Are Cannabis Social Equity Programs Truly Equitable?

Since 1996, when California voters approved Proposition 215 to legalize medical cannabis, over 37 states have followed suit with legalized medical and/or recreational cannabis policies. California is the largest contemporary cannabis market, and as such it offers a window into a new arena of drug policy: social equity programs. Cannabis social equity policies are meant to remedy the harms of the ongoing War on Drugs, a federal campaign that sought to combat illegal drug use through increased penalties for offenders. Social equity programs aim to provide opportunities to traditionally disenfranchised and over-policed communities of color. Social equity programs often explicitly discuss inequities of race and place. However, social equity policies have yet to benefit women, queer, and transgender people.

Cannabis Social Equity Policy 

Social equity programs frequently invoke the devastating impact of the War on Drugs on communities of color to situate their lofty goals for redress. The War on Drugs was a campaign by federal and state governments, amplified through mass media, that led to the incarceration of millions of people of color for possession, distribution, and use of cannabis, along with other substances.

Women—often poor mothers of color—have carried the financial burdens of family responsibilities because men of color were disproportionately targeted by the War on Drugs. At the same time, there has been a 216%  increase in drug-related arrests among women over the past 35 years.

The criminalization of drugs, including cannabis, has had profound economic and psychological, generational effects among families and communities of color.

In 2016, California passed Proposition 64, “The Adult Use of Marijuana Act,” which legalized marijuana and regulated its cultivation, sale, and use. Prop 64 included social equity programs to ensure historically disadvantaged communities have a chance to enter and benefit from the formal cannabis industry. The mission of social equity programs such as the City of Los Angeles’s, is to promote “equitable ownership and employment opportunities” in the new legal marijuana industry. While California offers grant funding to local jurisdictions that choose to implement social equity programs, local governments are not required to do so.

Social Equity in Practice

There are three major governmental approaches to social equity in the cannabis industry: expungement of past cannabis convictions, licensing and employment preferences, and using tax revenue for equity. The expungement of past convictions is important because a “drug-related criminal record carries life-long consequences,” and blocks people’s entry into the cannabis industry. As part of the 2018 AB1793 law, California offers automatic expungements for certain qualifying cannabis convictions. A second aspect of cannabis social equity programs is licensing and employment preferences that prioritize communities negatively impacted by the War on Drugs. However, preferential licensing programs have not lived up to their expectations. Once an applicant receives a license, they need about $250 000 to start a cannabis business. Social equity applicants without financial capital, especially women of color who already earn less, find they cannot utilize their licenses. Without small business financing, preferential licensing programs in cannabis public policy perpetuate inequality.

Nationally, almost 85% of cannabis ownership is white, with non-white owners comprising just over 15% of the market.

Cannabis social equity programs aim to use tax revenue for social equity. This means a percentage of tax revenue from recreational cannabis sales is allocated toward benefiting communities impacted by cannabis prohibition and criminalization. One way cannabis tax revenue is redistributed in California is via funding a program that aids local jurisdictions’ equity applicants and licensees with regulatory compliance assistance, assistance with securing capital, and technical support, totaling fifteen million dollars. In addition, the California Community Reinvestment Grants Program grants awards to local health departments and qualified community-based nonprofit organizations that directly work with communities disproportionately impacted by past federal and state drug policies. Funding supports efforts such as legal services, job placement, and mental health and substance use disorder treatment.

Cannabis social equity provisions can be seen as a form of racial reparations, by transferring wealth to those most ravaged by racial capitalism and over-policing.

Allocating tax revenue to these communities is especially critical as cannabis zoning policies have led to a concentration of cannabis dispensaries in poorer areas; if these communities are home to these businesses, they should reap rewards. Without social equity provisions, the “green rush” will continue to reproduce racial and class inequities. 

Gender Equity in Cannabis Policy

However, California’s social equity programs do not account for gender equity.

As of 2022 women constitute only 23.1% of executives and 22% of ownership in the cannabis industry. As well, only 11 out of 105 social equity retail licenses issued by the Los Angeles Department of Cannabis Regulation are operating businesses, and of these, only 4 are women-owned.

While there is less data available, some reports have found that LGBTQ+ people are underrepresented within the cannabis industry. The lack of LGBTQ representation is startling, given that LGBTQ communities paved the path to medical marijuana legalization as part of their fight to provide holistic, alternative care during the AIDS crisis. The lack of gender and sexual diversity in the industry is not due to a lack of interest or experience but is the result of public policy decisions that have favored corporate companies. Women and queer people have long struggled to climb the corporate ladder, and the cannabis industry is no exception.

Anecdotal evidence suggests that women working in the cannabis industry, like other retail and low-wage workers, encounter sexism and harassment. For example, Latinx women who worked at a downtown Los Angeles non-regulated dispensary walked out in protest of harassment and discrimination by the owners. Women are pushing for greater power in the industry by creating mentorship communities, such as Women Employed in Cannabis Community Center, and media, such as the podcast Women Leading in Cannabis. Women like Christine De La Rosa, owner of The People’s Dispensary in California, started a fund to invest in women and BIPOC-owned businesses in the cannabis industry. Gender equity, along with race and place, needs to be a factor in social equity programs.

Moving Forward with Cannabis Social Equity

Cannabis legalization is an encouraging development, but more must be done to address systemic inequity and discrimination in the cannabis industry and its impact on surrounding communities. Policymakers can better incorporate gender, along with race and class, in social equity programs by:

      Decriminalizing cannabis on the federal level by removing it from the Controlled Substances Act, and eventually legalizing it. Doing so will remove barriers to the banking industry and promote uniform policies aimed at redressing the harms of criminalization.

      Increase collaborations and funding for comprehensive, nationwide Cannabis Equity Assessments to evaluate and continuously improve existing state social equity programs.

      Provide free business consultations tailored to communities of color, women, and LGBTQ people.

      Mandate diversity and inclusion training as a component within existing social equity programs to equip business operators to hire and promote women and LGBTQ people in the industry.  

There isn’t one way of remedying the harms of the War on Drugs but cannabis social equity programs that intentionally address inequalities of gender and sexuality, along with race and class, could mitigate disparities.

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