Town of Ulster mulls cannabis dispensaries

The Town of Ulster held a public hearing on October 21 on whether to allow retail dispensary and on-site cannabis consumption lounges within municipal boundaries following the statewide adoption earlier of the Marijuana Regulation & Taxation Act. Only four people spoke, all in favor of not opting out. 

“Recent New York state law changes allow the town to regulate and permit distribution for retail outlets and also regulate and permit public consumption in a lounge setting,” said Town Supervisor James E. Quigley III during the October 21 public hearing. “It is the Town Board’s consensus that this is such an important decision, we need public input. We have not made up our mind where we want to go. We would like to hear from the citizens in the community as to how they feel about it.”

The issue was first discussed by councilmen during a Town Board meeting held on Thursday, September 2. Town Attorney Jason Kovacs explained that while the New York State Cannabis Board will issue a range of licenses for cultivators, processors and distributors of legal marijuana, municipalities like Ulster have greater local control over retail dispensaries and on-site consumption businesses. Local governments have until December 31 to opt out — that is, not permit such businesses within its boundaries. 


“If the town doesn’t take any action by the end of this year and pass a local law opting out of the scheme…the cannabis control board will or may issue licenses for those two types of entities in the Town of Ulster,” Kovacs said in September. 

Kovacs added that opting out would cause the town to forfeit potential sales tax revenue from businesses that could have been established within Ulster; the state law includes a 13 percent sales tax on marijuana sales, with four percent split between the county and municipality. He added that not opting out wouldn’t mean the town was powerless about how and where marijuana businesses could exist there. 

“Any applicant before the Cannabis Control Board for either the retail dispensary license or the consumption license, they have to notify the town clerk at least 30 days before they applied to the state,” Kovacs said. “It’s very similar to the liquor license application. So the town can give the Cannabis Control Board comments on whether they think the license location is proper, whether it’s a good place, et cetera…”

Councilmen in Ulster did not state a preference during the September meeting, and they were similarly quiet during last week’s public hearing. But a member of the Town’s Zoning Board of Appeals, Kevin Reginato, was among those who spoke in favor of opting in, or at least not opting out. “I’m here today to try in hopes of convincing the board…to not opt out of allowing cannabis dispensary businesses in the Town of Ulster,” Reginato said. “I noticed when I walked in the sign here that says ‘The Hudson Valley’s Gateway to Beauty and Business.’ The beauty is a given, especially this time of year with the foliage. But the business I think we can do better. I believe that that the increase in tax revenue and job growth potential and the investment opportunities should be a powerful incentive for this Board being in favor of this (type of) business.”

Reginato cited a recent BDSA (formerly BDS Analytics, the National Cannabis Industry Association) report that showed legal cannabis sales in 2020 had hit a U.S. record of $17.5 billion, a 46 percent increase from the previous year.

“This is all during a pandemic,” Reginato said. “This business has proven to be recession-proof.”

He added that legal retailers draw business away from underground cannabis sellers, diverting it from under-age users, similar to how a liquor store operates. He listed what he saw as other benefits. “Cannabis is associated with reduced opiate consumption by the general public,” Regniato said. “It’s a safer and smarter alternative to medicine. And the dispensary clientele tend to be older and value specific strains, sort of like buying cigars or buying wine, things like that. This is becoming a very sophisticated market and I encourage everybody on this board to really do their research and just understand what’s happening with this.”

Town resident Laura Hartmann also spoke in favor of not opting out. “I think there’s a lot of money, tax revenue that we can get that this town very much needs,” Hartmann said. “Medical marijuana has transformed communities and is also transforming people’s lives.”

Reginato also noted that other local municipalities could opt in and leave the Town of Ulster out of the financial benefits. “I hate to see us be behind the curve,” Reginato said. “Because this is going to happen. It’s going to happen in the state and if it doesn’t happen here, it’s going to happen in the next town over. This is my home, this is our home. It’s important to grow business, not reject business.”

Town officials will accept written public comment for 30 days following the public hearing and will vote on whether to opt in or out of allowing cannabis dispensaries and consumption lounges before a December 31 deadline.