The passing of HB- 20 1424  aka Colorado’s first Cannabis Social Equity Bill accentuates the fact that opportunities are arising for POC and marginalized communities in the Colorado cannabis industry. This Social Equity Bill seeks to make ownership in the cannabis industry more accessible to those negatively affected by outdated cannabis laws. January 1, 2021, is the day applicants can apply to become a Social Equity Licensee. Here is what you need to know.
The Social Equity License includes both medical or retail operations. Applicants can apply as cultivators, manufacturers, or dispensaries. What we know according to the bill itself is that there will be some kind of reduction in fees given to participants. How much of a reduction is yet to be seen.
“January 1, 2021 is the day residents can apply to become Social Equity Licensees”
Licensees will also be required to partner with another Colorado cannabis company that can guide the Social Equity Licensee through regulatory compliance. When applying, applicants must meet certain requirements to prove they were negatively impacted by cannabis laws. To be a successful applicant you must be a Colorado resident, own at least 51% of the beneficial ownership of the Company under license, plus, have not received disciplinary action from the Marijuana Enforcement Division. In addition to this the applicant must demonstrate at least one of the following: reside for at least 15 years between 1980 – 2010 in a disproportionately impacted / opportunity zone, the applicants’ guardianship was arrested, convicted, or subject to civil asset forfeiture related to Cannabis offense, the applicants household income in the year before application did not exceed an amount yet to be determined amount.
As one of the first states to legalize recreational cannabis in 2014 with Amendment 64, Colorado has over 6 years in the legal recreational game, not including medical cannabis businesses. [2, 3] It is not hard to imagine that the market has grown and shifted. A fun fact that you may hear upon a visit to Denver is that the city has more dispensaries than Starbucks. We have so many dispensaries that in 2016 there was a freeze on retail licensing. This means if you want a retail dispensary, you had to buy a retail license from a company that is exiting the market. This also means that when these licenses become available they are very expensive compared to others. This is one reason so many people are looking forward to seeing what the fees and additional requirements are for the Social Equity Program. They will set the tone for people entering this market.
Since its passing, the specifics of the bill (i.e fees) are being specified by a special committee. Cities like Oakland, CA have seen positive growth in their programs, having supported many young entrepreneurs as they grow their Canna-business. [5, 6] Denver hopes to have as much luck. As the first city to legalize finally prepares to implement a Social Equity Program, there are many things to consider, namely: the current local Canna-business market and the HB – 20 1424 itself. To prepare yourself for the January 1, 2021 release, ensure that all your business is organized, familiarize yourself with HB – 20 1424. Keep an eye open for final updates on the bill. Follow @_WiseWest and @Wiseway_cbd on Instagram for developments on Colorado cannabis. Schedule a free Canna-business consultation at WiseWayCBD.com.