Amd §§71, 72 & 3, Cannabis L; amd §§63, 3, 105 & 102, add §63-b, ABC L; amd §493, Tax L; amd §99-ii, St Fin L
Authorizes the issuance of a low potency cannabis beverage retail permit to licensed off-premises liquor and wine stores to allow the regulated sale of low potency cannabis single use beverages that contain no more than 5mg of THC manufactured by New York state adult-use licensees; provides for the allocation of low potency cannabis beverage tax revenue in the New York state cannabis revenue fund.
STATE OF NEW YORK
________________________________________________________________________
9220
IN SENATE
February 17, 2026
___________
Introduced by Sen. COONEY -- read twice and ordered printed, and when
printed to be committed to the Committee on Investigations and Govern-
ment Operations
AN ACT to amend the cannabis law and the alcoholic beverage control law,
in relation to the issuance of a low potency cannabis beverage retail
permit; to amend the tax law, in relation to the imposition of tax on
the sale or transfer of certain low potency cannabis beverages; and to
amend the state finance law, in relation to the allocation of low
potency cannabis beverage tax revenue in the New York state cannabis
revenue fund
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Subdivision 1 of section 71 of the cannabis law is amended
2 to read as follows:
3 1. A distributor's license shall authorize the acquisition,
4 possession, distribution and sale of cannabis from the licensed premises
5 of a licensed adult-use cultivator, processor, adult-use cooperative,
6 microbusiness, or registered organization authorized pursuant to this
7 chapter to sell adult-use cannabis, to duly licensed retail
8 dispensaries, businesses licensed under section sixty-three of the alco-
9 holic beverage control law, and on-site consumption sites.
10 § 2. Subdivision 1 of section 72 of the cannabis law is amended to
11 read as follows:
12 1. Except as otherwise provided in section sixty-three-b of the alco-
13 holic beverage control law, no person shall sell cannabis at retail
14 without a retail dispensary license. A retail dispensary license shall
15 authorize the acquisition, possession, sale and delivery of cannabis
16 from the licensed premises of the retail dispensary by such licensee to
17 cannabis consumers.
18 § 3. Section 3 of the cannabis law is amended by adding a new subdivi-
19 sion 56 to read as follows:
20 56. "Low potency cannabis beverage" means a single-use beverage
21 container that contains no more than five milligrams of total THC.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD14705-01-6
S. 9220 2
1 § 4. Subdivisions 1 and 4 of section 63 of the alcoholic beverage
2 control law, subdivision 1 as amended by section 3 of part K of chapter
3 60 of the laws of 2004 and subdivision 4 as amended by chapter 24 of the
4 laws of 2024, are amended to read as follows:
5 1. Any person may make an application to the appropriate board for a
6 seven day license to sell liquor or low potency cannabis beverages at
7 retail not to be consumed upon the premises where sold. Such application
8 shall be in such form and shall contain such information as shall be
9 required by the rules of the liquor authority and shall be accompanied
10 by a check or draft in the amount required by this article for such
11 license.
12 4. No licensee under this section shall be engaged in any other busi-
13 ness on the licensed premises. The sale of lottery tickets, when duly
14 authorized and lawfully conducted, the sale of reusable bags as defined
15 in section 27-2801 of the environmental conservation law, the sale of
16 corkscrews or the sale of ice or the sale of publications, including
17 prerecorded video and/or audio cassette tapes, or educational seminars,
18 designed to help educate consumers in their knowledge and appreciation
19 of alcoholic beverages, as defined in section three of this chapter and
20 allowed pursuant to their license, or the sale of non-carbonated, non-
21 flavored mineral waters, spring waters and drinking waters or the sale
22 of glasses designed for the consumption of wine or liquor, racks
23 designed for the storage of wine, and devices designed to minimize
24 oxidation in bottles of wine which have been uncorked, low potency
25 cannabis beverages as defined in subdivision thirty-nine of section
26 three of this chapter, or the sale of gift bags, gift boxes, associated
27 gift or promotional items, or wrapping, for alcoholic beverages
28 purchased at the licensed premises shall not constitute engaging in
29 another business within the meaning of this subdivision. Any fee
30 obtained from the sale of an educational seminar shall not be considered
31 as a fee for any tasting that may be offered during an educational semi-
32 nar, provided that such tastings are available to persons who have not
33 paid to attend the seminar and all tastings are conducted in accordance
34 with section sixty-three-a of this article. For the purposes of this
35 section, gift or promotional items shall only include those items that
36 are complimentary and directly associated with the sale of wine or
37 liquor they are promoting and shall mean: (i) items that are de minimis
38 in value, but in no instance shall merchandise be valued at more than
39 fifteen dollars in total; (ii) items that are imprinted with the wine or
40 liquor brand logo on the gift or promotional item; and (iii) items that
41 are included as part of a manufactured pre-sealed package with the wine
42 or liquor that is being gifted or promoted. Further, for the purposes of
43 this section, promotional items shall not include any food, non-alcohol-
44 ic beverage, or other drink or food mix, nor shall these items be
45 offered for sale to the general public as individual items.
46 § 5. The alcoholic beverage control law is amended by adding a new
47 section 63-b to read as follows:
48 § 63-b. Low potency cannabis beverage retail permit. 1. The authority
49 is hereby authorized to issue a cannabis beverage retail permit to the
50 holder of a license to sell liquor at retail for consumption off the
51 premises pursuant to section sixty-three of this article.
52 2. Such permit shall authorize the permittee to sell low potency
53 cannabis beverages, as defined in subdivision fifty-six of section three
54 of the cannabis law, at retail for off-premises consumption.
S. 9220 3
1 3. (a) The annual fee for such permit shall be determined by the
2 authority, provided that such fee shall be commensurate with the admin-
3 istrative costs of issuing and overseeing such permit.
4 (b) Such permit shall run concurrently with the underlying retail
5 license and shall be renewed at the same time as such license.
6 (c) The revocation, suspension, or cancellation of the underlying
7 retail license shall automatically result in the same for the permit
8 issued under this section.
9 4. All low potency cannabis beverages shall be maintained in a sepa-
10 rate and distinct area of the licensed premises from alcoholic beverag-
11 es, clearly marked by signage as required by the authority.
12 5. Low potency cannabis beverage retail permittees shall maintain
13 inventory records of all low potency cannabis beverages acquired, in the
14 possession of the permittee, and sold using a software system determined
15 by the office of cannabis management.
16 6. The authority and the office of cannabis management shall enter
17 into a memorandum of understanding to coordinate the inspection and
18 enforcement of provisions relating to this endorsement.
19 7. (a) No permittee under this section shall sell, deliver, or give
20 away, or cause or permit or procure to be sold, delivered, or given away
21 any low potency cannabis beverage to any person, actually or apparently,
22 under the age of twenty-one years.
23 (b) It shall be an affirmative defense that such person had produced a
24 photographic identification card issued by a governmental entity and
25 that the beverage had been sold in reasonable reliance upon such iden-
26 tification, as provided in section sixty-five-b of this article.
27 8. A violation of the age restrictions set forth in this section shall
28 be deemed a violation of section sixty-five of this article for the
29 purposes of administrative proceedings to revoke, cancel, or suspend the
30 underlying retail license.
31 § 6. Section 3 of the alcoholic beverage control law is amended by
32 adding a new subdivision 39 to read as follows:
33 39. "Low potency cannabis beverage" means a single-use beverage
34 container manufactured at a premise licensed under article four of the
35 cannabis law that contains no more than five milligrams of total THC as
36 defined under section three of the cannabis law.
37 § 7. Subdivision 16 of section 105 of the alcoholic beverage control
38 law, as amended by chapter 621 of the laws of 1944, is amended to read
39 as follows:
40 16. No retail licensee to sell liquors and/or wines for off-premises
41 consumption shall be interested, directly or indirectly, in any premises
42 where liquors, cannabis, wines or beer are manufactured or sold at
43 wholesale or any other premises where liquor or wine is sold at retail
44 for off-premises consumption, by stock ownership, interlocking direc-
45 tors, mortgage or lien on any personal or real property or by any other
46 means. Any lien, mortgage or other interest or estate, however, now
47 held by such retailer on or in the personal or real property of such
48 manufacturer or wholesaler, which mortgage, lien, interest or estate was
49 acquired on or before December thirty-first, nineteen hundred thirty-
50 two, shall not be included within the provisions of this subdivision;
51 provided, however, the burden of establishing the time of the accrual of
52 the interest comprehended by this subdivision, shall be upon the person
53 who claims to be entitled to the protection and exemption afforded here-
54 by.
S. 9220 4
1 § 8. Subdivision 8 of section 102 of the alcoholic beverage control
2 law, as added by chapter 92 of the laws of 2021, is amended to read as
3 follows:
4 8. [No] With the exception of low potency cannabis beverages, no alco-
5 holic beverage retail licensee shall sell cannabis, as defined in
6 section three of the cannabis law, nor have or possess a license or
7 permit to sell cannabis, on the same premises where alcoholic beverages
8 are sold.
9 § 9. Subdivision (c) of section 493 of the tax law, as added by chap-
10 ter 92 of the laws of 2021, is amended to read as follows:
11 (c) (i) In addition to the taxes imposed by subdivisions (a) and (b)
12 of this section, there is hereby imposed a tax on the sale or transfer
13 of adult-use cannabis products to a retail customer by a person who
14 sells adult-use cannabis products at retail at the rate of four percent
15 of the amount charged by such person for such adult-use cannabis prod-
16 uct, which tax shall accrue at the time of such sale or transfer. The
17 tax imposed by this subdivision is imposed on a person who sells adult-
18 use cannabis products at retail, and shall be paid to the commissioner
19 in trust for and on account of a city having a population of a million
20 or more, and counties (other than counties wholly within such a city),
21 towns, villages, and cities with a population of less than a million in
22 which a retail dispensary is located.
23 (ii) There is hereby imposed a tax on the sale or transfer of low
24 potency cannabis beverages by a distributor to a person holding a canna-
25 bis beverage retail permit under section sixty-three-b of the alcoholic
26 beverage control law at the rate of nine percent of the amount charged
27 for such sale or transfer.
28 (iii) There is hereby imposed a tax on the retail sale of low potency
29 cannabis beverages by a permittee under section sixty-three-b of the
30 alcoholic beverage control law to a consumer at the rate of thirteen
31 percent of the amount charged for such sale.
32 § 10. Section 99-ii of the state finance law is amended by adding a
33 new subdivision 3-a to read as follows:
34 3-a. Notwithstanding any other provision of law, the revenues derived
35 from the thirteen percent retail tax on low potency cannabis beverages
36 shall be distributed as follows:
37 (a) One percent to the state liquor authority for the costs of imple-
38 mentation, administration, and enforcement of the cannabis beverage
39 retail permit;
40 (b) Two percent to the cannabis revenue fund, to be administered by
41 the office of cannabis management, for the specific purpose of providing
42 loans, grants, and technical assistance to small businesses and social
43 and economic equity applicants;
44 (c) Two percent to the cannabis revenue fund to be used by the office
45 of cannabis management for trade practice oversight and the enforcement
46 of laws against the illicit sale of cannabis;
47 (d) Four percent to be distributed to the local municipality in which
48 the sale occurred; and
49 (e) Four percent to the New York state cannabis revenue fund for
50 general purposes as set forth in this section.
51 § 11. The opening paragraph of subdivision 4 of section 99-ii of the
52 state finance law, as added by chapter 92 of the laws of 2021, is
53 amended to read as follows:
54 After the dispersal of moneys pursuant to [subdivision] subdivisions
55 three and three-a of this section, the remaining moneys in the fund
56 deposited during the prior fiscal year shall be disbursed into the state
S. 9220 5
1 lottery fund and two additional sub-funds created within the cannabis
2 revenue fund known as the drug treatment and public education fund and
3 the community grants reinvestment fund, as follows:
4 § 12. This act shall take effect on the one hundred eightieth day
5 after it shall have become a law. Effective immediately, the addition,
6 amendment and/or repeal of any rule or regulation necessary for the
7 implementation of this act on its effective date are authorized to be
8 made and completed on or before such effective date.
