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S 9220

Establishes a low potency cannabis beverage retail permit

2025 Regular Session Introduced by Jeremy Cooney

Establishes a separate low potency cannabis beverage permit (max 5 mg THC) sold off-premises through alcohol licenses, with new taxes and revenue sharing.

PRINT NUMBER 9220A
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WeVote Research Nonpartisan
Bill Summary · S 9220

Summary of bill S 9220-A (2025-2026) — New York

Date introduced: February 17, 2026
Sponsor: Sen. Cooney (co-sponsor: Jeremy Cooney)

Purpose
- Establishes a legal framework for introducing a low potency cannabis beverage retail permit and related tax/fee structures.
- Creates an off-premises, low potency cannabis beverage market integrated with existing liquor and beer retail/licensing regimes.
- Allocates tax revenues from low potency cannabis beverages to various state and local programs, with emphasis on small businesses, equity initiatives, enforcement, and local distributions.

What the bill would do (major provisions)

1) Definitions and scope
- Adds a new definition: a “Low potency cannabis beverage” is a single-use beverage container containing no more than 5 milligrams of total THC (Section 3, Subdivision 56).

2) Cannabis and alcohol licensing framework
- Expands licensing overlap between alcohol and cannabis:
- A distributor’s license may acquire, possess, and distribute cannabis to licensed retail dispensaries, adult-use licensees, and certain alcohol-related licensees (Section 1).
- Retail cannabis sales remain subject to a retail dispensary license requirement (Section 2).
- A new low potency cannabis beverage retail permit is established under the alcohol licensing framework (see below).

3) Low potency cannabis beverage retail permit (new authority under the Alcoholic Beverage Control (ABC) Law)
- The ABC Authority may issue a cannabis beverage retail permit to:
- Holders of a for-off-premises liquor retail license (Article 4 of the ABC Law) and
- Holders of a beer wholesale license (Section 63 of ABC Law).
- Permitted activity: Sell low potency cannabis beverages at retail for off-premises consumption (Section 5, §63-b).
- Permit specifics:
- Annual fee to be set by the authority, commensurate with administrative costs.
- Permit runs concurrently with the underlying license and renews on the same schedule.
- If the underlying license is revoked/suspended, the cannabis permit is automatically revoked/suspended (Section 5, §63-b(3)).
- Beverages must be stored in a separate, clearly marked area from alcoholic beverages on the licensed premises (Section 5, §63-b(4)).
- Inventory must be tracked with a software system determined by the Office of Cannabis Management (OCM) (Section 5, §63-b(5)).
- Coordination between the ABC Authority and OCM for inspections/enforcement (Section 5, §63-b(6)).
- Age restrictions: No sales to or for persons under 21; affirmative defense if the purchaser shows government-issued photo ID (Section 5, §63-b(7)).
- Violations of age restrictions align with penalties related to the underlying retail license (Section 5, §63-b(8-9, 31-33)).

4) Additional ABC Law changes
- Defines “Low potency cannabis beverage” within ABC Law (Section 6, Subdivision 39).
- Clarifies existing off-premises liquor/wine licensing restrictions in light of low potency cannabis beverages (Section 8).

5) Taxation and revenue allocation (Tax Law and State Finance Law)
- New tax regime for low potency cannabis beverages:
- 4% tax on retail sales of adult-use cannabis products in jurisdictions with/without certain dispositions (existing cannabis tax structure) continues; plus a new structure for low potency beverages:
- 9% tax on the sale/transfer of low potency cannabis beverages from distributors to permittees (Section 9, §493(c)(ii)).
- 13% tax on the retail sale of low potency cannabis beverages to consumers (Section 9, §493(c)(iii)).
- Revenue distribution (State Finance Law, §99-ii):
- 1% to the NYS Liquor Authority for implementation/administration/enforcement of the cannabis beverage permit.
- 2% to the Cannabis Revenue Fund (administered by OCM) for loans, grants, and technical assistance to small businesses and equity applicants.
- 2% to the Cannabis Revenue Fund for trade practice oversight and enforcement against illicit cannabis.
- 4% to the local municipality where the sale occurs.
- 4% to the NYS Cannabis Revenue Fund for general purposes.
- The article also reorganizes remaining funds after allocations into related state funds (Section 11).

6) Effective date
- Takes effect 180 days after enactment; immediate authority to issue regulations for implementation (Section 12).

Who is affected

  • Retail licensees: Liquor off-premises retailers and beer wholesalers may obtain a new low potency cannabis beverage retail permit to sell off-premises.
  • Cannabis market participants: Distributors and licensed cannabis products must align with the new tax, recordkeeping, and separation requirements.
  • Consumers: Age 21+ restrictions for purchasing low potency cannabis beverages; limited THC per container (5 mg).
  • State agencies: NYS Liquor Authority and Office of Cannabis Management coordinate enforcement, administration, and oversight.
  • Localities: A portion of tax revenue (4%) is distributed to the local municipality hosting the sale.

Timeline and procedural notes

  • Regulation and administration: Authority to implement rules immediately upon enactment, with 180 days before full effective date.
  • Permits: Issuance and renewal aligned with underlying licenses; automatic revocation if the underlying license is suspended/revoked.

Notes for readers

  • The bill creates a distinct, low-THC beverage category and ties it to existing alcohol licensing structures, with strict age controls, inventory tracking, and cross-agency oversight.
  • Revenue allocations are designed to support implementation, equity initiatives, local municipalities, and enforcement against illicit activity.

Compiled from official sources — confirm details with the bill’s official record.

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