Minority Marijuana Business Owners Get Incentives in Nine States

Incentives to Minority Business Owners

In an effort to address the disproportionate effects of marijuana prohibition on Hispanic and black communities, and to ensure equality in the emerging cannabis industry, many states are offering incentives to minority marijuana business owners. Currently, nine states have programs in place to encourage blacks and Hispanics to enter the weed market, and this a look at these efforts:

1. California

Voters in California approved recreational marijuana in November 2016, and we can only expect first retail sales of it in January 2018. Despite this, some cities, Oakland in particular, are setting aside half of its cannabis licenses for those previously convicted of cannabis crimes, those who live in areas where drug enforcement was especially intense, and those considered low-income minority residents.

Advocates of this program are lobbying for its acceptance statewide and demanding similar measures in places like Los Angeles and San Francisco. According to expert analysis of data from the Federal Bureau of Investigations, African-Americans only make up 5.6 percent of the Californian population, but in 2015, accounted for 16 percent of all arrests for marijuana.

2. Colorado

Colorado has the honor of being the first state to legalize recreational weed. However, it does not track demographics within its cannabis industry. Instead of the state mandating minority preferences, individual businesses are employing their own programs to hire minority groups. The Colorado Public Safety Department released a report with arrest statistics for the state.

After Colorado legalized marijuana, arrest rates increased for juveniles from the Latino and African-American communities. Arrest rates for white youth decreased. Although African-Americans make up 11 percent of weed arrests, they only made up four percent of the population in Colorado during the 2015 census. Canna-businesses are employing minority youths to equalize these numbers.

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3. Massachusetts

Those who voted to legalize recreational weed in Massachusetts’ 2016 ballot voted to encourage those “disproportionately harmed” by past marijuana laws and their enforcement to participate in the weed industry. The ballot included these measures at the time of voting. Anyone with a previous conviction for weed may work in the cannabis industry and apply for retail licenses.

In Boston City, Council members are drafting legislation to direct at least 20 percent of all taxes collected from marijuana activities toward racial equity programs, such as eliminating financial obstacles for minority business ownership. In 2015, African-Americans accounted for 34 percent of weed arrests in the state, but they make up less than seven percent of the state’s total population.

4. West Virginia

Recently, West Virginia legalizes medical marijuana. In West Virginia, medical marijuana is legal only for specified health conditions. Back in April, the state introduced a new law that includes a specific provision requiring state regulatory agencies to encourage minority-owned marijuana businesses to apply for cultivation licenses. Nearly four percent of West Virginia’s population is African-American, yet they make up 19 percent of marijuana arrests.

5. Florida

Last year, lawmakers in Florida passed a bill to address equality issues that became evident with the medical marijuana laws the state enacted in 2014. Now, it includes provisions to encourage and favor black growers over others. According to these provisions, when the state has more than 250,000 medical patients, it will instigate steps to ensure that supply meets demand.

When this happens, members of the Florida Black Farmers and Agriculturists Association will have first access to growing licenses. Florida’s black farmers were among those who famously sued the U.S. Department of Agriculture on racial discrimination grounds. They claimed government denied them subsidies and loans throughout the 1980s and 1990s. In 1999, the case reached a historical settlement.

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6. Pennsylvania

Medical marijuana became legal when lawmakers passed the bill in 2016. Subsequently, the state Department of Health has been writing regulations to include certain minority-favoring policies. All cannabis operations must comply with diversity requirements, which require participation of all minority groups in every aspect of their businesses. Eleven percent of the population is African-American.

Specifically, all those applying for dispensing and cultivating licenses must include a diversity plan in their applications, which must clarify exactly how the company plans to achieve racial equality in contracting, employment, and ownership. The onus is also on weed businesses to educate minorities, who make up 35 percent of arrests, on how to apply for dispensing and cultivating permits.

7. Washington

Washington legalized recreational marijuana back in 2012. Since then, licensed retailers have grown to nearly 500 across the state, three percent of which are already African-American. Statistics for Asians, Latinos, and other minorities are not yet available. In Washington, black people make up 3.5 percent of the total population, yet they are responsible for 11 percent of weed arrests.

The Washington State Liquor and Cannabis Board are drafting regulations to ensure diversity in license applications. When the state decides to give more licenses to people in the future, it will use targeted outreach programs to both reach minority communities and encourage them to involve themselves in the state’s marijuana industry.

8. Maryland

Lawsuits plagued Maryland’s medical marijuana program since its rollout. The state only allocated 15 cultivation licenses, leaving many groups unhappy. Despite specific laws regulating “racial, ethnic, and geographical diversity” for cannabis licensing in the state, minorities did not own any of the businesses awarded. The state now wants to issue another seven growing licenses to make up for this disparity.

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Maryland will issue two of these licenses to companies that are suing the state. Minority-owned businesses will receive the other five licenses. Currently, Maryland’s minorities constitute 48 percent of its population. African-Americans account for 30 percent of this. In 2015, 57 percent of weed arrestees were black people. The state is now regulating inclusion of these demographics.

9. Ohio

Ohio’s original medical marijuana law included a license quota for minority-owned businesses specifically. There are debates about whether it would hold up in court, though. Regulations require blacks, Native Americans, Asians, or Hispanics to receive at least 15 percent of state-issued cannabis licenses. This is to ensure their four main minority groups are less disadvantaged economically.

To date, these provisions remain unchallenged in the court of law, but the state is actively incentivizing minority groups to apply for marijuana licenses. Ohio’s 2015 population census shows that 12 percent are African-American, yet police arrest black people at a rate of 35 percent for cannabis-related offenses. Minorities hit hardest by past prohibition now have opportunities available to them.

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Comments (2)

  1. mad max July 9, 2017 / 7:15 am / Reply

    Great information. Many states are offering incentives to minority marijuana business owners.

  2. rashi July 10, 2017 / 12:16 pm / Reply

    Thanks.. @potvalet. need more state information.

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