Social equity programs are the most progressive approach to legalizing cannabis yet
Wherever you look, societies that choose to legalize cannabis are being lifted up. More tax revenue. Less burdened police forces. Most importantly, people have more freedom. Building on these successes, social equity programs are the most progressive approach to legalizing cannabis yet. Their goal: to guarantee the people most affected by the War on Drugs have the best shot at participating in these burgeoning industries.
Despite being used in traditional medicine for thousands of years, it took less than a century for “cannabis” to be recast from a medicine to Public Enemy Number one in the U.S. Beginning with the Mexican Revolution of 1910 and culminating with the Reefer Madness of the 30s, the cultural shifts against “marijuana” would prove to be lasting. Worse, they would become racialized and lead to minorities being incarcerated at disproportionately higher rates than whites for drug crimes. Consider, for example, that one in nine black children has a parent that is incarcerated compared to one in 57 white children. For latino children, that number is one in 28. Or that despite nearly identical rates of usage, blacks are 3.73 times more likely to be arrested for cannabis than whites.
This new age of cannabis legalization brings unprecedented opportunities. For a growing number of people, it’s the responsibility to atone for decades of inequality caused by the failed War on Drugs. That is why many states, as well as cities across California, are building social equity programs into their industries. In some form, Massachusetts, Maryland, Ohio, Pennsylvania, Florida, and California have included such provisions into their cannabis laws.
The fundamental idea of social equity programs is justice. Since drug laws have unfairly affected minority and low-income communities, their reform, in theory, should provide them restitution.
Otherwise, structural disadvantages, such as criminal convictions or the inability to obtain a business license as a result of one, could prevent them from participating at all.
Massachusetts is the first state to implement a social equity program. It is groundbreaking for many reasons, not least of which is the fact it was created by an equally novel entity - The Massachusetts Cannabis Control Commission.
Massachusetts’ social equity provisions have two main components: the Economic Empowerment Priority Review and the Social Equity Program. Essentially, Priority Review is geared to helping applicants get their foot in the door--i.e., get the licensing to operate a business--while the Social Equity Program is geared to helping keep businesses compliant and turning a profit. At the macro level, both components seek to reduce the barriers minorities face when entering the cannabis industry and promote diversity in the ownership and workforce of cannabis businesses.
The Economic Empowerment Priority Review concluded last April with 123 applications that were accepted. To have qualified for priority review, applicants must be part of or serving unfairly affected communities -- what the legislation refers to as “areas of disproportionate impact.” This is demonstrated by proving that you meet three of six criteria. The criteria focus on things like past experience empowering areas of disproportionate impact; if the businesses hire employees or contractors that have drug-related offenses; and if they are owned by people of African American or Latino descent.
Massachusetts considers equity and general applicants on a rotating basis, i.e, 1:1. To be clear, priority review doesn’t mean that an application is received and approved. Only that is accepted for consideration on that rotating basis. In fact, according to the Boston Globe, as of mid-January none of the first 99 licenses awarded in Massachusetts went to minorities.
The Social Equity program has similar criteria, such as being convicted of a drug offense or being the child or spouse of someone who has, but benefits that focus on post-licensure assistance as well. These include education and technical training in areas such as management, legal and tax compliance, and industry best practices.
On the West Coast, equity laws in California first took root in the cities. Oakland, San Francisco, Los Angeles, and Sacramento have all created social equity programs. At the State level, former Governor Jerry Brown signed the California Cannabis Equity Act last September. The law authorized 10 million dollars of funding for existing or future municipal programs. This was crucial. Despite their best intentions, social equity programs are widely perceived as failing in California and elsewhere.
In Los Angeles, for example, cannabis attorneys are worried the regulatory scheme is rife with predatory opportunities. Among them, incubator licensees--businesses who qualify for program benefits by helping equity applicants-- are taking advantage of the applicants they’re supposed to be supporting.
In Oakland, which has a program that requires half of the city’s licenses be issued to equity applicants, the snail’s pace of progress is dashing hopes. Worse, some fear the setbacks will cost them their entire business. Time, after all, is a lot of money, especially as big money is rushing into cannabis. While there have been hundreds of applicants over a two-year period, only one has received its license and officially opened for business -- Blunts and Moore. Sacramento is running a program with the same lofty goal -- 50% equity licenses.
Only time will tell how effective these programs will be. Early signs warrant concern, plus there’s the obvious question of why earlier states, like Colorado and Washington, never legislated them. However, two things are certain. First, that conversations about social equity were happening before legal cannabis in Colorado. Miguel Lopez, former organizer of the annual Denver 420 rally, was expressing concern about minorities and low-income communities being priced out of the industry as early as 2012. Second, it is clear that in the absence of more diversity-driven awareness and policies, legalization is not a solution to racial bias in law enforcement. According to a 2018 report by the Drug Policy Alliance, in both states people of color remain more likely than whites to be arrested for cannabis offenses.
"It’s unfortunate that the issue of equity for those most impacted by the drug war was not fully taken into consideration in Colorado. I recall the Denver 420 Rally being against Amendment 64 arguing that medical marijuana regulations via Colorado House Bill 1284 shut many people out of the new industry via suitability requirements and high licensing costs without considering those currently incarcerated for cannabis. I was volunteering for the organization and doing a lot of ghost writing, and at first did not understand the impact and have now watched the industry become exactly what chief organizer Miguel Lopez predicted. It was a very contentious time.
Retroactively addressing the issue will make Colorado look better in history, which is a necessary step since social justice was part of the legalization conversation. My biggest concern about taking this long to address the lack of diversity in the cannabis industry is what is called the ‘first movers advantage,’ which are the advantages businesses that are first to market retain long term and that make them more likely to succeed. Many businesses working on regulations are now multinational corporations or being bought out by larger non-cannabis corporate entities and cashing in big while others are just now getting to the starting line. I think that to make the effort more sincere, state or local municipalities should create small business loans for people most impacted by the drug war and also create training programs to ensure minority businesses are competitive and attractive to investors.”
Like the broader movement of cannabis legalization, which is fraught with difficulties, social equity programs will require a sustained commitment for them to be successful. Despite what many critics say, these programs are not a failure. They are moving targets. That is why it is critical for governments implementing them, as well as the people they’re intended to benefit, to be vigilant, demand accountability, and gather the information necessary to evaluate them. As with anything cannabis, their greatest potential lies in post-federal legalization.
Remember New Jersey Senator Cory Gardner’s Marijuana Justice Act of 2017? It was the epitome of social equity in cannabis. Of course, it is not unlikely that future federal legislation will have social equity as its starting point. In the meantime, there’s plenty of opportunity for growth--and the learning experience that precedes it--for these first-of-their-kind experiments in social good.