The first thing a customer might notice is the windows. At Common Citizen’s Flint, Mich., storefront, the windows are large and gleaming. It’s a welcome sight, a warm invitation to come in.
On the way into the shopping area, around the corner from the check-in desk, customers walk through a café. Eventually, the goal is to station a barista and bring in a local roaster to provide a space for customers to connect in a more relaxed environment. “The idea was to slow them down, not to speed them up,” Common Citizen CEO Mike Elias says, “and to have a cup of coffee and talk about cannabis outside of the retail floor, just to connect and make it comfortable and familiar.”
For now, Common Citizen is allowed to give coffee to customers for free on some days, but the café is an example of the long-term, customer-focused planning that the company is working out with state regulators. In Michigan’s new adult-use market, Common Citizen is exploring the possibilities of what a dispensary environment can look like.
In January, the International Council of Shopping Centers (ICSC) honored the company’s Flint storefront with the Gold Award for retail store design. It was the first time that the ICSC recognized a cannabis business with the award, another notch in the ongoing normalization of this industry in the U.S. and abroad.
“We realized that consumers are coming in to feel a certain way,” Elias says. “There’s a need. Why not design [dispensaries] based on those need states?”
Common Citizen dispensaries are called “chapters,” budtenders are “citizen advisers,” and products are organized by approachable categories that make sense to consumers.
Customized for Customer Preferences
Once inside the shopping area at one of the company’s three open dispensaries in Detroit, Flint and Battle Creek, customers encounter color-coded tables with helpful signage that explains the common experiences as well as the chemical properties of each product.
There’s “Unplug,” which is focused on solo cannabis use and more relaxing, sedative terpene profiles for nighttime consumption. “Daily Dose” is a microdosing section that appeals to casual consumers interested in overall wellness. “Time to Shine” is a classic adult-use suite: vibrant terpene profiles and high cannabinoid content, all leaning on the euphoric effect of the plant. “Sweet Relief” is geared toward medical patients seeking high THC content and specific products like Rick Simpson Oil (RSO).
On the floor, citizen advisers help guide customers through the options, often asking questions about their cannabis experience (if any) and desired outcomes.
Common Citizen launched adult-use sales on Feb. 27. Elias says the sales volume increased dramatically after the dispensary became the first to secure an adult-use license in Flint, a city of about 100,000 residents. When the adult-use market opened in late 2019, only 21% of Michigan municipalities had decided to allow adult-use cannabis sales.
This new landscape gives Common Citizen something of a blank canvas to work with. There are evolving state and local regulations, but within that context the company sees its employees as the frontline creative minds developing what an adult-use cannabis experience feels like in Michigan. Elias says this is in part due to his and his fellow co-founders’ engineering backgrounds. Data, he says, drives the mission. And the mission drives the passion. He compares the company to a fast-moving, nimble tech startup. Change is the only constant.
“In a lean culture, instead of prescribing direction, we create hypotheses that need to be proved out by the staff.” Mike Elias, CEO, Common Citizen
An Eye for Continuous Improvement
Elias’ background is in lean manufacturing and Six Sigma in health care. He’s an operations-focused CEO, the former chief transformation officer at North York General Hospital in Toronto.
“The answers to improvement are all at the front lines,” he says. “If you want to get really good at strategy, the connection between what’s happening at the front line and the senior team needs to be flattened, so that we can elevate the staff in the discussion on where we need to go, how fast we need to go, how much [we need] by when because they’re the ones that do the work. In a lean culture, instead of prescribing direction, we create hypotheses that need to be proved out by the staff. The data and the dialogue is happening almost hourly from the front lines. As a strategist, we are just creating an environment to unleash their creativity.”
After serving Flint’s corner of the Michigan medical cannabis market for eight months, Elias says the switch to adult-use was a natural proving ground for this leadership mentality. Sales would obviously increase, so what could the staff do to brace themselves for the surge?
“In terms of what we did operationally, we revamped our entire inventory control system,” he says. “We ran what we call a ‘kaizen event.’ This is an industrial engineering, lean manufacturing tool where essentially we mapped out current state, determined future state, came up with a gap analysis and identified all the constraints in the inventory control system that robbed us of value-added capacity.”
Put simply, Common Citizen used its sales data to better understand what inventory was moving when and why. It centralized and streamlined that inventory management system so that employees could better connect with customers in the store. By using yesterday’s data to understand how tomorrow’s sales would unfold, Elias says the team found that it could strip away some of the excess inventory it was holding in the back of the store. “We designed out all the waste,” he says.
Educated Citizens
Out on the sales floor, Elias says that a focus on cannabis education can accomplish a similar effect. If citizen advisers lead with education about a particular product category or terpene, they don’t need to upsell. The story captures the customer’s interest. Common Citizen always considers customers who aren’t already active cannabis consumers. What are they looking for in the retail environment?
Part of the “chapter” and “citizen advisory” concept is the fundamental idea of doing away with old-school terminology that may turn off new customers. Citizen advisers provide each customer with a Citizen Code Book that defines some of the more scientific jargon that will be used on the sales floor (e.g., “myrcene,” “concentrates”). The Code Book explains the interplay between terpenes and cannabinoids, offering plainspoken perspectives on how the entourage effect steers certain chemical reactions in each cultivar. And if nothing else, it’s a helpful conversation-starter.
“We consider ourselves educators before we’re retailers,” Elias says. “Our job is not really to push product but to give as much education as possible. When the customer or patient are ready to buy, we’ve already established some level of rapport and respect.”
Common Citizen’s parent company, Michigan Pure Med, was founded in 2017 by four engineers with roots in Detroit. The plan is to hone the company’s craft in their home state before any future expansion. Elias says it’s a purpose-driven company, and the purpose is igniting the passion of its staff. “The staff needs a mission,” he says. “They need a mission, because when they have a mission, their passion comes across in the interaction with the consumer, and that’s how the brand is elevated.”
This manifests in the company’s “employee happiness strategy,” a “chief citizen officer” who works with citizen advisers on the front lines, and daily huddles where staff work together on pressure points and celebrate wins.
Even after customers leave the store, citizen advisers like to stay in touch. “We call them,” Elias says. “We follow up. Every citizen adviser has a patient list, a customer list, where, when they have downtime, they call them—if they gave us their contact info, which many of them do. They say, ‘Hey, how’d it go? How’d it work out for you?’”
In these conversations, citizen advisers are able to dial in their customers’ preferences for the next time they come into the shop, whether that be for a cup of coffee or another flower purchase at the Time to Shine table.
Eric Sandy is digital editor of Cannabis Dispensary and Cannabis Business Times.
5 Tips for Creating a Winning Cannabis Retail License Application
Departments - Quick Tips
As application processes become more demanding, Cresco Labs’ Mackenzie Ditch Wilcox offers these insights to help retailers successfully navigate the licensing gauntlet.
With the rapid expansion of the legal cannabis industry, the competition for winning a desired retail license has significantly increased, and today, the application process is more demanding than ever. To help navigate this daunting process, here are five key tips for creating a winning retail license application.
1. Build a Strong Executive Team.
A critical component of any cannabis license application is establishing a great team of owners and officers. As licensing becomes more competitive, it is crucial that this team has the necessary experience and background to operate a successful cannabis retail operation. For medical retail applications, consider adding someone with pharmaceutical experience. Also, highlight individuals with business, finance, regulatory and sales experience (especially those individuals with experience in highly regulated industries) to show the governing agency that upon licensure, your establishment has the tools to succeed. Although it seems obvious, do not forget to highlight your team members with legal cannabis experience.
2. Highlight Your Team’s Community Involvement.
When developing relationships with and interviewing potential team members, consider asking questions like, “What have you done for the community?” and “Are you involved in any organizations, charities or community events?” By building a team of philanthropically minded individuals, you are showing that your business will positively impact the community beyond the cannabis industry.
3. Develop relationships.
To further enhance your application, develop strong relationships in the community in which you intend to operate by reaching out to people who can provide guidance into what the city or town is specifically looking for in a cannabis retailer.
Consider working with key stakeholders like local law enforcement, local business owners, local parent/teacher organizations, volunteer organizations and event planning groups.
4. Identify Real Estate.
One of the first steps in creating a successful cannabis retail application is securing property that is suitable for your needs and has proper zoning. When looking for property, make sure you are paying close attention to the setback requirements of the state and local jurisdiction. In addition, focus on specific locations and how they will best suit the needs of your patients and/or consumers. To boost your application, don’t forget key factors like proximity to public transit, parking availability and traffic considerations.
5. Prepare, Execute and Edit.
An application can take months to prepare. Because many components of the application are directly intertwined, it is critical to set deadlines at the beginning of the process to give your writing team enough time to edit and organize your application. Consider creating a style guide at the beginning of the process to ensure all responses are presented in the same tone, voice and structure. Many jurisdictions receive hundreds (if not thousands) of applications, and having a polished, professional application can help set yours apart from the crowd.
Mackenzie Ditch Wilcox, J.D., is counsel for multistate, vertically integrated cannabis company Cresco Labs and guides the license application process for the company, including licensing, regulatory incorporation, and application strategy.
Is the Cannabis Industry Ready for Blockchain?
Features - Features
As blockchain-powered technology and the cannabis market mature, adoption grows near.
From the vaping crisis to the COVID-19 pandemic, recent events have intensified the need for transparency and trust in the cannabis supply chain to ensure packaging and products are contaminant free.
Now, perhaps more than ever, supply chain partners and customers want more information about industry practices and products.
Blockchain, steadily gaining adoption in other markets, could be the next game-changing technology for the cannabis industry. Proven in mainstream food safety, pharmaceuticals and other sectors, blockchain-powered platforms offer potential benefits for everyone, from breeders with new genetics to consumers shopping dispensary shelves.
Understanding Blockchain Basics
Cannabis attorney Braden Perry, partner at Kansas City, Mo., law firm Kennyhertz Perry, helps companies implement novel and emerging technologies, including blockchain. An expert in enforcement, digital currencies, and regulatory and compliance issues, Perry suggests the easiest way to envision blockchain is to think of it as a digital ledger—one that contains a series of unchangeable records.
Rather than transaction lines found in general financial ledgers, blockchain contains information packets called “blocks.” The blocks are connected chronologically to form a chain. They store a wide range of product-specific and transactional information, including the time and date for specific actions, product origin and process steps or product inputs. For the cannabis industry, critical data in a block might include genetic information, lab results, cultivation inputs, supply chain logistics, location tracking and consumer feedback. Blockchain has endless applications and can be used to record and track anything.
A typical end user of a product doesn’t see a block, they just see a software program interface. How the information “looks” to an end user will depend on how the blockchain-powered software product they’re using presents that data to them.
Unlike traditional databases, the blockchain ledger is decentralized. The information it holds is stored across multiple locations, entered by trusted partners and synchronized by consensus of those partners, protecting data integrity. Once created, a block cannot be changed. New data, including corrections to prior entries, result in new blocks. The original block remains constant, an immutable record of what’s within.
“From a seed-to-sale perspective, especially in today’s regulatory environment in the legal marijuana industry, the recordkeeping and reporting is very complex,” Perry says. “This automated ledger ensures [information] cannot be altered from either an intentional standpoint, such as a forgery or other type of wrongdoing, or an unintentional standpoint, such as an error.”
With blockchain, we can get all the information— even the efficacy studies and consumer feedback and all of that—put into a system that can make it readily accessible by the parties that need to access it at any time, and the information is secure.” Robert Galarza, CEO, TruTrace Technologies
Overcoming Misconceptions
Perry points out that many people erroneously believe that blockchain and cryptocurrency are synonymous. Larry Levy, CEO and co-founder of Lucid Green, also notes that many in the cannabis industry have struggled to separate the two concepts. While blockchain technology makes cryptocurrency possible, they are not the same. Blockchain, free from the risks and regulatory issues associated with cryptocurrencies, can just as easily power seed-to-sale tracking systems, genetic validation or transparency of lab results.
Lucid Green, a cannabis supply chain platform, launched in late 2018 with a blockchain-empowered product QR code aimed at brand-to-consumer and brand-to-budtender education and marketing—and a token-based rewards program. The platform received strong resistance from brands swayed by misconceptions about blockchain, Levy says. “It completely blew their minds,” he recalls. “They were in a high-risk industry anyway. Then here’s another thing they see as high risk.”
Now, Lucid Green keeps it simple. “We don’t bring up blockchain because [brands] are not interested in the technology,” Levy says.
The company’s private blockchain network operates as a centralized database for now. “But the minute the industry grows up and can sustain and support decentralized, trusted actors putting data in, we’ll just switch that on,” he says.
Levy’s experience highlights another misconception, that decentralized blockchain platforms expose proprietary information to the world. With permissioned blockchain networks, you control who sees what and who creates blocks. Blockchains can be public, private or a combination of both. And, yes, separate blockchain networks can communicate.
“You can have your own enterprise blockchain where certain information is shared and other information is siloed off,” Perry says. “If you’re worried about potential intrusion or corporate espionage, private blockchains are a way to lock up the information where you only have access to it, but the reporting is secure.”
As blockchain’s benefits become better known, blockchain-empowered cannabis-related products and services will grow. Robert Galarza is CEO of TruTrace Technologies, whose blockchain-based StrainSecure program registers and tracks intellectual property (IP) in the cannabis industry. In partnership with Shoppers Drug Mart, Canada’s largest pharmacy chain, TruTrace is piloting blockchain-secured programs to track and trace “from genome to distribution.” Decades of enterprise technology experience fuel Galarza’s enthusiasm for blockchain’s potential.
“With blockchain, we can get all the information—even the efficacy studies and consumer feedback and all of that—put into a system that can make it readily accessible by the parties that need to access it at any time, and the information is secure,” he says. “In the supply chain, it brings an integrity to this industry that we’ve never had.”
The following are some of the ways blockchain-powered technology is already benefiting cannabis and non-cannabis businesses:
1. Rapid, real-time traceability. Blockchain’s secure technology ensures an accurate, permanent record, but it also allows rapid access to specific details within the large amounts of stored information. With blockchain, businesses can instantly get a specific product’s full history and access present and past locations in the supply chain.
A high-profile, mainstream example is Walmart’s incorporation of IBM blockchain technology following E. coli scares with romaine lettuce in 2018. Blockchain reduced the time it took supply chain tracking to locate lettuce sources from seven days to 2.2 seconds. Galarza says blockchain offers the same speed to cannabis supply chains.
2. Improved efficiency and reduced costs. Labor remains one of the largest expenses for cannabis businesses, whether they operate cultivation facilities, retail shops or both. Perry believes blockchain can streamline time-consuming tracking, reporting and auditing, and eventually reduce the need for staff and oversight related to those functions. “Obviously, upfront costs are going to be there, but in the long term, businesses will likely save,” he says.
3. Product validation and standardization. Levy suggests the greatest cannabis-related potential for blockchain’s decentralized, distributed ledger lies with genetics. As Galarza points out, cannabis has long been identified primarily by street names. Under blockchain-powered programs like the Shoppers Drug Mart pilot, genetic cultivar information is being collected, registered, tested and published through the secure, permanent infrastructure blockchain provides.
Growers can protect their IP. Researchers can identify specific genetic and chemical profiles. Medical providers and retailers can be sure they receive consistent products and verify provenance, testing results, patient outcomes and other immutable information.
4. Compliance efficiencies. For U.S. growers bound to state-mandated tracking systems, Levy expresses doubts about blockchain’s promise: “From a compliance perspective, I just don’t see the need to overcomplicate what is already a very onerous process because of the whole track-and-trace requirement that the states have decreed.”
But Perry believes that part of blockchain’s power lies in compliance and enforcement. “[Blockchain] eliminates human error and the ability for mischief along the way and really eliminates any fear that a state or a regulatory body might have that anything has not been reported properly,” he says. “Being able to provide bulletproof evidence that your compliance is complete is the biggest advantage right now.”
Galarza sees opportunities for blockchain-improved compliance by supporting systems already in place. “We don’t want to replace track-and-trace. We want to empower track-and-trace,” he stresses. “We have to be the ones to support [those systems].” He says that’s done by building tools that help bridge gaps and can touch many competing seed-to-sale platforms and push information between those systems.
5. Consumer confidence. Blockchain-powered scannable codes and other technologies can increase transparency and provide end consumers with secure, verified product identification and information to drive confidence and brand loyalty.
“With blockchain, whatever way you want to show a consumer how your product is superior to others, from seed to sale, you can prove that without having to deal with claims of bias or inaccuracy,” Perry says. “I think it’s really important from the consumer standpoint to know exactly what they’re getting and how they’re getting it.”
Galarza expands on blockchain-empowered opportunities for cultivators and dispensaries. “Through scanning a QR code or some newer packaging technology, [consumers] can know what’s in this exact product and batch, down to the more granular details if you want them to see them,” he says. “It’s just a matter of saying, ‘OK, we have full, transparent traceability.’ From a quality assurance perspective, why wouldn’t we make that accessible to individual customers and patients on the packaging?”
Anticipating Blockchain’s Future
Though the cannabis industry has been slow to embrace blockchain, Levy says he anticipates rapid change: “Many of the cannatech solutions that are out there have literally grown up out of people’s basements because the big software companies didn’t want to touch a weed company.” He believes that consolidation and normalization will bring blockchain leaders into the cannabis industry. “That’s how the industry is going to grow up,” he says.
Perry agrees that mainstream blockchain platforms will enter the cannabis industry soon. “It likely willbecome much more enticing both to big technology as well as the industry itself,” he says. “Once one of those big companies gets a product out there, there will likely be a snowball effect. I really think it is the future of the industry from at least the supply chain and the tracking aspect.”
Galarza expects companies like Shoppers Drug Mart and Walmart will drive blockchain adoption as cannabis matures and supply chains grow more complex. “Companies need to know what they’re getting is safe before they put it in the hands of people,” he says. “I think that’s already what we’re seeing in Canada and what we’re seeing with the bigger companies in the U.S., where we’re seeing it a little bit more [on] the CBD side.”
Galarza advises cannabis businesses, from breeders to retailers, to look ahead and understand the infrastructure demanded by the food, drug and consumer packaged goods (CPG) industries—that blockchain-secured technologies help provide—and then work together to see the cannabis industry thrive.
“The maturity I hope to see in the industry in the next couple of years is everyone says, ‘We love this industry. We want to see it grow.’ We have to band together and do the best we can at what we do,” he says. “And if somebody does it better, then we go back to the drawing board and work harder to make what we do better. That’s the one thing that I hope to see as we evolve.”
Sarah Hinzman
Business, Government Leaders Push for Social Equity, More Diversity in Cannabis Market
Features - Cover Story
The fight to expand cannabis industry access and opportunities for communities prohibition hit hardest.
Although she cannot change the past, Roz McCarthy still wonders today how her mother’s cancer treatment may have been different had she had access to medical cannabis.
Maggie Lois Smith, who began her career as a UPS driver in the 1970s, worked hard and pushed McCarthy to do the same so her daughter could be successful. “I never went a day not thinking and not knowing that I felt like I was her star,” McCarthy says now.
Diagnosed with breast cancer in late 2003, Smith passed away in early 2005. She was 54. McCarthy says the death of her mother felt more like the loss of a twin. Smith had McCarthy when she was 19, so they were close both in age and in their relationship.
McCarthy later learned about medical cannabis and thought it could have improved the quality of the end of her mother’s life, as Smith pushed through chemotherapy and radiation treatments and lost about 70 pounds. “I remember those days where she just could just barely hold down food,” McCarthy says. “I thought, ‘Man, this could have been an option.’”
That experience is part of what has inspired her to push for education about cannabis in communities of color and, more recently, for more representation of people of color in the industry.
Roz McCarthy took her 25 years of experience in the health-care field to advocate for minority access to cannabis and representation in the industry.
She hopes now, as legalization and normalization grow, that cannabis can be a stigma-free option for her son, Bryan, who has sickle cell anemia. In the U.S., sickle cell anemia is most common among African Americans, with about one in every 400 African Americans being born with the disease, according to the Cleveland Clinic. Bryan, who now attends pharmacy school at Florida A&M University, doesn’t have a medical marijuana card to treat symptoms but does take cannabidiol (CBD).
“If he needs to use cannabis as a pain control option, I don’t want people looking at him thinking he’s just trying to get high because that’s not what he [would be] doing,” McCarthy says. “He’s trying to control his pain.”
These personal experiences, along with decades spent working in the health-care field, including writing grants for health-care facilities in medically underserved areas, stirred a new idea in McCarthy. In 2016, McCarthy founded Minorities for Medical Marijuana (M4MM) to provide resources to minorities who could use cannabis as a treatment option despite being possibly persecuted for it in the past or knowing people who had been. (She also consulted with and served on the board of the California Black Chamber of Commerce and consulted the African American Chamber of Commerce of Central Florida on business development.)
“I’m not a consumer, had never tried [cannabis],” says McCarthy, M4MM’s CEO. “I was just someone with a health-care background, 25 years of experience working in the health-care industry, and have my own personal experiences where I felt like, ‘Wow, this could be something that has to have some legs.’”
The nonprofit organization now has 27 U.S. chapters and international chapters in the United Kingdom, Jamaica and Toronto, McCarthy says. Its leadership and chapter presidents educate the public and lawmakers about the stigma around cannabis use and how to break it; aid those with marijuana possession charges to get their records expunged; teach entrepreneurs what it takes to run and manage a cannabis business; and work with cannabis stakeholders and government leaders to involve more minorities, women and veterans in the industry.
The war on drugs has led to the arrest and incarceration of disproportionate numbers of minorities in the U.S., including many for marijuana charges—and many criminal records and prison sentences that are still in effect today. For these and other reasons, many members of communities of color are still cautious to try cannabis. However, as cannabis’ benefits, both medical and economic, become more researched and understood, McCarthy and others are pushing for more access to product in communities of color and more minority representation in the industry.
Legislative Challenges.
McCarthy and others have succeeded in making advocacy and lobbying pushes to convince states and municipalities to set up social-equity programs for prospective business owners as well as diversity and inclusion programs for employees in the cannabis industry. These programs may include reduced application and license fees, and low-interest loan options for applicants, as in Illinois, or they may allow for priority application review, as in Massachusetts. Or, as in both of these states, they may provide technical assistance. But challenges to achieving equity remain, and not everyone agrees on one clear path ahead.
In Ohio, two judges have ruled the requirement to issue 15% of medical marijuana business licenses to “economically disadvantaged groups,” including minorities, unconstitutional. After the more recent ruling by a Madison County judge in November 2019, a spokesperson from the Ohio Board of Pharmacy said the 15% requirement is “no longer in effect.”
And prior to the state shutting down the requirement, the Board of Pharmacy spokesperson and another spokesperson from the Ohio Department of Commerce say, dispensary owners with a 51% or more stake in their business who were “economically disadvantaged” accounted for nine of the state’s 56 dispensaries. Meanwhile, two of the state’s cultivators and none of its processors came from these groups.
Illinois designed its social equity program to be “race-neutral” so that it can hold up in court, says Toi Hutchinson, senior adviser to the governor on cannabis control and a former state senator. But it addresses social equity in areas where people have been the most disproportionately impacted by the war on drugs and where many African Americans and Latinos live. To that end, the state created a “Disproportionately Impacted Areas” (DIA) map that plays a role in determining who can qualify as a social equity applicant.
“What we know about that population is that it’s 55% African American and 22% Latino that have been disproportionately impacted,” says Hutchinson, who played a large role in drafting Illinois’ legalization bill in her role as a state senator. “We know that. So, we designed an application, we designed a process, we designed a system that would try to get some of those folks the ability to come into this thing.”
From left to right: M4MM’s Roz McCarthy; Tammy Frazier, Florida chapter president; Carla White, membership director; and Erik Range, board chair
Individuals and organizations are taking varying approaches to increase minority access to ownership in the industry and improve their chances of earning intergenerational wealth—but not everyone agrees on how exactly to do it.
McCarthy sees 5% or more as a sizable percentage of equity in a business entity. Owners with more equity or a controlling interest have more decision-making power, she says.
“Studies have shown that the more diverse a company is, the more profitable that company is,” McCarthy says. “If I were an investor and I wanted to invest my money, I want to have … individuals who understand how to build a 21st-century business that is in line with a Coca-Cola, Delta, United Airlines, [that value diversity] in that respect.”
Illinois reviews new dispensary license applications using a point system. In order to qualify for social-equity status, a business must have an owner who either comes from areas the state designated as “disproportionately impacted” by the war on drugs, has been charged with cannabis crimes that are eligible for expungement, or has family members who have been charged with such crimes. That individual must have a 51% or more stake in the company for the business to be a social equity licensee.
A social equity applicant also can be a business with 10 or more full-time employees, 51% or more of whom live in DIAs. Or it can have 51% or more employees who have been charged with crimes eligible for expungement, or whose family members have been.
The state’s legalization bill passed in May 2019, and cannabis sales became legal in the state Jan. 1, 2020. Many people, including in the industry, have applauded the state’s bill and its social equity provisions.
But others, such as members of Chicago City Council’s 20-member Black Caucus, expressed concerns that existing medical operators were the only ones the state approved to sell into the adult-use market on Jan. 1. Social-equity licenses will come online on or before May 1.
Jason Ervin, 28th Ward alderman and chairman of the Black Caucus, said prior to legalization in Illinois, African Americans have been disproportionately impacted by arrest and incarceration due to marijuana offenses, so they should be able to fully participate in the industry once it is legitimized. “We’re going to buy today, we’re in jail today, so why can’t we have equity today?” he asked.
In October 2019, Ervin introduced an ordinance to delay cannabis sales in Chicago until July 2020, with the goal of giving minorities access to the market share in the city. Two months later, that effort to delay sales failed. The state saw $110 million from adult-use cannabis sales alone during the first three months of 2020, according to the Illinois Department of Financial and Professional Regulation. Sales were more than $1 million higher in March compared to February. On March 20, in response to the coronavirus pandemic, Gov. J.B. Pritzker announced a stay-at-home order but he deemed cannabis businesses “essential.”
Some cannabis-industry operators, like Illinois-based multistate operator Cresco Labs, have created incubator programs to aid social equity applicants. Cresco, through its Social Equity & Educational Development program, teaches people how to apply with the state for a dispensary license and provides them coaching and pro bono legal counsel, says Jason Erkes, the company’s chief communications officer.
“I think it’s important to note that you can’t go back and change the past, but you can take very aggressive steps to make sure that the future looks differently,” Erkes says.
Meanwhile, McCarthy and M4MM, through the nonprofit’s Cannabis Business Licensing Bootcamp, teams up with funding partners and cannabis companies, such as presenting partner Trulieve, to teach aspiring cannabis business owners about the industry. Education touches items such as how much compliance can be involved, how to read and understand application processes, how to build a team, how much products should cost in the supply chain and more. McCarthy and her team have held boot camps in St. Louis, Newark, N.J., and Chicago.
“They either decide, ‘Yes, I want to go forward,’ or they figure out, ‘You know what? No, this is not the right fit for me,’” McCarthy says. “And they now have made a really educated decision on where they want to get into the industry. Maybe it’s not at the touch-plant position—maybe it’s somewhere else. That’s what makes me happy, that people are not going and spending $6,000 for an application fee, when really and truly, that’s not what they want to do.”
A Second Chance.
To alleviate some of the damage done to people’s lives by prohibition, states across the country, such as Illinois, California and New York, are decriminalizing cannabis and expunging records.
Across the U.S., minorities make up a disproportionate percentage of people who have been charged with cannabis crimes. African Americans make up roughly 13% of the U.S. population and Hispanics make up about 18% of the population, according to the U.S. Census Bureau. However, black and Hispanic people received more than 84% of the federal sentences for marijuana trafficking in 2018, according to the U.S. Sentencing Commission.
In California in 2018, about 60% of misdemeanor marijuana arrests and 59% of felony marijuana arrests were of black and Hispanic people, according to state Attorney General Xavier Becerra’s office and the Department of Justice. This was slightly down from 2017, when those arrests were about 60% and 61%, respectively.
In New York, Gov. Andrew Cuomo previously vowed to push for adult-use legalization in 2020, but as of press time, he announced plans to cut that proposal in response to the coronavirus.
However, Cuomo signed a bill in August 2019 that downgraded the B misdemeanor of fifth-degree criminal possession of marijuana to the violation of first-degree unlawful possession of marijuana, according to the New York State Division of Criminal Justice Services (NYS DCJS). The bill also downgraded the violation of unlawful possession of marijuana to the violation of second-degree unlawful possession of marijuana.
When these violations result in defendants taking plea bargains, having their fingerprints taken and getting convicted, the state automatically seals records. Convictions from prior to the passage of the August 2019 bill, for the charges that the state downgraded, are “automatically suppressed from civil ... or criminal inquiry response,” according to an NYS DCJS spokesperson.
Arrests of black and Hispanic people comprised about 80% of misdemeanor possession arrests in New York state in 2018, according to NYS DCJS. In 2019, that decreased slightly to about 75%, when the state downgraded the fifth-degree misdemeanor possession charge to a violation.
In late March, amid the COVID-19 pandemic, activists worked to clear jails of people awaiting trial for and convicted of cannabis-related crimes, says Sarah Gersten, executive director and general counsel for Denver-based nonprofit Last Prisoner Project. It’s wrong for people to remain incarcerated for something that many states are legalizing, she says, let alone to be confined in such close quarters with unsanitary conditions as an infectious virus spreads.
The Last Prisoner Project created a “Decarcerate Now” petition, directed to President Donald Trump and the Federal Bureau of Prisons, to convince the federal government to release inmates in the U.S. who have been convicted of cannabis crimes.
“Another thing that I think is critically important, because a lot of the focus is on the federal level, is for folks to contact their state and local officials, contact sheriffs and wardens of local jails, your governor, your state department of corrections,” Gersten says.
As of press time, some states and municipalities have cleared out jails and prisons, and others have chosen not to jail people for certain crimes.
In March, Virginia lawmakers in both the Senate and House voted to decriminalize cannabis. Gov. Ralph Northam’s deadline to vote on the bill is April 11, according to the Virginia Legislative Information System.
M4MM, through a new program called Project Clean Slate, plans to pull together attorneys and court clerks for expungement fairs, McCarthy says. However, it’s challenging to bring everyone together in one room. After the fairs, M4MM would like to offer wraparound services.
“They see the work that we’re trying to do to help clear their records with the hope that if they need any type of social services like resume-building, references for a job, workforce support, help to understand where to go look for [a job], health-care options, housing options …[what] we all need in regards to just being whole and being able to contribute to society—we want to offer that by having a full-time case manager who can … track them from the time they go in through our expungement program,” McCarthy says.
Cannabis providing a refuge for some communities.
In early March, Kobie Evans and Kevin Hart opened Pure Oasis, Boston’s first adult-use dispensary and Massachusetts’ first minority-owned cannabis business. They received priority review for meeting Massachusetts Cannabis Control Commission’s “economic empowerment” criteria, such as setting up shop in an “area of disproportionate impact.”
Evans’ experience provides a glimpse at how aggressively policed areas during prohibition now allow legal cannabis business in those same communities. Growing up in Boston, Evans says police would “stop and frisk” him.
“They could stop you at any point, detain you, frisk you, assault you with impunity,” he says. “My story isn’t different than millions of other young black men. So, I don’t call myself a victim or act in a way as if I’m different from anyone else. It’s just a normal course of growing up in Boston and many other cities. Someone has to be the bad guy, and a lot of times, it ends up being a person of color—a young black man.”
Evans says the name Pure Oasis was inspired in part by the goal of providing a “sanctum” for people in Boston’s Dorchester neighborhood, where the 2,500-square-foot dispensary is located. More than 700 people came through on the business’s first day, March 9. Many of the sales that first week were of flower, Evans says, although Pure Oasis offered a broad assortment of products.
“We wanted to create a space for people in the neighborhood to come and be treated with dignity, with respect, with value,” he says. “In that instance, we wanted to create an oasis, where if you look in subsidized housing, and you look below the poverty line, but you wanted to come and buy something and feel like your dollar was valued, then, A, we wanted to create an oasis for you; and then B, we wanted to celebrate a product that is very organic and very natural and very pure.”
On March 23, to halt the coronavirus spread, Massachusetts Gov. Charlie Baker ordered adult-use dispensaries to close from noon EST March 24 until noon EST April 7. Evans said he understood that the governor’s response was in the public interest, but that the easiest solution for improving equity opportunities in the industry during this time is for states to deem all cannabis businesses essential.
Many customers using cannabis for medical reasons purchase in the adult-use market, Evans says. When Pure Oasis closed its doors on March 24, he says a customer approached him to share they were buying cannabis from Pure Oasis for their post-traumatic stress disorder.
“We’re going to buy today, we’re in jail today, so why can’t we have equity today?” Jason Ervin, 28th Ward alderman and chairman of Chicago City Council’s Black Caucus
“He applauded the fact that he can have access to a broad selection of product at our shop, but now he’s going to have to go back to the black market, and that’s reality,” Evans says.
As adult-use social equity programs come online, like those in Massachusetts and Illinois, McCarthy says she doesn’t want people to lose sight of cannabis’ medical benefits.
McCarthy wrote grants for the hospice and end-of-life industry. When she was writing them for Federally Qualified Health Centers, she used the Health Resources & Services Administration’s Medically Underserved Areas and Populations database to see which zip codes were medically underserved. “It would always be communities of color,” she says.
As scientists conduct more research into the medical benefits of cannabis, such as the effects of specific cannabinoids and terpenes, and work to improve patient outcomes through existing medical dispensaries, there’s a chance to better serve communities of color, McCarthy says. Dispensaries could carry cannabis medicine tailored to addressing specific conditions such as diabetes and cancer, which are prevalent in minority communities.
McCarthy also suggests that states could open pathways for social-equity applicants to open dispensaries in existing markets.
In addition to discussions about social-equity ownership in Ohio’s program, other conversations about medical programs continue, such as in Pennsylvania, New Jersey, New York and Florida. In Florida, M4MM is working with legislators on items such as setting up expungement fairs. On the West Coast, San Francisco’s Office of Cannabis requires equity plans from medical dispensaries in the city.
McCarthy believes advocating for social equity in the medical market is important because when federal legalization happens, legislators will prioritize the medical benefits of cannabis over adult-use. And Medicaid may end up being able to reimburse some purchases for people who need medicine, she says.
“They need to have something that’s in their community, that’s going to baby-step them a little bit, that’s going to show them the way, and also maybe reimburse them for their medicine,” McCarthy says. “It’s big thinking, but we need to be thinking big, and we need to be thinking long-game versus what we see tomorrow.”
New Mexico Gains Ground
Departments - Fast Stats
The state registers more MMJ patients than Colorado.
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