Revoking Tobacco Retail Licenses for Cannabis Law Violations
Committee on Consumer and Worker Protection · June 17, 2026 · 42m
Source: https://hearinghearings.nyc/hearings/committee-on-consumer-and-worker-protection-revoking-tobacco-retail-licenses-for-cannabis-law-2026-06-17/
Video: https://councilnyc.viebit.com/watch?hash=HGnIxnyshykCunCb

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Good afternoon. We will continue the New York City Council hearing on the Committee on Consumer and Worker Protection. At this time please silence electronics and do not approach the dais. If you need any assistance please reach a sergeant at arms. Thank you for your cooperation. Chair, you may begin.

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Good afternoon and welcome to the second part of our Consumer and Worker Protection hearing today. I am Harvey Epstein, chair of the Committee. I am joined by my colleagues. I know CM De La Rosa and CM Hanks are here, but CM Brewer was with us today as well. This afternoon we are hearing Int 0813-2026, which I sponsored, to refuse to renew or revoke licenses for tobacco retailers who, upon finding that the dealers are selling cannabis without a license, are presumed under state law to sell tobacco. The City retailers obtain a tobacco retailer license, and in 2018 we capped the number of licenses and we are reducing that by 50% of total licenses previously issued to distributors across the city.

To sell cannabis in the City, you must obtain an adult use retail dispensary license from the Office of Cannabis Management. The City has taken a multi-agency approach to enforcing the cannabis regulations and cracking down on the proliferation of illegal licenses. We all know we passed legalization, which I was proud to co-sponsor. I worked on the Bill to support the legal market, and this illegal market undermines all the efforts we have to support the legal market.

Int 0813-2026 would build on the progress we have made by adding new grounds to renew, suspend or revoke tobacco licenses. Now that the administration has testified earlier in the morning, we are going to turn to public testimony and have people who are here for the public. Make sure you sign up to testify. Testimony is a formal government procedure, so please show the decorum. If you are ready to testify, fill out your appearance card. You have two minutes to testify. We are talking about Int 0813-2026. If you have any written testimony please send it to the sergeant at arms.

The first panel is Paul, Amaar Fitzgerald and Vanessa Chang. Please come up to the table over here. Some of our colleagues do have to leave, but I appreciate that we started late and I appreciate everyone's commitment to staying.

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Here for the second part of our hearing today. Paul, do you want to start? Good afternoon, Council Members. My name is Paul Dark, co-owner and presenting for Transcend Wellness, a licensed dispensary. After several years of court proceedings and dealing with red tape, we were fortunate to be awarded a license. We just opened our doors about a week ago and are fighting a mountain of debt. I want to commend CM Epstein for introducing Bill 0813-2026 to hold tobacco retailers accountable for selling illicit cannabis products. I believe the Bill can do more by holding all bad actors accountable and putting licenses at risk. Equally important, I think it is important to dismantle all the illicit shops that are being allowed to operate without recourse. I think the state can and must do better to assist those who have put hard-earned effort and money into obtaining a license and working within it.

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Thank you. Amaar, you are

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next. Hi. Good afternoon, Chair Epstein and members of the Committee on Consumer and Worker Protection. My name is Martin Fitzgerald. I speak to you today as a proud member of New York City's cannabis community and I appreciate this opportunity to testify in support of Bill 0813-2026. New York's cannabis program was created with the right goals in mind: building a safe, regulated marketplace, protecting consumers, creating economic opportunity and supporting communities that have been harmed by the war on drugs. However, the rollout of the legal market has faced serious challenges and delays in developing a licensed retail network. There has been litigation, bureaucratic delays, gaps in enforcement and regulatory loopholes that have allowed illegal operators to take advantage of the transition period. The result has been a marketplace that has in many ways developed in the opposite direction of what it was intended.

Licensed cannabis businesses are required to meet rigorous standards for testing, packaging, labelling, tracking, security, taxation and all levels of compliance. Meanwhile, illegal operators — which we call illicit — have been able to sell cannabis products without any of those safeguards, undermining the legal supply chain and putting responsible licensed businesses at a great disadvantage. The state's failure to properly enforce against illegal sales has consistently created an environment where certain smoke shops began operating as if legal cannabis sales were acceptable, using cover tobacco licenses, vape licenses and also cannabinoid hemp licenses.

This is deeply concerning. As a mother, one of my greatest concerns is the way that illegal cannabis retailers operate in plain sight, often in storefronts that look like ordinary neighborhood shops — mostly candy shops and smoke shops — and they have products that resemble delicious snacks with familiar cartoon characters. They are brightly packaged and they can create a lot of confusion and increase the risk of youth exposure. Parents should not have to worry that a child walking past a neighborhood candy store will encounter cannabis products being displayed or sold outside the regulated system.

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Int 0813-2026 is an important step toward restoring accountability. It gives the commissioner stronger tools to suspend, revoke or deny licenses for businesses that violate the law by engaging in illegal cannabis sales. I also encourage the Council to expand these enforcement tools to include cannabinoid hemp and electronic cigarette retail license categories in the Bill. And a special shout out to CM Brewer for all of her enforcement efforts, even though she is not here.

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She was here though. Yes. Vanessa, this is... okay.

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Good afternoon, Chair Epstein and members of the Committee on Consumer and Worker Protection. My name is Vanessa Chang and I am the owner of All Day, a licensed cannabis retailer in the SoHo area, and a co-founder of the Cannabis Retail Alliance of New York. We are an association that represents about 40 active small business cannabis retailers in New York State. I chose to enter this industry legally. I invested my own money, went through the licensing process, paid my taxes and built a fully compliant operation. Licensed dispensaries like mine are held to some of the highest standards in retail: rigorous testing, strict packaging, labelling, security protocols, age verification — and we follow every rule.

But right now we are competing against businesses that sell cannabis illegally with none of those costs, none of those responsibilities and none of that accountability. They undercut our prices because they are not paying what we pay. That is not competition. That is an uneven playing field. I experienced this firsthand with an illicit shop operating less than a hundred feet from my location. It took six raids over the course of more than a year, along with sustained outreach on my part to Assembly Member Lee's office and Senator Kavanaugh's office, to finally achieve a thorough shutdown.

It should not take this much effort to close down an obviously illegal operation. The core problem is that there are no real consequences for selling illegally. Int 0813-2026 helps fix some of that. If a business holds a City-issued license — whether for tobacco or a hemp license — it should not be able to use that

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license as cover while selling illegal cannabis. If a tobacco or hemp retailer chooses to sell cannabis without authorization, there should be consequences for that violation. We support this Bill and we urge the Council to amend it to include electronic cigarettes and cannabinoid hemp retailers who are creating the same problem.

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This is also about consumer safety. Products sold in licensed dispensaries are tested and tracked. Products from illegal shops are not. Illegal sellers do not check IDs, making it easier for kids to access cannabis. We are not asking for special treatment. We are asking for a fair marketplace and the tools and resources to enforce that.

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Thank you. I know we are joined by CM Banks, who had to run up. He is also a member of the Committee. I know we have a couple of other witnesses to testify, but...

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Just wait. We have other people testifying. You want to come up? Yeah, well, just... we will have you as a second panel. I do not know.

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Quickly, just a question. Yeah, yeah. So I appreciate this suggestion about adding e-cigarettes and hemp. Can you tell us

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how you see that playing out on the ground, where hemp licenses or e-cigarette licenses are being used as a cover for illegal cannabis? Well, I have personal knowledge of certain CBD licensees actually using that license as a mask to sell cannabis. There are several across the city.

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And including chains?

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Yes. And the one shop that I had shut down — that was at 64 Kenmare, very close — they had a CBD license. They did not have a tobacco license. They had a CBD license and they were raided. It is even on TikTok apparently, but they were raided for having illegal cannabis. I also want to state that coming out and speaking about this also puts owners at risk.

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I literally have shops operating across the street from me, two doors down. I have gone to licensed dispensaries where people will sit in a chair literally across the street attempting to solicit customers walking into these dispensaries. My job should be running an operation. I am being forced to run my business and also advocate for my existence, which really takes me out of it.

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So I recognize that this Bill is attempting to rectify these situations, but it should not take this long to shut down illicit shops.

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I appreciate that. You know, we worked with the sheriff in my district two years ago to shut down 72 illegal shops and obviously shutting them down does not mean they are closed forever. I understand this is a problem that we are collectively trying to fix and I do appreciate your efforts to work with us and appreciate you coming here to testify and flag these issues, because you experience them more than we do — you are experiencing this every day. Do you want to... yeah. I will turn it over to my colleague.

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Yeah, I guess this is partly a comment. It is a game of whack-a-mole. We close a shop down and it opens a few blocks away, sometimes in the same location.

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Yeah, it is just like we get the sheriffs and NYPD and others involved in shutting them down, but they keep... like I said, it is like a game of whack-a-mole. Do you have any suggestions on how to deal with that?

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I think if the City does the due diligence to shut a shop down, it becomes the responsibility of the owner of that building to ensure that an illicit shop does not open in that space, because you have been warned. Most owners recognize it — they know what is going on. If the City shuts a business and six months later that business is allowed to open again,

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there has to be some accountability on the owners as well.

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I would love to piggyback on what Paul said about having to do enforcement on his own. In many ways, through investigation, we have seen a lot of this. I personally worked with many licensed operators across the city to get these illicit dispensaries — some licensed for tobacco and vape, some not — shut down. But yes, there have been instances where the operators of those illicit shops have gone into legal dispensaries and threatened the licensees. This has actually happened. They should not have to do policing on their own. One of the things that happens when a tobacco or hemp shop is inspected and sealed is that they reopen by transferring that license or getting another license for tobacco or anything cannabis-related in that same location through a family member, and they are really open the next day in many cases. It is legal and then the sheriff's office and all of the enforcement authorities are notified. They have to come back together and do it all over again and again and again. This is one of the reasons it is whack-a-mole.

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Yes, landlord accountability. This is another reason.

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It is whack-a-mole because the landlords have really nothing to lose. These spaces are giving them much more money than licensed establishments can afford, and they are giving it to them in cash in many cases and there is no accountability. There was an initiative to hold landlords accountable. It has not been enforced at all.

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I have not heard of one landlord actually receiving any penalty beyond a warning letter, and they just keep doing it.

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All right, thank you. Thank you to this panel for coming to testify and taking the time and making really helpful suggestions. Thank you all. Next panel, we will have Fernando, Lynn and Christopher Leon Johnson. And if people are here to testify,

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please sign up. Good afternoon. My name is Fernando Landoff. I am here on behalf of... and 120 Union, Brooklyn, New York. I am a proud licensee of not only a cannabis retail license but I am also a private chauffeur with a New York City Taxi and Limousine license and a New York State driver's license. Now I cannot carry a gun with this license, but I can drive. I think we would love for you all to really take care of this problem because I got this license as a convicted felon to do the right thing. I do not see how some shop can open up today and do the same thing that I spent 30 years of my life sacrificing for, and now that it is legal it is putting me at risk.

I want to touch on a point about the tobacco issue. One of the issues the City is having is that you have to let us consume this product, just like a bar does, because a lot of families and a lot of people out there are getting tired of having to smoke in the street, which is becoming a nuisance and that is how these illicit operators got away with these kinds of things. I am not here to be a cop. I am here to support good Council Members in the State of New York for the license that I was authorized.

I was not intending on speaking, but I want to piggyback off my partners here because it is a big nuisance and it is putting us at risk, not only as business owners but it is putting the consumer at risk. Like I said, as a car driver, I do a U-turn and I get a hundred dollar ticket which I have to go pay for. Why is it that if you have a license to sell cannabis you can still do so illegally? I signed up for this license to have the opportunity to sell cannabis because I am an expert at it. I do not see how the corner store bodega has access to the same kind of product, and that should... thank you. Thank you. I think there should really be serious consequences. Appreciate it.

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Supporting our Bill. That is why we introduced it. Because we need to do this.

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Thank you.

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Chair Aldebol and Epstein, my name is Christopher Leon Johnson. I support your Bill Int 0813-2026, but I did think the City Council needed to really call this stuff out. The problem is that all the thugs are mostly African American, and we are in a city where if you call out African American clownery you get called a racist. Now I know that the chief sponsor is a white guy and this might get a lot of blowback because of the fact that a white guy introduced the Bill that addresses a Black crime problem in this city, New York. The thing is that we have a city that is controlled by these nonprofits that empower the Black crime in the city, and this is part of it — the illegal smoke shops. What goes on is that these illegal smoke shops are run by thugs, or run by people completely gaming jobs, and this is why the City Council is silent.

Going forward, the City Council needs to make sure that community boards are protected because I get it from a lot of community board chairs — they tell me that they get threatened by these guys and gals who open up because it is affecting their business. So I will say this right now: this Bill is needed, but they need to start working with the commissioner of the New York City Department to really start cracking down on the shops and getting it stopped. The whole problem in New York City is that we are so obligated to protecting thugs and gang bangers and giving opportunities to these gang bangers more than really punishing them for being gang bangers and thugs. So what I said is right now that this Bill is needed and we have to get this race stuff out of the way. That is the only way the City goes forward with this mitigation of the smoke shop problem in the City. You have got to start calling out what is really happening here.

We have a drug problem in New York City. We have a Black crime problem in New York City, and I am saying right now that tomorrow you are going to see that kind of activity out there and they are the ones that usually go to smoke shops and buy stuff. The need is to go forward and protect the legal smoke shop owners from these people instead of protecting them for being thugs and criminals. That is when you start going forward in the City. I support this 100%. That is what I have got to say. Thank you so much.

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Thank you. Thank you very much. I am looking for Ramona... are you there? Oh, okay, good. And I am bringing up Cosmo as our last witness. You made it under the wire, you know. Okay, they are like, get over here, you know.

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I just want to say thank you for allowing me to speak here and testify in front of you. My name is Cosmo... I am with the Cannabis Retail Association of New York. We represent around 50 retailers across the state of New York right now. I am in District 1, but I have also lived in District 3 downtown. What I wanted to do is support this Bill just because it does not make sense — the amount of work that we had to put in to obtain our license and for someone to skip the line that easily.

The Marijuana Taxation Law was passed in March 2021 and I was one of the first people that got a license. I was not able to open until October 2023 — two and a half years of paying rent, paying for construction, having places that needed to meet the qualifications. So for anyone to skip the line, I think is wrong. Under this program, I feel like the problem that they are solving is giving the chances that we have, right? Like we are getting a real second chance operating in the streets legally. I came from a legacy past, but I am also coming from operating a business, which I still operate today. They combined these to qualify, right? You needed a profitable business for at least two years and then you also needed to have a conviction for cannabis.

I was stopped for cannabis dozens of times by NYPD, just for having small amounts, joints, spending nights and days, violating parole and probation and all this stuff that I had to go through in the system — and all of that for 17 years, right? Just because of a bag. Now that I can sell legally, I feel like that was the purpose of this, right? The purpose of putting this Bill into place is to give back to the people who have been most impacted and give them a real second chance, because what they did was really wrong. So for people that are now operating off the grid and doing crazy stuff, I think there needs to be some sort of regulation. I definitely support this Bill.

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Thank you. And we just heard earlier some suggestions around expanding the power to happen with other licenses where you think that people might be able to get licenses that they would otherwise use for illegal cannabis. Is that something we should be thinking about?

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There is also a misconception and a lack of communication in terms of store owners not knowing what type of license they have. I think there is an issue with that. I go to a store and the owner is like, "Yeah, I have a license to do this," and I am like, "Yeah, that is a CBD license" — it says CBD on the package. So I point that out and he is like, "Yeah, but it is coming from New York." I am like, "No," you know. So the lack of education is something that needs to be addressed. But again, in terms of the vape category, I do not know — there is just no regulation, right? I mean, I have got places that are 200 feet away from me doing whatever they want to do. And then when you call the marshals, they do not get shut down.

I mean, they have been inspected. I do not even have to call. They have been jumping in there inspecting them. We see it when they get inspected, but they never get caught, because they find different ways around the regulations, right? So there is always like a chess game being played. People are being raided at off hours, right? And they say that in court and then their cases just get dismissed, right? Because their hours of operations say something on Google and they use that as a testimonial saying, "Hey, they raided me at 8 a.m. but my hours of operation are 10 a.m., so I am not being raided, just inspected." So it is always a catch-22. It is going to be, you know, a constant game.

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Yeah, well, I think we can do the best we can to do more enforcement and provide more tools, and unfortunately people are going to try to evade the law.

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And yeah, I do not want to go back to locking people up and all this stuff, but I think there needs to be more education on what steps we took in order to do what we are doing now. Yeah. Or maybe more real teeth against the property owner or additional... I do not know how

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we can levy more punishments against someone if they know this is happening illegally. I mean, it is easy for them to get away with it. Yeah. All right. I do not have any questions. Do you? Thank you.

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The hearing is still going. Hold up.

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Ah, yes. Roland Connor. Good, how are you? You cannot drive down here — it is like, you know, the next two days it is impossible, you know? Yeah, take the subway. And what is your name, ma'am? Are you testifying too, Patricia Connor? Are you going to testify as well, Connor? Yeah. Okay, so just need to fill out a form, but go ahead and speak. You can both go, but they will give you a form to fill out.

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Nowhere. Okay.

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Okay, so where we were — we just held up. We are almost done. We are just waiting for you. Guys, one way to increase the pressure on... yeah. Sorry about that, it is Mars's fault. Blame

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her. Okay, so my name is Roland Connor. We are part of Smack Village. We were one of the first social equity license holders — one of the first people to get a social equity license. We have been open...

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Congratulations. Thank you.

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We have been open since 2023. Thank God we are still here. It has been challenging to say the least, as far as the illicit market and enforcement go. We did see a situation where they actually did do enforcement and we actually saw our sales go up the same day they did it. They just never really kept the pressure up in Manhattan.

I think, you know, putting this Bill forward to actually make sure that these tobacco-holding smoke shops are actually penalized for cannabis... the reason why I got the license is because I was doing something wrong at one point and New York City decided to say, "You know what, those people who were penalized back then can be the first ones to get this license as long as they do things the right way." What I have noticed in the industry at this point is that a lot of people are not held to that same standard. We are doing everything that we are supposed to do, but there are too many people who are just breaking the law and not paying taxes. These are all the things that we did and we paid the price for it, justifiably so. But at the same time, we have now seen that it is almost better not to do things the right way at this point, when it comes down to people being able to skirt the law and not pay cannabis taxes.

We have some of the strangest rules and regulations that we have to follow, on top of the 280E taxes that have to be paid, and that is not really being... that is being celebrated as far as the money that is being generated for the City. But at the same time, for us being the foundation of that money that is being generated for the City, we should be protected when it comes down to being in a place doing things the right way and making sure that the stores or other competition around us are not skirting the law. We got this license for a reason. We have to do it the right way. Everyone should be held to the same criteria. So I just want to put that out

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there. Yeah, I would like to add to that. Along with the illicit stores, we

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are, especially in our area, also in competition with the park. Washington Square Park is very well known, especially for the students, for unlicensed sales. We noticed a huge uptick on 4/20 because the police shut down that park and all those people came to our store because we were the closest. I realized then that our competition is not just the stores that are in our area, but it is also that park. I do not know how to even justify getting the cops over there to shut down that park, but it has to be done. It needs to be done, especially to protect the stores that surround that area.

As far as our finances are concerned, the illicit stores have gotten very savvy. They know to open up at certain hours. A lot of times our staff stayed late and they would circle around and get pictures. Now they are opening around 8 o'clock at night or 7 o'clock at night, as opposed to staying open every day all day. So they have gotten very savvy. From what we see, it looks like they are closed, but they are really not. Those are the smoke shops — they know how to time it at this point.

When it comes down to our location, right around the corner right now there is a smoke shop that has their sign up, they have lights, and the thing is that this is a heavy tourist area. So they are taking advantage of tourists who do not know the difference between a licensed dispensary and an illegal one. A lot of people do not even know the difference. So there is not a lot of education when it comes down to educating the population about the differences between legal dispensaries and illegal ones.

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So this Bill to actually make sure that they are penalized is the first step of many, I believe. I appreciate both of your testimony. If you have locations that are illegal that are near you — I actually represent that area, so it is in my district — please share with me. I would love to get that information and work with the Sheriff's Department to try to do other things around closing down illegal establishments. I think that is our responsibility to support the legal market. Some people know I was a big sponsor of the Bill when we passed it in Albany and worked hard the years we were up there to get it passed. The illegal market just undermines the entire thing. So I am 100% with you. That is why I introduced the Bill and why we are having the hearing. Any other suggestions you have about how we can support the legal market, I am fully on board. Thank you so much.

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Thank you. Thank you. No, I

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do not know if the other council members have any more questions.

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Yeah, I guess I will ask the same question in a different way because you mentioned this is a good first step. What other steps do you think can be taken to stop illegal shops from operating this way? Because it just feels like we shut down a shop and it pops up again under a different name. I mean, it is just like — I was referring to it as a game of whack-a-mole. You shut one down and tomorrow it opens right back up. That is it. I do believe

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that the landlord should be

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held responsible. I think the

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landlord knows what is going on. They know who is in their space and they know what is going on. I think that not only should the actual business be held liable, but the landlord should be too, because they are taking part.

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They are partaking in a whole scheme because they want their rent — that is all they care about. If there is illegal activity going on downstairs, they could not care less. I have seen that. So I think

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that part of it is the landlord being held responsible for having illegal activity going on in their building. Also the response time — we have made a lot of complaints about different stores and it just goes unanswered. A lot of times we send stuff out and they just do not respond in time. Again, to the point where if we go around McDougal, I think it

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is blatant. Look again — yes, they have a whole store that looks like a dispensary, flowers out front. I mean, they have even better signage than we have.

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You know, because there are rules when it comes down to legal dispensaries, and they are just blatantly out there doing it and taking advantage of it. The fact that they are doing it in such a bold way

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shows that the enforcement and the time to do what is needed is lagging. So

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there is one in particular that I constantly report. It is literally across the street

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from a school. Literally, it is across the street from an elementary school at that.

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And I have reported it so many times. I have sent pictures. Nothing has been done. I do not even get a response. You report to him?

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Yes.

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Hey, could you send it to us too in the reports? Because we can follow up with them. Also follow up with the Sheriff's Department and try to enforce them. Okay, I appreciate that.

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And this last point — it really helps us out a lot when they did enforcement last time. I could not believe it. It just changed things. Sales spiked, you know, the same day or the next day. So when they do do enforcement, it does work. I just did not understand why they stopped with the enforcement.

And everything affects everything. With us, if we are not generating the sales, then we cannot keep our employees. If our sales are down, our payroll can only go so far. So we had to let about four people go because our sales dropped so drastically. I mean, it affects everything — even tax revenues. I do not want to make this long and drawn out, but one thing does affect everything else. So if we can just deal with that, I think that would help us out tremendously. Thank you.

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Thank you very much for testifying today. Appreciate it. Thank you. Hearing no more witnesses, this hearing is adjourned. Thanks again.