With the anticipation of federal marijuana legalization, the cannabis industry rang in 2021 with sky-high equity values and anticipated social justice reforms seemingly imminent. However, differing ideas regarding how to legalize marijuana has left federal legalization in limbo and, 20 months later, the sector is still plagued by a myriad of factors that have effectively limited opportunities to succeed in the newly legal cannabis market: onerous capital requirements which can only be financed privately, prohibitions on granting licenses to drug felons, and other hurdles. While both chambers of Congress have made strides by passing bills addressing these issues, such as the Secure and Fair Enforcement (SAFE) Banking Act, Cannabis Administration and Opportunity Act (CAOA), and the Marijuana Opportunity, Reinvestment and Expungement (MORE) Act, all have failed to secure enough bipartisan support to break through the stalemate.
Indeed, data shows that certain communities have been disproportionately affected by the enforcement of cannabis laws, and an overwhelming majority of people involved with the cannabis industry agree that social justice reform is a key component to both address these inequities and level the playing field saturated by wealthy individuals and corporations. Yet, without reforms at the federal level, state lawmakers are left to implement their own, varying laws to address – or not to address – those issues.
A Tale of Two States
For example, in Texas, a state which continues to resist the decriminalization and regulation of marijuana, possessing two ounces or less of marijuana is punishable by up to 180 days in jail and a $2,000 fine. Because possession of any amount over four ounces is a felony, a person possessing that amount up to five pounds can be punished in Texas with up to a one-year prison sentence and a $4,000 fine (with increasing levels of prison time and fines dependent on the amount possessed at the time of the arrest). Because these laws criminalizing marijuana remain intact in Texas, no social justice discussions can be held in that state, since no discussion regarding regulating marijuana is being held in the first place.
Conversely, New York’s Marijuana Regulation and Taxation Act, just recently passed, removed marijuana from the state’s Controlled Substance Act and put racial and social justice front and center of the state’s regulatory scheme by prioritizing:
i) automatic expungement of possession-related marijuana convictions;
ii) equal (and even prioritized) access to marijuana business licenses for people disproportionately affected by cannabis criminalization; and
iii) investment in communities disproportionately impacted by the enforcement of laws criminalizing cannabis.
Florida: Stuck In Between
Somewhere in between these two states, when considering Texas and New York as opposite ends of the United States’ marijuana regulatory-reform spectrum, falls Florida, where medical marijuana has been legal since 2016. Florida has tried, but mostly failed, to deliver on its promise of opportunity for minority communities to participate in the state’s new regulated marijuana industry. At the inception of Florida’s medical marijuana program, the legislature promised to set aside at least one medical marijuana license for a Black farmer to participate in the state’s marijuana industry. However, almost six years into the program, not a single medical marijuana license has been issued to a Black farmer (despite the fact that in that time, the Florida Department of State has issued more than 20 medical marijuana licenses). Of these more than 20 licensees, no more than 15 actively operate any dispensaries at all, and just three multistate operators (Trulieve, Surterra and Curaleaf) control more than two-thirds of the market. The delayed distribution of medical marijuana licenses for Black farmers, coupled with the high application fees (initial fee of more than $60,000) and expansive costs associated with operating a license (attorney fees, hiring technical writers and consultants, sourcing real estate for cultivation and processing), not to mention the state’s requirement that licensees also be vertically integrated, have also created additional, though likely inadvertent, barriers to entry for those most affected by the state’s former laws criminalizing marijuana.
Recently, the federal government has started to take notice of, and issue with, these widespread differences between states’ priorities and goals with respect to their respective cannabis industries, and has drafted a powerful federal law which “focus[es] on the restorative justice aspects” of modern marijuana regulation: the CAOA. One of the bill’s sponsors, Sen. Cory Booker, has long argued that meaningful change must occur at the federal level to truly address these historic disparities, level the playing field, and ensure an equitable marijuana industry in the United States. It remains to be seen, however, if the United States will adopt such sweeping reform, or if a more incremental approach, such as passing the SAFE Act, will ultimately be the path that leads to federal legalization.