{"id":4318,"date":"2022-02-15T15:41:26","date_gmt":"2022-02-15T15:41:26","guid":{"rendered":"http:\/\/CBMiOmh0dHBzOi8vZmlsdGVybWFnLm9yZy9zb2NpYWwtZXF1aXR5LW1hcmlqdWFuYS1jb25uZWN0aWN1dC_SAQA"},"modified":"2022-02-15T15:41:26","modified_gmt":"2022-02-15T15:41:26","slug":"social-equity-applicant-to-grow-weed-in-connecticut-thatll-be-3-million-filter","status":"publish","type":"post","link":"https:\/\/thcinct.com\/?p=4318","title":{"rendered":"Social Equity Applicant to Grow Weed In Connecticut? That’ll Be $3 Million. – Filter"},"content":{"rendered":"
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A<\/span>s Connecticut prepares to launch its legal adult-use cannabis market later this year, the state is now open to applications from \u201csocial equity\u201d cultivators\u2014subject to a $3 million licensing fee in each case. The fee flies in the face of lawmakers\u2019 promise that legalization will benefit communities most targeted by the drug war.<\/p>\n

Cannabis cultivators will be licensed to grow and produce cannabis, selling their products to other businesses rather than directly to consumers. The $3 million licensing fee is written into the law<\/a>, so can\u2019t be reduced or waived unless lawmakers take action. <\/span><\/p>\n

Jason Ortiz, president of Students for Sensible Drug Policy<\/a> (SSDP), told Filter<\/i> that this was not<\/i> what advocates like him fought for in Connecticut. Lawmakers and Governor Ned Lamont (D) approved provisions like this one in last-minute compromises over the bill.<\/span><\/p>\n

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\u201cSo the government is going to charge someone who is certified as low-income multiple millions of dollars in order to skip the line. That is in no way, shape or form equitable.\u201d<\/span><\/p>\n<\/blockquote>\n

On paper, social equity applicants are getting an earlier opportunity to apply for a cultivator license; the state will hold a lottery<\/a> to award additional licenses later this year. <\/span>B<\/span>ut the astronomical fee effectively wipes out that benefit. MJBizDaily<\/em> reported<\/a> that $3 million is likely the highest fee for social equity applicants anywhere in the US. <\/span><\/p>\n

\u201cSo the government is going to charge someone who is certified as low-income multiple millions of dollars in order to skip the line,\u201d Ortiz said. \u201cThat is in no way, shape or form equitable.\u201d<\/span><\/p>\n

Yet Connecticut is, in theory, committed to social justice in legalization. The state\u2019s Social Equity Council states<\/span><\/a> that its goal is to \u201c[ensure] that funds from the adult-use cannabis program are brought back to the communities hit hardest by the \u2018war on drugs.\u2019\u201d<\/span><\/p>\n

In Connecticut as elsewhere, cannabis prohibition has targeted Black and other marginalized communities. The ACLU found<\/span><\/a> that in 2018, Black residents were over four times likelier than white residents to be arrested for marijuana possession\u2014and that despite the state decriminalizing marijuana in 2011, racist disparities in enforcement actually got worse<\/i> afterwards. <\/span>Nationwide, Black and white people use marijuana at similar rates.<\/span><\/p>\n

\u201cLicensing is being used to keep poor folks, people of color out of the industry,\u201d Ortiz said. \u201cIf we\u2019re going to say that fees can be unlimited, we\u2019re creating a very blatant pay-to-play situation.\u201d He<\/span> suggested that advocates should push for federal intervention to prevent the provision, though that\u2019s unlikely<\/a>.<\/span><\/p>\n

Would-be social equity cultivators in Connecticut whose businesses are located in \u201cDisproportionately Impacted Areas\u201d\u2014designated<\/span><\/a> by the state for high rates of drug convictions or unemployment\u2014were able to apply for licenses as of February 3<\/span><\/a>. <\/span>But the state defines social equity applicants quite broadly<\/span><\/a>, only requiring that at least 65 percent of a business be owned by an individual with less than 300 percent of the \u201cstate medium household income\u201d in the past three tax years. <\/span><\/p>\n

The fee makes it likely that a small group of well resourced companies will benefit instead. Connecticut previously legalized medical cannabis in 2012, and there are currently only four licensed cultivators in the state\u2014all of them large corporations operating in multiple states, and none of them headquartered in Connecticut.<\/span><\/p>\n

The state will now allow these medical license-holders to jump into the adult-use market. They can apply to expand to adult-use whenever they want\u2014unlike social equity cultivators, who have a limited 90-day window to apply. <\/span>To transition, they must first pay a $3 million fee as a producer, or $1 million as a dispensary owner. But Connecticut will cut those fees in half if the companies agree to partner with social equity applicants, through \u201cEquity Joint Ventures\u201d<\/span><\/a>\u2014<\/span>business entities that are at least 50 percent owned by a social equity applicant. <\/span><\/p>\n

And therein lies the game in Connecticut: incentivizing social equity applicants to partner with multi-state cannabis corporations. Equity applicants are incentivized to enter these agreements because the larger companies have more money and resources; the companies get their entry fees reduced. <\/span><\/p>\n

Ortiz slammed the \u201cEquity Joint Ventures\u201d, arguing they only exist to benefit established medical cannabis companies, not disadvantaged businesses. The medical companies can enter into an unlimited number of joint ventures, exempting them from limits on how many licenses one company can hold.<\/p>\n

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\u201cWe\u2019re going to see a crunch at the legislature to change something before the end of the year.\u201d<\/p>\n<\/blockquote>\n

\u201cBecause they\u2019re unlimited, it means the current operators can set up 20 or 30 of them, and they get to skip the lottery, skip the whole process and will dominate all the real estate in the state before the lottery even happens,\u201d Ortiz said. \u201cSo you have very limited licensing for the general population and equity applicants, and unlimited licensing for the multi-state operators.\u201d<\/span><\/p>\n

Ortiz and other advocates are pressuring the Governor<\/a> to repeal limits on the number of licenses available and create a more equitable market. And he predicted that voters will push lawmakers to do something, too. \u201cPeople are going to start freaking out about the details and we\u2019re going to see a crunch at the legislature to change something before the end of the year.\u201d<\/p>\n

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Photograph of a cannabis cultivation facility by Alexander Lekhtman<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

As Connecticut prepares to launch its legal adult-use cannabis market later this year, the state is now open to applications from \u201csocial equity\u201d cultivators\u2014subject to a $3 million licensing fee in each case. The fee flies in the face of lawmakers\u2019 promise that legalization will benefit communities most targeted by the drug war. Cannabis cultivators will be licensed to grow and produce cannabis, selling their products to other businesses rather than directly to consumers. The $3 million licensing fee is written into the law, so can\u2019t be reduced or waived unless lawmakers take action. Jason Ortiz, president of Students for… <\/p>\n","protected":false},"author":1,"featured_media":4319,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"","fifu_image_alt":"","footnotes":""},"categories":[2],"tags":[],"class_list":["post-4318","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-featured"],"jetpack_featured_media_url":"https:\/\/thcinct.com\/wp-content\/uploads\/2022\/02\/social-equity-applicant-to-grow-weed-in-connecticut-thatll-be-3-million-filter.jpg","_links":{"self":[{"href":"https:\/\/thcinct.com\/index.php?rest_route=\/wp\/v2\/posts\/4318","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/thcinct.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/thcinct.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/thcinct.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/thcinct.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=4318"}],"version-history":[{"count":0,"href":"https:\/\/thcinct.com\/index.php?rest_route=\/wp\/v2\/posts\/4318\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/thcinct.com\/index.php?rest_route=\/wp\/v2\/media\/4319"}],"wp:attachment":[{"href":"https:\/\/thcinct.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=4318"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/thcinct.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=4318"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/thcinct.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=4318"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}