shut down a thousand unlicensed stores, and there's a couple thousand more estimated to be scattered around the city, like there's a huge amount of demand that's not being met.

Brian Lehrer: Veronica in Brooklyn, you're on WNYC. Hi, Veronica.

Veronica: Hi there. I live in the Flatbush area of Brooklyn, and we had a ton of these sort of like what you're talking about, the illegal stores. I think, like a lot of people, and a lot of people younger than me especially, prefer to smoke the vaporizers, which is something that no one's talked about yet. Those stores, so both the illegal and legal stores are selling those. My concern, so when I went to the legal store and I asked about it, they said they're shutting the illegal stores down because the FDA hasn't approved those yet, and those are dangerous. My question, or what I'm wondering if anyone else has this concern, too, are the illegal stores selling things that are not safe for us? Because in that case, I would be Brian Lehrer: Caroline?

Caroline Lewis: It's an interesting question. In general, when you're buying unregulated substances, like basically any illegal drugs, you don't know what's in it. Of course, there's a bigger risk than when something is regulated and tested, even though that system also is not perfect. I think there's varying levels of risk depending on what you're getting. I do think that with vaporizers in particular, there's a bit of a higher risk.

I know a few years ago, there were a bunch of people who were getting sick from vaporizers, and I think they realized that it was like these unregulated THC vaporizers where people were using vitamin E acetate, which you really can't be inhaling. I have heard that sometimes in unlicensed stores, they sell what looks like a popular brand of vape, but are actually somehow managing to get that sort of counterfeit cartridges and make their own THC oil or whatever it is.

I do think with vapes, it's a little riskier than with flour, for instance. I will just say in terms of safety, like both the governor and the mayor of New York City have implied or straight out said in the past, that, like, there's a risk of marijuana laced with fentanyl. The State Office of Cannabis Management has put out a fact sheet, saying that there is no evidence of that. It's not to say it's 100% impossible, but it's not a major risk. Yes. So I think there's a few things to consider.

Brian Lehrer: We got a text about that. Listener writes, as the parent of a teenager, I'm happy about this development, meaning shutting down the unlicensed dispensaries. One hears about fentanyl-laced cannabis, and I would like to be able to tell my teenager that they should only use pot from a licensed dispensary, assuming the inevitability that they will one day smoke pot. I would feel better knowing the product is safe, writes that parent. Of course, you can't legally buy from a dispensary unless you're 21, but if we assume that they can obtain it somehow, I guess I understand that parents concern.

You know, a number of people are calling and writing in, Caroline. We don't have that much time left to ask the very simple question, how do I tell a legal dispensary from an unlicensed shop?

Caroline Lewis: Well, that's an easy one. It's not always super easy to tell when you're walking around, like there are unlicensed dispensaries that have invested in nice displays and look official, or will even tell you they're licensed when you ask. You can always tell by looking on the front window. There should be a seal, a New York State seal with a QR code, and when you scan the QR code, it should take you to the state's list of verified dispensaries on the State Office of Cannabis Management website, not like a Facebook page or Instagram for the store itself.

In addition, when you're looking at products, when you go in an unlicensed store, sometimes the product itself will have a California seal or claim to be a licensed product, either in New York or from another state. The New York licensed products will usually have a QR code that you can scan, that will take you to a certificate of analysis, actually giving you a really detailed breakdown of all the testing they underwent.

Brian Lehrer: Let me take one more call, because a number of people now are calling in on what they're seeing in their neighborhoods in terms of illegal shops being shut down. Let's just get one of those calls in from Tom in Brooklyn. Tom, we've got about 20 seconds for you. Hi there.

Tom: Yes, I just want to say it was incredibly amusing that there's two shops that were shut down in my neighborhood. They are both on the corners of two very busy streets, clear as day. People walked past there a thousand times. Those two guys were shut down. There are several others in the neighborhood that weren't shut down, are still open and available, and it just who they decided to go after. Whoa, these guys are easy. Let's go after them.

Brian Lehrer: They're easy because they're on the corner. They didn't actually look in the middle of the block, it sounds like. Caroline, we have a number of other people who are calling to say things like that, including, yes, the shops closed down, and then they were back three days later. Or the same people were then selling weed on the same corner, just on the street. How permanently effective does your reporting indicate this can be? We have 20 seconds.

Caroline Lewis: The sheriff is agreeing in some cases to reopen shops that were shut down because of, like, technicalities and things like that. You know, there are people who have told me they think that shops have just somehow gotten through the padlock and opened up anyway. I have not verified that, but I think it will be a bit of a game of whack-a-mole, but it seems to be pretty effective so far.

Brian Lehrer: Caroline Lewis reporting on the crackdown on illegal cannabis shops in New York City. You can see her print edition on Gothamist. Caroline, thanks a lot.

Caroline Lewis: Thanks.

 

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