US: "Social equity policies could shape diversity in the cannabis industry"

In the United States, less than 20 percent of legal cannabis business owners and founders are minorities. This reality, combined with the negative consequences of cannabis prohibition on minority communities, has led many advocates to call on elected officials to address this disparity. With legal cannabis projected to meet over 40 percent of our country’s annual demand by 2025, the policies state lawmakers choose to implement over the next few years will likely play a significant role in the makeup of this quickly expanding and highly profitable industry.

While there is no one solution to promoting a diverse and healthy cannabis market, some states with legal cannabis have enacted various social equity policies with varying success. Though different in each state, most of these policies seek to address criticisms that the legal cannabis industry is profiting from the same substance that put many Americans from historically underserved communities behind bars.

For example, in Illinois, where cannabis became legal in 2020, lawmakers passed a provision prioritizing dispensary and grow licenses for applicants who meet specific social equity criteria. Applicants previously arrested or convicted for an expugnable cannabis-related offense, business owners who employ those previously arrested or convicted for such an offense, and residents who live in designated communities disproportionately affected by these types of arrests and convictions, are all eligible.

More recently, in early March, as part of the state’s new Seeding Opportunity Initiative, New York made the decision to grant its first couple hundred dispensary licenses to residents who have been convicted of cannabis-related crimes. This effort aims to give communities that have been negatively affected by cannabis prohibition an avenue into the state’s promising multi-billion-dollar legal cannabis industry.

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