Racial disparities in cannabis loom large, while MSO-driven social equity efforts work at the margins

African Americans are still more likely to be arrested for marijuana possession than white people in every state, including states where marijuana is legal, according to the American Civil Liberties Union (ACLU).

While African Americans are being arrested and serving time for marijuana possession, the cannabis industry is dominated by rich white men who can afford the exorbitant fees it takes to apply for a license and build out cannabis businesses, retail dispensary owner, cultivator, processor, or tester.

Social justice activists and organizers see the twisted scenario as “absolute” injustice and would like to see more being done to correct it.

According to data the ACLU collected from 2010 to 2018, that looked at arrest data by state and by county across the country, Black residents were 7.5 times more likely to be arrested for marijuana possession than a white resident.

“The same thing you have young have Black men going to jail for and being removed from their homes, not being able to raise their kids, they’re now watching rich white men come into the same neighborhood on the same corner and selling legal marijuana because they [can afford the millions of dollars it takes] to get a company started,” said Ohio cannabis activist Tasha Rountree.

She and other groups would like to see cannabis business owners take corrective actions to right what they say is clearly wrong. They say while marijuana arrest record expungements are a good step in that direction, a lot more needs to be done.

“They should be making the licenses cheaper, making expungement automatic sooner, and they should be actively creating employment opportunities in all levels of their company for people who were disproportionately criminalized by marijuana prohibition,” said Denavvia K. Mojet, founder and executive Director, Black & Brown Cannabis Guild.

They should be supporting the work of the Black & Brown Cannabis Guild as members, sponsors, donors, partners, and allies. 

Cresco was great to work with because Mykel Selph and Michael Thompson were true partners.

In an effort to demonstrate support for social equity Cresco Labs partnered with Bonita Money, founder of The National Diversity and Inclusion Cannabis Alliance (NDICA) last summer for a “Summer of Social Justice” expungement event in Ohio.

“We were overwhelmingly busy with 280 people, and we could not service them all,” Money said. “We had to hold another clinic to service those left out of the first round. “This just showed us that those services are not being provided in Ohio which is problematic because a lot of folks are sitting with these barriers to entry, having these criminal records, so it’s a problem.”

Money added that Ohio is just now beginning its recreational licensing process but still lacks a comprehensive social equity plan.

“You have a couple of Black and Brown operators in Ohio,” she said. 

A June 2020 report issued by the State of Illinois in February showed that fewer than 2% of dispensary licenses were Black or Latino owned. Little has changed with license ownership in the state since then, since so few new licenses have been issued.

According to The State of Ohio Board of Pharmacy, which oversees medical marijuana retail dispensaries, there are only four African American-owned dispensaries in Ohio.

In some cases, predatory investors take ownership control of minority-owned dispensaries through sharply-worded operating agreements, something Money said is a problem nationwide.

“Some companies are asking for social equity borrowers to pay their loans back or they’ll be sent to collections which means licenses are being held hostage because they were given loans and not grants,” Money said. “These folks are already struggling and now they are faced with being sent to collections. This is ridiculous to me. Their resources are scarce and so many people are struggling because of these criminal records.”

Attorney’s fees alone can run as high as $1,000, an astronomical figure for those struggling financially, she added.

The “trickle down” impact of having a criminal record based on marijuana arrests, sets up barriers to things like employment, housing, and essentially can be described as a form of oppression.

Chima Enyia, Cresco Labs’ Executive Vice President of Social Equity and Educational Development, said the company launched their expungement program as a component of the company’s core values, one of which he said is social equity.

“The company cannot lose sight that more than 40,000 individuals are currently incarcerated due to the ‘The War on Drugs’,” Enyia said.

Cresco’s expungement effort was staged in 10 states across the country. The company raised more than $250,000 and served more than 1,000 people at expungement events.

Rountree served as a community liaison with NDICA for Cresco’s event.

“When those rich guys get those dispensaries, we can’t even get a job and work (there) because you can’t work and have a felony on your record (even as a budtender). The expungement efforts allow us to help them clean up their record and send them to school so that they can get a legal job even if they can’t own a dispensary,” Rountree said.

A next level equity effort would include more Black and brown individuals having a seat at the company board table in leadership roles.

“By no means have we attained where we want to be, which is to be diverse in every way but not only diverse in personnel but also having a diverse supply chain,” Enyia added.

The situation is two-pronged in terms of the industry, said Chris Jackson, part owner and GM of “Sticky Ypsi” dispensary in Ypsilanti, Michigan who also sits on the state’s Social Equity Advisory Board. The first thing is people of color, African-Americans in particular, have been disproportionately, negatively impacted by the War on Drugs.

Cresco’s more than 1,000 expungements is a good start, Jackson said.

“I would also say that it’s not incumbent on one company,” he added. “It should be incumbent on the entire corporate community to continue those efforts. For anyone to say that’s not enough, the question would be, ‘What are you doing?’”

“It’s not just about the expungement itself, which is generally the more expensive process, but also the other wrap-around services, access to employment, access to other resources, programs, friendly employment terms for folks who have criminal records,” Jackson said.

The other side of the equation is allowing for equitable opportunities.

“Giving people the opportunity to exist as business owners and entrepreneurs within the cannabis industry is as important in my opinion as giving the opportunity for freedom, related to the cannabis industry because of laws or legislation that either existed and/or didn’t exist but exist now.”