New York State Office of Cannabis Management Issues Correction on Dispensary Proximity to Schools

By Neil Willner, Brandon Kurtzman

Jul 29, 2025

The New York State Office of Cannabis Management (OCM) has issued a critical correction to its previous guidance on measuring the required 500-foot buffer between retail cannabis dispensaries and schools. This clarification has immediate and potentially far-reaching consequences for both pending applicants and currently licensed retailers across New York State.

Previous OCM Guidance on Measuring Cannabis Dispensary Distance to Schools

Long-standing OCM guidance had instructed applicants that the 500-foot measurement “will be taken in a straight line from the center of the nearest entrance of the nearest building occupied as a school, on the school grounds, to the center of the nearest entrance of the premises that the licensee wishes to locate the dispensary at. Only entrances that are regularly used to give ingress to patrons of the establishment will be used to determine distance." Moreover, this previous guidance only applied this 500-foot measurement to dispensaries that were on the same road as a school.

OCM’s Corrected Measurement: From Dispensary Entrance to School Property Line

According to OCM’s correction, this method was incorrect and inconsistent with Cannabis Law § 72(6). Under the correct legal standard, the distance must be measured as a straight line from the entrance of the dispensary to the nearest point on the property line of the school grounds, which is a significantly broader and more restrictive approach. Indeed, under this approach, a dispensary need not be on the same road as a school in order to apply the 500-foot measurement standard.

Which New York Dispensaries Are Affected by the School Distance Rule Change?

This correction has immediate and substantial implications. OCM has already identified:

47 pending applicants with proposed dispensary locations that may now be noncompliant
105 licensed dispensaries currently licensed at sites that may fall within the newly defined 500-foot boundary. As many as 60 of these dispensaries are currently operating.

While most of these locations are in New York City, impacted businesses are also located across the Capital Region, Finger Lakes, Mid-Hudson, Southern Tier, and Long Island.

OCM is in the process of notifying affected parties and continues to review applications and licenses to identify others who may be impacted.

What Pending New York Cannabis Applicants Need to Know About the New Rule

Pending applicants with non-compliant locations must now secure a new, compliant site before licensure.

OCM has confirmed that these applicants may be eligible to receive up to $250,000 in relocation and site preparation assistance through OCM’s $15 million Applicant Relief Program. OCM has also indicated that it may issue or extend provisional licenses in cases where this proximity issue is the only barrier to approval.

Impacts on Licensed Cannabis Dispensaries Already Operating in New York

The state is exploring legislative remedies for businesses already operating at locations now considered noncompliant. OCM, in coordination with the Governor’s Office, is pursuing legislation that would permit these dispensaries to remain at their current sites. However, until such legislation is enacted, the requirement to relocate remains in effect for future license renewal.

How Vicente LLP Can Support Cannabis Operators Navigating the New York OCM Update

We strongly recommend that all dispensary applicants and license holders in New York:

Reassess proximity to school grounds using the corrected measurement (entrance-to-property line)
Confirm compliance before submitting a new property for approval or renewal
Monitor notifications from OCM regarding potential noncompliance
Evaluate relocation assistance options through the Applicant Relief Program, if applicable

Vicente LLP is actively tracking OCM updates and can assist with compliance evaluations, location strategy, and relief applications. If your dispensary location may fall within 500 feet of a school property line, or if you’re unsure how this correction may affect your business, please reach out to a member of our New York team at newyork@vicentellp.com or call 917-338-5455.