The state Senate's Subcommittee on Cannabis conducted its first hearing Monday on the lumbering rollout of New York's highly regulated retail marijuana industry, with dozens of regulators, law enforcement officials, and industry stakeholders using the platform to highlight their concerns.

The proliferation of illicit cannabis outlets, now estimated at around 8,000 in New York City with thousands more upstate, was a central topic at the hearing as regulators and tax officials testified that they remain steadfast in their efforts to crack down on the underground market, which has damaged the sales of the 26 licensed retail business that have opened.

"We have been working closely with (state Office of Cannabis Management) investigators, in part, because they were new to the space, and so we were able to sort of help in the development of procedures around investigations, around evidence collection, and around some of the logistics of these investigations," Amanda Hiller, commissioner of the state Department of Tax and Finance, told the panel. "And I think that that's also been a really effective partnership. Certainly, there's always more to be done."

The testimony of many of the industry's early stakeholders, including licensees whose applications are still pending, echoed the concerns they have raised at Cannabis Control Board hearings about the struggles they are facing due to the arguably bungled rollout.
Joseph Calderon, CEO of Grateful Valley Farm, said the roughly 36,000 illegal businesses in the illicit market had eroded the ability of small operators to survive. He estimated that there are still more than 300,000 pounds in unsold crops from small farms due to the insufficient number of retail outlets and with roughly 400 conditional retail license applicants "in limbo."

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