Right out of the gate we’ll say that the exact number of minorities in Michigan cannabis businesses is unknown.
That’s because when the marijuana law passed in 2016, the state wasn’t required to keep track of the demographics of the people who get licensed in the industry.
And since state law bans affirmative action programs, there were no concessions made for medical marijuana licenses for minority communities.
But it’s estimated that of the 233 licenses given by the state, only a handful have been awarded to minorities. A small handful.
And in Detroit alone – where 80% of the population is African American – just a couple of the 24 or so licenses were awarded to black business owners.
Why the Lack of Minorities in Michigan Cannabis Industry?
There are a number of reasons.
“The biggest barrier for minorities is the capitalization requirement,” says Barton W. Morris Jr., an attorney with the Cannabis Legal Group in Royal Oak.
In fact, to gain entry into the industry, business owners better be ready to shell out $6,000 for the state application fee, $66,000 for state regulatory assessments, another $5,000 for the local municipality application, and then offer up proof of $200,000 in assets.
So it’s no surprise that most of Morris’ marijuana-related clients are white men who have a distinct advantage in the industry.
These limitations have made it virtually impossible for many minority entrepreneurs to even consider the cannabis industry.
One such person was Margeaux Bruner – who is now the political director for the Michigan Cannabis Industry Association, a Lansing-based advocacy group for the marijuana industry.
When she started researching what it would take to get a license for a marijuana business, she quickly recognized all of the hurdles she’d have to clear.
“I understood very early on that I wouldn’t qualify. Number one was the capital requirement,” she said.
Her desire to be involved in the industry is what drove her to her current position though. And from that vantage point, she sees clearly the obstacles the African American community and other minorities face in the industry.
Minority Success Stories Are Few
Christine Montague and her daughter, Teesha, own the Huron View medical marijuana dispensary in Ann Arbor. They were able to get a license from both city and state officials.
But it was far from easy.
To come up with the capital, Christine cleared out her 401(k) and refinanced her house. When she attempted to network with cannabis business colleagues to share things like transportation costs, she didn’t feel terribly welcome.
“Most of them are struggling like us,” she acknowledged. “And most of them have partners, but none are African Americans. I feel like I’m a trailblazer, but it’s just a very hard business for minorities, and particularly minority women, because people think they can bully you.”
And if you’ve opened up a MetroTimes recently, you’ve probably seen ads for BotaniQ. It’s a dispensary in Corktown owned by Anqunette and Richard Sarfoh.
Anqunette Sarfoh was a well-known black news anchor in Detroit. Yet even she and her husband had a difficult time getting into the dispensary business.
When they were initially searching for properties in Detroit’s green zone (i.e. areas at least 1,000 feet from schools, parks and churches), investors from out of state had already snatched them all.
So they eventually had to settle for a building with a 100-year lease that renews every year. And, of course, it increases. (We’re talking Corktown, after all.)
She has also found it difficult to attract African American employees. “In our community, cannabis use has been stigmatized, because of how the legal impacts have affected our community,” she said.
“In some communities, kids can go in a cornfield and smoke a joint and go on about their lives. But in our communities, what happens when you’re caught, your future is gone,” she continued. “And so for the longest time, you just don’t even touch it and and you grow up knowing that it could ruin your life.”
Still Waiting on Expungement
Morris notes that along with the monumental task of raising enough capital, there are minorities who are left out of getting into canabusiness because they’ve been convicted of marijuana offenses.
Research shows that arrests for marijuana offenses have gone down dramatically in states that have legalized marijuana for adult recreational use.
Even so, African Americans are still arrested 2.5 times more often than white folks for simple possession – in spite of similar rates of marijuana usage.
“There’s no question that the majority of people I’ve represented for simple, nonviolent offenses are minorities,” Morris said. “And that has ruined lives. And there is nothing that’s been done to remove that from their records.”
Of course, he’s right.
Despite the fact that other states such as California, Oregon, Colorado, Maryland and New Hampshire have made it easier for people to get their past marijuana convictions erased or sealed, that isn’t the case in Michigan.
Although Whitmer and Nessel support expungement, no hearings have been held and, as of this date, the governor has not moved to pardon marijuana crimes.
It’s all very unsettling.
The Need for Social Equity Programs
Something’s gotta give.
When the 2016 law was passed to regulate and tax medical marijuana, it didn’t include any social equity language. So no considerations were made for the 233 businesses that received licenses for the medical market.
And those same 233 businesses are first in line for licensure on the recreational side.
So Michigan’s Marijuana Regulatory Agency (MRA) announced their social equity program details on July 18th, 2019.
This program is designed to encourage participation in the marijuana industry by people residing n 19 Michigan communities which were disproportionately impacted by marijuana prohibition and enforcement.
Included in this list are Detroit, Ypsilanti, Highland Park, Pontiac, Flint, Ecorse, Hamtramck and Inkster.
The MRA’s team of social equity representatives will visit the impacted communities multiple times before the MRA begins taking applications on November 1, 2019.
They will provide one-on-one assistance with completing the licensure application, compile educational resources relevant to the marijuana industry, help identify and coordinate applicants’ use of resources, and answer questions.
Participating in the Social Equity Program will also allow qualifying applicants whose marijuana establishments will be located in disproportionately impacted communities to benefit from a reduction of up to 60% off the application fee, the initial license fee, and future renewal fees.
It’s definitely a good start.
“If we don’t do something about it now, there’s going to be no diversity in the industry,” Morris said. “So it’s important that this be addressed adequately.”
And there’s no time like the present.
Honoring Diversity in the Cannabis Industry
Minorities in Michigan cannabis businesses need to be equally represented. Especially given the repercussions their communities in particular faced as a result of the war on drugs.
This irony should be lost on no one.
We’re ready and positioned to help anyone who’s passionate about this industry. So if you need marketing or public relations for your cannabis business, contact us today.
And show the world what you truly have to offer.