In California, cannabis equity programs are designed to help individuals in communities of color who have been disproportionately impacted by incarceration from the “War on Drugs.” They give equity applicants, or potential small business owners, the opportunity to access financial incentives, business support and mentoring to participate successfully in the burgeoning legal cannabis industry. San Diego is moving forward slowly but surely with its own program, even though California’s Bureau of Cannabis Control announced a $10 million stash box designated for Cannabis Equity Grant Programs (as part of the California Cannabis Equity Act) with an April 1 deadline that San Diego didn’t meet. However, San Diego Councilmember Christopher Ward recently broke the San Diego equity program silence on KUSI News with conversations about an equity program proposal to be presented to the full San Diego City Council this spring.
San Diego is looking to cities like Sacramento, Los Angeles, Oakland, San Francisco and San Jose, as they roll out their respective cannabis industry equity programs. Equity programs in other cities seem to be closely connected to other issues like the number of available licenses and license types, the black market, zoning and economic stimulus and impact.
Oakland is the only jurisdiction to have a fully operational cannabis equity program, with four of the city’s 16 dispensary licenses mandated to be equity-owned. San Francisco has started the process, mirroring Oakland’s program, deciding equity-license holders do not have to pay the city’s $5,000 permit fee and can get three years of rent-free space or technical assistance to run their businesses. Meanwhile this March, San Jose voted on its cannabis equity program, which has been determined to be unable to be implemented without an increase in cannabis licenses.
San Diego Councilmember Ward shared that he believes the San Diego cannabis industry is going pretty well, but cannabis license holders are disproportionately wealthy and white, and that the industry ought to be more accessible to equity applicants. Per Councilmember Ward, San Diego’s next step is to model Sacramento’s recent example by conducting a needs assessment with prospective business owners from within the industry. Aware of the financial challenges of equity applicants seeking to open a dispensary, Councilmember Ward also explained on KUSI, “You need upwards of a million dollars sometimes a little bit of seed money can go a long way sometimes just even $10-20K in fee deferrals can help them get going.”
Adolph Ward is an architect of Oakland’s equity program, and Chair of the Oakland Cannabis Business Council. Adolph shared with CULTURE how it’s important for cities to allow cannabis business license types that are realistic for equity applicants to obtain, “In many cases, equity applicants won’t have the financial liquidity of $1 million to open a retail storefront, so Delivery and Type 6 Manufacturing licenses are where the average equity-applicant needs to hang their hat. You can open a delivery service for $100,000 or less, not $1 million,” Adolph shared. “Cities slow to legislate are harming the industry, themselves and equity applicants. Money is on table, and it’s a missed opportunity. It’s time to act fast because unregulated operators are taking the market share.”
“Cities slow to legislate are harming the industry, themselves and equity applicants. Money is on table, and it’s a missed opportunity. It’s time to act fast because unregulated operators are taking the market share.”
If San Diego were to designate delivery licenses for equity applicants, it needs quickly acquire some of California’s limited 311 active delivery licenses (notwithstanding micro-permits) statewide. Oakland currently has the vast majority of them—about 120, Sacramento has about 60 and San Francisco has about 30. Many California cities have just one two or three. San Diego has none.