AUC

Weeding Out Opportunities for Social Equity if PA Legalizes Adult-Use Cannabis

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Weeding Out Opportunities for Social Equity if PA Legalizes Adult-Use Cannabis

From New York to New Mexico, Social Equity has been a priority in legalizing Adult-Use Cannabis and the responsibility to right the wrongs induced by the War on Drugs falls squarely on the shoulders of the government. 

The difference between NY and NM is that New York sewed the seeds of social equity into the law and New Mexico deferred definition of social equity mechanisms to an advisory committee , spending the better part of a year polling, surveying and studying best practices, while giving multi-state operators and “Big Marijuana” a head start for growth. 

“Our studies show that 40% to 42% of all Adult-Use Cannabis will be derived from out-of-state purchases, particularly Texas,” Duke Rodriguez, CEO of Arizona-based Ultra Health, told the Santa Fe New Mexican.

With no cap on licenses and land ownership, legacy operators and disadvantaged entrepreneurs lack the capital and resources for start-up costs. According to the New Mexico Cannabis Control Division, NM has granted priority to Minority license holders (Black, Asian American, Native American, mixed race and other), representing 33% of the industry. And although it’s obvious that a head start for small farmers and minority owned small businesses is necessary in a market expected to reach $400 million annually within five years, there is concern that the NM industry is doing a disservice to the community by not explicitly laying it out in the legislation. 

Even with the progressive discussion about micro-licensing, co-ops and reinvesting 40% of cannabis tax into low income communities, New Mexico might have done better by offering social equity opportunities prior to the passage of its AUC legislation. 

In comparison, the New York law provides for automatic expungement for previous convictions that engage in “activities that are no longer criminalized.” New York is also the first state to offer initial dispensary licenses solely to entrepreneurs with marijuana convictions through the Seeding Opportunity Initiative. 

According to the official New York Cannabis Conversations website, “the Office of Court Administration have expunged approximately 300,000 records and suppressed another approximately 100,000 from background searches as they await expungement.” The initiative also offers access to funding and resources to help prop up these businesses in the long run.

For states like Pennsylvania, who have yet to adopt Adult-Use Cannabis legislation, we have the chance to learn from both NY and NM when implementing laws that can provide opportunities for minority communities harmed by the War on Drugs.

If you are interested in getting involved in this important work in Pennsylvania, please reach out to Tara Zrinski, P3 Campaign Director via email at Tara@alltogethernowpa.org.

To learn more about All Together Now PA’s Pot Profits for Pennsylvanians campaign, visit alltogethernowpa.org/p3. 

Claiming a Piece of the P.I.E.S: What PA can Learn from Social Equity in the NY Cannabis Market

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Claiming a Piece of the P.I.E.S: What PA can Learn from Social Equity in the NY Cannabis Market

Everyone loves pie but, in this economy, it never seems like it gets divided up fairly. Twenty one states and Washington D.C. have legalized Adult-Use Cannabis (AUC), but social equity policies have varying degrees of success in providing a slice of entrepreneurial possibility to legacy operators. 

Pennsylvania has yet to legalize Adult-Use Cannabis, which puts us in a unique position to learn from other states, like our neighbors in New York, who are offering up valuable lessons…

Since AUC legislation passed in 2021, Forbes identified a potentially fatal flaw in New York’s regulatory structure that could jeopardize the good intentions of the approved social equity program that reserves Conditional Adult-Use Retail Dispensary (CAURD) licenses for applicants, or family members, who have been convicted of a cannabis related offense. This isn’t the only problem, though. There are questions as to how these CAURD licensees will procure or maintain inventory with no clear path to financing.

In a free market that depends on competition to weed out the most vulnerable entrepreneurs, it seems that the very people the law was meant to help are left just out of reach of their slice of the pie. 

The legacy community, pejoratively known as the “black market”, represents cannabis entrepreneurs operating under the radar. With the looming threat of incarceration, the legacy market operates under self-regulated authority for its own self preservation. While this kind of market can be characterized by gang violence, turf wars and untaxed cash transactions, the same market rids itself of bad actors, frowns upon selling to minors and prides itself on the quality of its bud. 

Out performing its regulated counterpart by three times, the legacy market should be acknowledged for its success- success that neither the war on drugs nor regulation could destroy. The question remains– how can the intention of legislation incentivize and partner with the legacy operators to transition to a successfully regulated market? 

A group of diversity, equity and inclusion (DEI) advocates with the National Cannabis Industry Association is hoping to bake a new social equity solution called P.I.E.S. into the mix. P.I.E.S. is an acronym for Pairing (existing marijuana operators with partners), Incubating(allocating resources, mentorships and technical assistance to launch successful businesses) , Excel (beyond launch to withstand startup challenges within first 3 – 5 years) and Seed (capital and inventory to cover initial startup cost). This program will provide a larger slice for legacy operators in disadvantaged communities most harmed by the War on Drugs. 

As the Pennsylvania legislature gears up to launch its own AUC legislation, proponents have the opportunity to advance meaningful social equity policies before free market capitalistic tendencies bend toward profiteers and multi-state organizations. At the end of the day, we need a policy that will right the wrongs of the war on drugs and keep pot profits on the plates of Pennsylvanians.

Tara Zrinski is the Campaign Director for the Pot Profits for Pennsylvanians (P3) Campaign. She joins All Together Now PA with a dynamic background as a local legislator in Northampton County, community organizer for environmental non-profits and adjunct professor of Philosophy at DeSales University and Northampton Community College.