Connecticut’s Social Equity Council approved the state’s income and residency requirements for prospective adult-use cannabis business applicants on Dec. 7, but fell short of starting the clock for when applications can be submitted. The Council opted to delay final approval on its technical assistance accelerator program so that it can find a consensus on its details at an as-yet-unscheduled special hearing.
“This legislation is an ambitious, yet imperfect product,” said Council Chair Andrea Comer at the beginning of the meeting. “The timeline was aggressive, given the charge, and in order to do this the right way we may not have hit every goal post at the requisite moment.”
The Council approved income and residency requirements for applicants, but with the stipulation that approval was contingent on the state Department of Consumer Protection increasing the initial application window from 60 to 90 days. That window would start 30 days after the council approves the technical assistance program.
Under the approved income and residency rules, social equity applicants must live in one of 200 Census tracts in the state that were designated as “disproportionately impacted areas” (DIAs) based on unemployment and historical drug conviction rates. The state has a total of 883 Census tracts, and the assigned DIAs include 35 municipalities.
Local residency requirements have attracted a great deal of scrutiny in federal courts, and been stricken down in cases in Maine, Michigan, and Missouri.
Members of the public who testified during the hearing, spoke out against the Council’s focus on geographic areas for social equity status.
“I personally live 500 feet away from an area that qualifies,” said Bridgeport resident Andrew Allen. “Every area surrounding my area qualifies as a DIA. to say that my neighborhood is not in the DIA would be false. I have personally been prosecuted for cannabis multiple times. A lot of people in these areas don’t have the money for this business. We obviously won’t have access to major banking or private investment.”
Tyler Crespo, who said he left his home state of Connecticut years ago to open a medical caregiver cultivation site in Maine, agreed that the DIAs were not large and he argued that the income caps would restrict who could afford the start-up costs for a cannabis facility.
“These areas don’t span wide enough to accurately reflect the effect prohibition has had on our state,” he said. “The financial cap of annual income creates an unrealistic barrier to enter the market.”
Businesses applying for social equity status must be at least 65% owned and controlled by individuals whose incomes over the last three years each averaged less than 300% of Connecticut’s annual median household income. The state’s median household income was $78,444 from 2015 to 2019, according to the U.S. Census, making the household income limit for applicants about $235,000 a year.
That means in order to qualify toward the minimum of 65% ownership stake holders cannot have made more than about $235,000 a year.
The Council also approved the criteria for applicants’ Social Equity Plans and Social Equity Workforce Plans. These will serve as guidelines for social equity applicants in terms of the material that must be submitted prior to the approval of a final license.
Although the meeting was intended to confirm a series of requirements for social equity applicants, several patients from the state’s medical cannabis program took to the hearing’s public comment portion to voice concerns over testing standards.
“Recently there were photos posted to social media from multiple patients holding moldy cannabis,” said Adam Lewis, a medical cannabis patient. “Then there are warnings of products testing dangerously high for mold with numbers that would have failed before target maximums were raised via emails and whispers by people who have little to no scientific understanding and even less compassion for the patients.”