Los Angeles cannabis businesses owned by minorities and other victims of the drug war are in the midst of a very expensive waiting game.
More than five months after city officials began licensing some cannabis businesses, applicants who applied through the LA’s social equity program, designed largely in an effort to counteract the racist consequences of the drug war, will finally get their shot at joining the commercial cannabis industry.
At the first meeting of the Los Angeles Cannabis Regulation Commission earlier this month, Cat Packer, executive director of the city’s Department of Cannabis Regulation, announced Phase 2 of Los Angeles’ licensing process will begin on August 1. This phase—the second of three licensing rounds for the city’s newly legal industry—is open to non-retail businesses, such as manufacturers, distributors, and other portions of the supply chain, that have been operating in the city since before January 2016 and plan to participate in some capacity in the social equity program. The phase was slated to have wrapped up months ago, but delays due to staffing shortages and other factors have slowed the plan’s rollout.
The delays have made for financial and logistical headaches for equity applicants seeking to obtain a city permit, which is required to enter the state-regulated industry.
“It’s just having to sit on something, pay interest on buildings, do build-out and construction, without really knowing what’s going to happen,” said Esteban Araya, whom Leafly first spoke with in November of last year, as he was beginning the application process to open a retail store in northeast Los Angeles. “Basically [we’re] just waiting and hoping they don’t change anything drastically that would change the building’s qualification.”
The city’s social equity program was put in place at the same time LA officials adopted a new set of cannabis regulations for the city. By giving licensing priority to applicants most affected by the war on drugs—such as those who have been arrested for a cannabis-related offense or who live in a neighborhood with high cannabis arrest rates—it aims to address the decades of disproportionate impacts that the war on drugs has had on minority communities,
But as the rest of the city’s cannabis plans went forward, the equity program has floundered. City officials claim the long delay was impossible to predict, but critics call it an avoidable flub caused by foreseeable funding issues.
The slow rollout has had the perverse effect of disadvantaging the very people it was designed to help: communities hit hardest by the war on drugs, including people of color and individuals convicted of nonviolent drug crimes. Rather than giving these groups a leg up, LA’s social equity program has effectively given a head start to the competition.
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Published: July 24, 2018
Founder & Interim Editor of L.A. Cannabis News