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Green Rush: California’s Belated Effort to Create Equity in the Cannabis Industry

At the age of 17, Daniel Montero began smoking and selling marijuana full-time in California. Even near-death encounters and two prison sentences for felony marijuana charges didn’t dissuade him. “It’s not just about getting high. It’s a green renaissance.”

Montero is a first-generation American and survivor of the war on drugs. But after California’s recent legalization of marijuana in 2018 under the state’s Proposition 64, his business is now illegal. Montero is now considered a “legacy operator”—a cannabis businessman with previous experience in the industry. He is an avid enthusiast of “cannabis culture,” the chair of the San Jose Cannabis Equity Working Group, and a skilled community organizer in the rapidly expanding industry. 

In the past year, businesses have invested millions of dollars into opening hundreds of marijuana shops in California’s modern-day equivalent of a gold rush. The media has heralded legalization as a policy win for racial justice due to its radical departure from the former “tough on crime” drug policies that criminalized marijuana use. However, some fear this praise risks erasing the oppressive history of the war on drugs. 

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Former U.S. president Richard Nixon is notorious for  declaring this “war on drugs.” As executive, Nixon created the U.S. Drug Enforcement Agency, responsible for tackling drug use and smuggling; dramatically increased federal drug agencies’ presence in communities of color; and issued no-knock warrant policies, which give absolute authority for police officers to force entry. 

President Ronald Reagan zealously upheld Nixon’s anti-drug legacy by increasing mandatory minimum drug sentencing. Incarceration skyrocketed during his presidency, disproportionately for black people, the majority of whom were nonviolent offenders.

Despite the lack of any scientific proof, marijuana was demonized as a highly addictive “Schedule 1 Drug,” more dangerous than cocaine or fentanyl. Under the Clinton administration, Congress passed the Violent Crime Control and Law Enforcement Act of 1994, which dramatically increased prison funding and instituted a three-strikes rule: Anyone convicted of a violent crime who had two or more prior convictions, including drug crimes, was sentenced to life in prison. 

California’s law enforcement followed suit. From elected officials to school administrators, those in positions of power were similarly staunch in enforcing zero-tolerance drug policies. In the 1980s, Los Angeles Police Chief Daryl Gates intentionally targeted black and brown communities in drug raids and strongly advocated for harsher penalties. In a 1990 Senate Judiciary Committee hearing, Gates boldly testified that “casual drug users should be taken out and shot.”

Between 2000 and 2010, a person was arrested for marijuana possession in the United States every 37 seconds. In total, eight million Americans have been incarcerated for marijuana-related crimes, with 88 percent of those incarcerations only related to possession. But as prisons remain overcrowded and the racialized consequences of the war on drugs become strikingly apparent, public sentiment toward marijuana use has shifted. Colorado was the first state to legalize recreational marijuana use. Ten additional states, including California, followed suit in years afterwards.

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Adam Bierman, CEO of MedMen, will tell you that he does not “run pot shops.”

 The assertion at first is startling: MedMen, one of the nation’s leading legal marijuana dispensaries with over 36 physical stores, is an influential presence in seven out of the ten states with marijuana legalization. 

It’s all part of the goal. Bierman prides himself on destigmatizing marijuana—his strategy is to market to the untraditional demographics of “chardonnay moms” and “nine-to-five dads.” 

The moment you walk into a MedMen store, you’re greeted with the luminescent glow of glass cases perfectly positioned on sleek tables. Alluring adjectives like “euphoric,” “uplifted,” and “elite” denote the effects of different marijuana strains. This Apple-store-like space, satisfyingly arranged with clean-cut, colorfully labeled marijuana strains and gleaming vaporizers, seems worlds away from California’s recent history of criminalization and harsh incarceration.

Political commentator and author Solomon Jones reminded readers of the ever-present effects of California’s demonization of marijuana use in his Philadelphia Inquirer article: “Legalizing marijuana is the same kind of economic bait-and-switch that America has always pulled on people of color,” he argued. “Blacks create an industry that has value—whether through legal or illegal means—and white folks change the rules, change the language, and change the perception in order to bring about a change in ownership.” 

This “economic bait-and-switch” is glaringly visible in the current demographics of legal marijuana business ownership. In the most recent survey by Marijuana Business Daily, white people like Bierman own 81 percent of new marijuana businesses. In contrast, fewer than five percent of marijuana businesses in the United States were owned by black people. In a devastating irony, between 2000 and 2010, black people were 3.73 times more likely than white people to be arrested for marijuana, despite roughly equal usage rates. 

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Historically,  California’s three major counties of Los Angeles, San Francisco, and Long Beach were home to a disproportionately high number of marijuana arrests. Today, these counties boast the highest concentrations of legal marijuana businesses.

These counties recognize their history, and their Departments of Cannabis have designated zip codes—“disproportionately impacted zones” based on past high rates of cannabis convictions—for specific social services. In these zones, more than 90 percent of residents are people of color and more than 80 percent are low-income. 

Rarely do these residents participate in the new, legal economy.

Many prospective business owners have a criminal record, making it difficult for them to sign even a reasonably-priced lease. Although California recently passed AB 1793 to expunge marijuana criminal records, in many other states, felons are forbidden from attaining a retail marijuana license, even if their convictions are marijuana-related.

 It costs at least a quarter of a million dollars to start a marijuana business, and there are no federal bank loans available. Prospective business owners must navigate the legal jargon of multiple permits and extensive building and facility inspections, which can quickly become expensive. 

To counter this inequity, the three counties have instated “Cannabis Social Equity Programs” with the mission to “promote equitable ownership and employment opportunities in the cannabis industry, focused on those hit hardest by the War on Drugs.” They offer public application workshops, priority applications, and fee waivers for licensing and business permits.

Los Angeles County’s Department of Cannabis assigns different benefits to individuals through a three-tiered system based on their length of residence in a disproportionately impacted zone and past record for marijuana-related crime. Tier 1“equity” applicants access the most benefits, including licensing fee deferrals and access to a newly established “industry investment fund” to assist in startup costs. 

All legal cannabis businesses in San Francisco must also provide a “community benefits agreement” policy in which they detail employment opportunities for those affected by the drug war. For example, Barbary Coast Dispensary, which provides public employment fairs in disproportionately impacted zones, is frequently co-sponsored by the San Francisco Department of Cannabis. In addition, the Department’s staff recently toured the San Quentin State Prison to discuss thoughtful drug policy with inmates.

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Now that California has legalized recreational marijuana, the trajectory of the industry’s influence and growth in the state is unclear. In an interview with The Politic, Angie Maina, Program Specialist of the Long Beach Department of Cannabis, described this uncertainty as the “most difficult part of the [department’s] job.”

Social Equity LA is a non-profit organization that hosts bilingual Spanish and English workshops to provide legal and technical assistance for potential marijuana business owners. In an interview with The Politic, co-founders Adriana Gomez and Luiz Rivera detailed the challenge Maina acknowledged. Their organization has facilitated one-on-one training for applying for licenses, making sure that their “boots were on the ground, [by] holding candidates’ hands and making sure that they were not left behind.” Gomez stressed the reality that “making policy does not necessarily mean people have access to it.” 

As other states consider legalizing marijuana, many look to California’s attempt at reconciling the history of the war on drugs with profitable, safe, and accessible marijuana businesses. “As we move forward with legalization, we need to start from the bottom up,” Gomez reflects. “How are our communities of color being left behind? We need to make sure that in ten years we don’t regret this.” 

Social Equity LA’s mission for community investment is shared by Cage-Free Cannabis, another Los Angeles-based organization focused on social responsibility in the cannabis industry. In an interview with the The Politic, co-founder Adam Vine reflected on how incredibly nuanced the cannabis industry is and how it is “easy to lose sight of the humanity at the core of this issue.” Cage-Free Cannabis has launched an annual “National Expungement Week” when they offer legal relief, voter registration, health screenings, employment workshops, and other services in addition to their usual work helping individuals expunge their criminal records. 

Vine believes that the biggest challenge behind city-sponsored cannabis social equity programs is the lack of financial support from city and state government. Cage-Free Cannabis and similar organizations are “trying to fill in the gaps and provide the services that aspiring cannabis retailers need.” Vine is excited for the growth of National Expungement Week: “You can expect to see the week continue to grow,” he explained. “These people need legal relief and opportunities to enter the industry.” 

While the uncertainty of the legal marijuana industry can be a formidable obstacle, Maina acknowledged that “it has been rewarding to regulate a brand new and emerging industry, while thinking hard on how to connect with other cities and our own community for the best and most fair practices.” 

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“You often glorify the criminal lifestyle,” Daniel Montero admitted. “But surviving bullets, robberies, parents being killed, families being killed…. It’s a lot. It’s not glorifying at all.” Despite the cannabis industry’s ambiguous future, some positive effects of marijuana legalization are undeniably clear.

California’s legalization of marijuana has been “so humanizing” for Montero because he’s now able to openly promote the cannabis plant he “loves.” But in California’s efforts to regulate the new and highly profitable marijuana industry, Montero reminds us that “there is no point in building a mansion if the foundation is not correct.” That foundation must exist in marijuana equity.

Marijuana equity is especially important when considering what Montero describes as marijuana’s “tip of the iceberg” of opportunities. He notes the diverse uses of cannabis, some of which include effective pain treatment (CBD in the pharmaceutical industry) and sustainable building development (industrial hemp in the construction industry). 

But the question of this equity in California’s green renaissance still remains. As the chair of the San Jose Cannabis Equity Working Group, Montero advocates for permanent funding in cannabis equity programs. He recognizes that policies fail to matter if “there is no money to put it in play” and will continue “making sure the money generated [from the cannabis industry] is going to the right places.” 

Montero reminds us that building these businesses is not just about getting high, but rather about expanding opportunities for all communities. “I can die happy if I can continue this work. Equity is about giving opportunity to those of us disadvantaged by the war on drugs,” he declared. “It’s about our mothers, brothers, and sisters who’ve also suffered a domino effect from this war. Equity is to empower our people through cannabis.”