The state of New York announced the distribution of $5 million in "Community Reinvestment Grants". The funds, derived from taxes on legal cannabis sales, will be allocated to 50 nonprofit organizations. This marks the first round of cannabis grants in New York focused on social reinvestment.

The Cannabis Advisory Board (CAB) issued the first batch of $100,000 grants. The initiative comes over four years after the signing of the Marijuana Regulation and Taxation Act (MRTA) in March 2021.

Under the program, 40% of taxes collected from legal cannabis are to be reinvested. The destination is the Community Grants Reinvestment Fund, focused on areas impacted by the former prohibition.

The initial grants will fund organizations serving youth up to 24 years old. The three priority areas are: mental health, workforce development, and housing.

Eligible organizations do not need ties to cannabis companies but must operate in counties with high youth service needs. These areas have also historically been subject to excessive policing.

Beneficiaries will receive funding over two years. A portion will be paid upfront, with the remainder distributed quarterly.

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Rising revenue drives future grants

Legal sales are on the rise. Recent reports show that August hit a record $214.4 million, bringing the year's total to $1.26 billion. Cumulative sales have reached $2.3 billion since December 2022. This growth is partly driven by state actions against the illicit market.

Following the closure of over 1,000 illegal retail points, legal stores in New York City saw a 72% sales increase. This indicates a successful redirection of consumers to the regulated market.

Selection and next steps

With cannabis tax revenues stabilizing, CAB aims to expand funding. Broader community initiatives are expected to be included in future rounds.

The current 50 beneficiaries were selected from 451 applications. The funded programs range from mental health and housing to education, arts, and agriculture.

With information from Businessofcannabis