During his State of the State and budget address Tuesday, New York State Gov. Andrew Cuomo reiterated his intention to legalize adult-use cannabis in the state.

What Happened

Cuomo presented his plans for a "justice agenda" in the first 100 days of the term and reiterated plans to legalize recreational weed.

The governor said he wants to end the disproportionate impact of criminalized marijuana on communities of color and plans to use legalization as a way to "empower poor communities."

In a written message distributed to lawmakers as part of the State of State Address, Cuomo's office outlined a plan for legalization that includes establish separate licensing programs for growers, distributors and retailers.

The plan also includes a ban on growers opening retail shops and would prevent marijuana sales to anyone under 21.

Cuomo also intends to give counties and cities the option to ban marijuana sales within their boundaries.

Under his proposal, New York would impose a 20-percent state tax and 2-percent local tax on the sale of the drug from wholesalers to retailers, plus a per-gram tax on growers.

Why It's Important

With a population of almost 20 million people, New York is the fourth most-populous state — meaning the market potential for recreational marijuana is equally large.

This creates many opportunities for companies that are already operating in the state's medical marijuana industry, such as iAnthus Capital Holdings Inc (OTC: ITHUF), which owns Citiva Medical, and Medmen Enterprises Inc (OTC: MMNFF).

In his written message, Cuomo said the state could reap as much as $300 million in tax revenue from recreational marijuana.

What's Next

Cuomo's plan will be discussed in the state legislature, where it's expected to receive majority support from lawmakers.

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Photo by New York MTA via Wikimedia.