Mass. falling behind on marijuana equity mandate
Money is key: Legislature needs to establish equity fund
AFTER MASSACHUSETTS voters legalized adult-use cannabis in 2016, the Legislature made history as the first in the nation to require full participation in the regulated industry by individuals who were harmed by previous marijuana prohibition. Unfortunately, five years later, our state is now falling behind others when it comes to meeting our own equity mandate.
This concerns me as one of five Cannabis Control Commissioners charged with ensuring the safe, effective regulation of a marketplace that has become an economic engine for the Commonwealth and 18 states (and growing) nationwide. On a more personal level, this deeply upsets me after growing up in Miami Dade County, where my community was destabilized by an illicit market for cannabis, among other prohibited substances, while over-policing and enforcement exacerbated the harsh inequalities that exist for Black and Brown people. I watched the War on Drugs play out in real time.
For its part, the commission has been intentional the last four years about creating policies to lower barriers to entry in Massachusetts: for example, there is no statewide cap on licenses, so there is no limit to the opportunities available for entrepreneurs who want to transition to the legal market. And, unlike the medical industry, adult-use licenses are not vertically integrated, which makes opening a business more attainable to those with less capital.
In addition, every single licensee must implement plans to hire diverse staff and support disproportionately harmed communities. Our agency also offers hundreds of individuals who meet equity-based criteria training and technical assistance (the first program of its kind in the nation), reduced fees, a leg up in the application review process, and a carve-out for certain licenses. And, since 2019, the commission has advocated for reform of host community agreements, which applicants say present challenges to entering the industry. The commission isn’t done seeking out additional opportunities to increase access for licensees, but the biggest obstacle to true equity is capital.
Meanwhile, other states have allocated financial resources for equity businesses through various iterations of a state fund. Connecticut set aside $40 million a year for their Social Equity Council, which can be used as direct assistance for equity applicants. In Illinois, equity applicants are eligible for low-interest loans through the state’s Social Equity Cannabis Loan Program. New York is developing a combination of grants, low-interest loans, and incubators for equity businesses paid for with cannabis tax revenue. And Virginia created a Cannabis Equity Business Loan Fund that will offer low-interest loans to equity licensees.
So, why not Massachusetts?
We continue to watch this market grow at a rapid pace in the Commonwealth. Since the first adult-use retailers opened in 2018, another 332 adult-use licensees have commenced operations and 183 retailers have generated more than $2.3 billion in gross sales. To put it simply, this industry is booming. But out of all operational licensees, only 22 participated in the commission’s equity programs, and another 29 are state-designated woman-, minority-, and veteran-owned businesses. These numbers continue to improve every month—with dozens more equity licensees in the commission’s queue who have not yet crossed the finished line to opening—and the solutions they need are waiting for action on Beacon Hill.
Several bills filed this session would create a fund to provide low- and zero- interest loans and/or grants to equity applicants and licensees. Individual commissioners have called for such a policy for years and, at our November 18 public meeting, all five voted to advocate for a state-administered loan or grant program composed of public and private funds to help finance equitable cannabis businesses in Massachusetts.Let’s be real about this: communities all over this state still experience the painful impacts of the War on Drugs today. The families that have been torn apart by over-policing and over-enforcement should be the first to benefit now that marijuana is legal. Massachusetts knows what it takes to make sure equity materializes, and now is the time to carry out its promise by investing in those who deserve to participate in this industry.
Nurys Camargo is a commissioner of the Massachusetts Cannabis Control Commission.