How will Social Equity Play in New York’s Cannabis Licenses

With the biggest market on the East Coast, and with a city known as the melting pot of America, it’s no surprise that the New York bill legalizing adult-use marijuana, which passed on March 31, includes generous social equity provisions.

Now the key is if New York can avoid the pitfalls of other states in implementing the program. New York is the 15^th state to legalize cannabis with a commitment to social equity.

The bill calls for 50 percent of New York’s licenses to be slated for social equity applicants.

“For generations, too many New Yorkers have been unfairly penalized for the use and sale of adult-use cannabis, arbitrarily arrested and jailed with harsh mandatory minimum sentences. After years of tireless advocacy and extraordinarily hard work, that time is coming to an end in New York State,” Governor Andrew Cuomo said. “Legalizing adult-use cannabis isn’t just about creating a new market that will provide jobs and benefit the economy, it’s also about justice for long-marginalized communities and ensuring those who’ve been unfairly penalized in the past will now get a chance to benefit. I look forward to signing this legislation into law.”

The social and economic equity program is designed to help people disproportionally impacted by cannabis enforcement, as well as minority or woman owned businesses, distressed farmers or disabled veterans have access to the lucrative licenses. Additionally, preference will be given to applicants that are a member of a community disproportionately impacted by the prior enforcement of cannabis prohibition, have an income lower than 80 percent of the median income in the county, which they reside or was convicted of a marijuana offense, or had a close family member convicted.

According to the ACLU, 8.2 million people were arrested on marijuana related charges from 2001-2010. A whopping 88 percent of those arrests were for possession, not for selling or trafficking marijuana. Additionally, while both Caucasians and African-Americans use cannabis at similar rates in the United States, the latter are four times more likely to be arrested for possession.

Legalizing adult-use is expected to generate annual revenues of about $350 million, with $100 million of that going into a social equity fund. The level of New York’s projected social equity through marijuana law hasn’t been seen before. The remaining $250 million will no doubt help a state that was hit extremely hard by COVID-19.

Learn more about how to apply for a cannabis business license in New York and Schedule a Consult with an industry expert.