On a recent Sunday afternoon, Austin Garza, a tourist from Dallas, stopped by the flagship store of Weed World Candies in Midtown Manhattan and bought two pre-rolled joints.
Outside, he opened a yellow tube labeled Super Silver Haze. He took out a joint to smoke and offered puffs to passers-by, three of whom obliged.
The store opened in 2019 and had been an outlier among the pizza parlors, novelty shops and officer towers on Seventh Avenue between Times Square and Penn Station. But in recent months, several more smoke shops and dispensaries have sprung up on the same strip, illegally selling cannabis products to tourists, city dwellers and commuters.
The sleek dispensaries and tacky bodegas are part of an explosion of unlicensed cannabis shops that have opened in New York over the past year as part of a rush to cash in on the state’s legalization of cannabis.
Now on the eve of the launch of the state’s legal market, the authorities face growing pressure to address the shops, which have created confusion among everyone from tourists to police officers.
State regulators and some industry insiders have called for the shops to be shut down for fear they undermine the legal market. The urgency to face the question rose on Monday with the issuing of the first retail licenses for recreational cannabis to 36 businesses and nonprofits. State officials have said they hope to have the first retail sales underway by the end of the year.
Without a significant change in the landscape, the newly licensed sellers will be forced into competition with unlicensed stores that already have a foothold in the market.
In the city, the Adams administration has been reluctant to treat the illegal shops with a heavy hand. Kayla Mamelak, a spokeswoman for the mayor, said the city sheriff’s office, a small civil law enforcement agency, has conducted hundreds of business inspections, during which deputies confiscated illegal products, issued fines and made arrests. “Mayor Adams has been clear that no illegal business operations should be tolerated,” she said.
City authorities have sought to avoid stirring memories of the war on drugs with widespread arrests, said Jeffrey Hoffman, a cannabis lawyer and legalization activist.
“We’ve hit the reset button,” Mr. Hoffman said. “The issue just became how long they were going to let it go.”
More About Cannabis
With recreational marijuana becoming legal in several states, cannabis products are becoming more easily available and increasingly varied.
- Marijuana Pardons: President Biden pardoned thousands of people convicted of marijuana possession under federal law and said his administration would review how the drug is legally categorized.
- High Times: New York took a significant step toward launching a legal market for recreational cannabis by approving the first licenses to operate retail dispensaries in the state.
- Combating ‘Cannaphobia’: Dasheeda Dawson, New York City’s first cannabis director, has been tasked with building up new cannabis businesses and absorbing the illegal market into the legitimate one.
- Use on the Rise: Federal survey data on substance use shows the growing mainstream acceptance of cannabis and hallucinogenic compounds among young adults.
Supporters of the unlicensed shops say they are employing people and serving a clientele left waiting for legal retail locations that have been slow to launch. New York legalized cannabis last year in March.
Since legalization, cannabis shops have surfaced nearly everywhere: two blocks from a police precinct station house in Long Island City, across an intersection from a middle school in Harlem and on top of a subway station in Williamsburg, for example.
Regulators said they were tracking the shops across the state, but refused to estimate how many exist. Industry observers say they appear to number in the hundreds.
“Everybody’s doing what they got to do to get in the market,” Mel Rivera explained from behind the counter at Smoker’s World, which opened in February in Midtown.
At Weed World, a large acrylic sign advertises strains of indicas and sativas whose quirky names are written in neon colors, along with the letters “THC,” shorthand for tetrahydrocannabinol, the intoxicating compound in cannabis.
However, the owner, Bilal Muhammad, maintains that his business, unlike some newcomers, has only ever sold products made with cannabidiol, or CBD, which comes from the same plant as THC but does not get consumers high, he said.
Yet, CBD and THC both require separate licenses to sell, and Weed World had neither, Mr. Muhammad said. But he criticized the authorities for lumping his company in with sellers hawking potent THC products.
Over the summer, the city seized more than a dozen of his colorful trucks. Most of the vehicles were returned after he made arrangements to pay down $670,000 in fines for parking and health code violations, according to Mr. Muhammad. The trucks are in storage in New Jersey, he said.
Smoke shops are not the only places that have popped up selling cannabis. State regulators have also cited a tattoo parlor, an opera house and a beauty salon.
But the smoke shops are particularly concerning, regulators have said, because they give consumers the impression that they are legitimate when in reality they are operating without official oversight.
New York requires all weed sold in the state to have been grown, processed and tested within its borders, a supply chain known as seed-to-sale. But most weed shops in the city sell products in packaging with a California stamp, and some also offer illegal drugs as well as candies and elixirs made with psychedelic mushrooms.
State Senator Brad Hoylman, a Manhattan Democrat, wrote a letter to Mayor Eric Adams in September expressing concern after more than two dozen unlicensed shops opened in his district.
“I can’t tell my constituents that these products are safe, or they’re not being sold to minors,” Mr. Hoylman said.
On top of that, he added, the shops undermine lawmakers’ intention to prioritize people convicted of marijuana offenses for opportunities in the cannabis industry. The illegal shops also skirt taxes that are meant to fund addiction services, education and reinvestment in communities where enforcement was concentrated.
Julia Deviatkina closed Freaky Dog, a smoking lounge in Brooklyn, after the state published her name and address in a cease-and-desist letter.
“It was unsafe,” she said.
Even with the uncertainty surrounding unregulated sellers, Paula Collins, a lawyer who represents smoke shop and convenience store owners who sell cannabis, said that closing them down would be a mistake.
Closing stores would mean layoffs for thousands of workers, she said. And it would punish owners who have helped to normalize cannabis and buoy the commercial real estate market, she added.
Instead of cracking down on the shops, Ms. Collins said the state should try legitimizing them.
“We have all these shops popping up, everybody’s concerned, and at the same time, we’re missing out on all of this good tax revenue,” she said.
State lawmakers have said they aim to absorb the illegal market into the regulated industry. But regulators have repeatedly warned that all unlicensed cannabis sales are illegal, no matter if the cannabis product is gifted following a “donation,” or if the exchange is couched with the purchase of a membership or service.
But some businesses shrugged off the warnings, citing what they perceived as gray areas in the law and a lack of enforcement.
The Empire Cannabis Club, a nonprofit based in New York City, describes itself as a concierge service that acquires cannabis on behalf of its members.
Steve Zissou, Empire’s lawyer, said the business model is based on provisions in the legalization law that he interprets as permitting social clubs.
“It’s a legitimate outfit set up under the law as it exists,” Mr. Zissou said. “Don’t you think if they could shut it down, that they would’ve already?”
Mayor Adams, asked about stores at an unrelated news conference last month, said the city’s hands were tied because the law had not caught up to reality. “A police officer can’t just walk in and conduct an apprehension, or an arrest, or confiscate the item,” he added.
The Police Department explained in an email to The New York Times that, in its view, the legalization law does not give officers the authority to make seizures or arrests when they see cannabis displayed or to shut down unlicensed shops.
“The law only provides an enforcement mechanism if an actual sale is observed,” its public-information office said.
Chris Alexander, the executive director of the Office of Cannabis Management, said that is a persistent misapprehension among local law enforcement.
State law makes it a crime to possess more than three ounces of cannabis or to sell any amount of it. Punishments range from $125 fines to 15-year prison sentences. And some of the same municipal regulations — such as those governing the sale of food, smoking products and worker protections — that allowed the city to go after trucks, can be used against storefronts, Mr. Alexander said.
“For an average beat cop who knows that we legalized, he sees stuff happening and he’s like, ‘Well, I don’t know if that’s regulated or not but I know they legalized, so I think that there is less of a role for me,’” Mr. Alexander said.
The winds may be shifting. Police and sheriff’s deputies conducted raids earlier this month at a cannabis dispensary in Bay Ridge and a smoke shop in Greenwich Village. Investigators arrested one man on felony cannabis possession charges, seized over 200 pounds of illegal tobacco and weed, and levied $8,000 in fines, Sheriff Anthony Miranda’s office said.
But Lance Lazzaro, a criminal defense lawyer, said that his experience handling three similar cases made him confident the charges would be dismissed in court.
“It’s marijuana,” he said. “It’s not the crime of the century.”