A key principle of Illinois’ efforts to legalize recreational cannabis was to use the opportunity to help correct harms caused by the war on drugs. One of the ways the state sought to do this was by giving those from disadvantaged communities preference for dispensary licenses. Illinois promised to award 75 dispensary licenses last summer, but when all was said and done the state only chose 21 firms, the majority of which were owned by the white and politically well-connected. Not a single minority-owned business was awarded a license. This was attributed to a clause in the application scoring process that awarded social equity “points” to applicants that promised to hire minorities. Heavy criticisms about the scoring process followed. Some of the minority applicants invested upwards of $80,000 in consulting fees related to their applications and have filed lawsuits against the state. Now, the state is electing to redo the entire process to give another chance to minority applicants.
“Our state is a leader, putting forward the most equity-centric cannabis legalization in the nation.”
-Governor of Illinois, JB Pritzker
There is big business in cannabis sales. Sales in Illinois alone are expected to surpass $1 billion annually. The dispensaries in Illinois that are currently allowed to sell cannabis for adult-use (recreational cannabis) are those that possessed medical cannabis licenses. The licensing process for medical cannabis in the state had extremely high financial barriers to entry and the licenses were awarded years prior to Illinois’ effort to legalize adult-use. So not only are applicants losing the investments they spent on consulting fees related to their applications, but they are also losing (potentially) millions of dollars in opportunity costs.
Now that New York has passed legislation permitting the adult-use of cannabis (the MRTA), all eyes are on the state and its new office of Cannabis Management to see if New York can get it right regarding social equity. Surely, black and minority entrepreneurs deserve an opportunity to make a livelihood off of what was once a criminalized industry that operated (and continues to operate) right in their own communities. The prohibition of cannabis led to a highly complex and prevalent cannabis trade (not unlike alcohol prohibition) that has had a lot of negative consequences. The criminalized cannabis industry contributes to the prison industrial complex. It leads to unnecessary harassment by police and other law enforcement. It leads to imprisonment, absenteeism, violence, death, and a cycle that perpetuates itself. When this industry is legitimized and legalized the benefits are many. It increases public safety, not only because regulated products are safer for consumers, but because the communities become safer and the illicit market for cannabis becomes less lucrative. Prohibition of drugs (not just cannabis) is what makes them expensive and why selling them is lucrative in the first place.
I truly hope New York can be a model for social equity in cannabis on the East Coast, and that Buffalo can be a model within the State for how the social equity aspect of the program gets operationalized. We will see what happens in the coming months. Many of us will be watching closely, hoping our State can capitalize where Illinois fell short.