Sep 26, 2022 - News

Why Seattle's cannabis equity plans have limited reach

Illustration of a marijuana leaf decal on a ticket dispenser.

Illustration: Lindsey Bailey/Axios

Newly passed laws in Seattle aim to help people of color break into the state's mostly white legal cannabis industry.

  • But the legislation can only do so much without the creation of more pot business licenses at the state level.

Why it matters: City and state officials say communities of color — especially Black populations — have faced major barriers entering the state's legal weed industry.

  • That's unacceptable after those communities were disproportionately harmed by decades of the war on drugs, including the criminalization of marijuana, Seattle Mayor Bruce Harrell said last week.

The latest: Harrell signed three ordinances Sept. 19 aimed at improving equity in the cannabis industry.

  • One will slash licensing fees for cannabis businesses whose owners were significantly impacted by drug criminalization.
  • Pot business owners can qualify if they have lived in areas with a high rate of drug arrests, or if they or a family member were convicted of a past drug offense — and not necessarily just for cannabis.
  • Businesses would have to be at least 51% owned by people who meet those criteria.

Yes, but: City officials are constrained by the limited number of cannabis business licenses made available by the Legislature and the Liquor and Cannabis Board (LCB).

  • Right now, the number of retail shop licenses is capped at 556 statewide, while the window to apply for growing and processing licenses closed nearly a decade ago.
  • That means very few business owners will be able to take advantage of the city's new social equity policies, at least for now.

Flashback: Earlier this year, the Legislature rejected a plan to increase the number of retail pot shops allowed throughout the state.

  • With the current cap, Seattle officials estimate that only two cannabis retail licenses will be available for social equity applicants within the city.
  • Even those licenses won't be awarded until the state finalizes rules for its separate, statewide cannabis equity initiative — a process that is ongoing.

What they're saying: Jim Buchanan, president of the Washington State African American Cannabis Association, called the city legislation "smoke and mirrors" that doesn’t do much to address racial equity issues in the industry.

  • For greater impact, Seattle officials should dedicate all of the city's cannabis tax revenue toward community reinvestment programs, he told Axios.

The other side: Council member Teresa Mosqueda told Axios that the city's new laws are just a starting point.

  • One measure will commission a "cannabis needs assessment" to identify ways of improving the industry in the future, she noted.
  • Another adds job protections for cannabis industry workers. That should help employees — many of whom are people of color — in the nearer term, Mosqueda said.
  • The city also plans to lobby the Legislature next year to increase the number of cannabis business licenses, to create more opportunities for people, she added.

Of note: Only 1% of pot producing and processing businesses in Washington state are majority-owned by Black people, while about 4% of marijuana retail shops are majority Black-owned, according to data from the Liquor and Cannabis Board.


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