Politics

Breaking Down Colorado's $4 Million Cannabis Entrepreneur Program

This Minority Cannabis Business Association's Opportunity Summit for prospective business owners took place at at Cultivated Synergy in 2018.
This Minority Cannabis Business Association's Opportunity Summit for prospective business owners took place at at Cultivated Synergy in 2018. Jacqueline Collins
After Governor Jared Polis signed Senate Bill 111 into law on March 21, the Colorado Office of Economic Development and International Trade (OEDIT) was tasked with distributing $4 million to implement a new social equity cannabis advancement program — so how will the money be spent?

The program is intended to spur participation in the state's marijuana industry from communities impacted by the War on Drugs. According to Representative Leslie Herod, a prime sponsor of the bill, distributing the money is up to OEDIT's discretion — although OEDIT can hire third-party contractors to distribute the money and create technical assistance programs, as well.

Senator Dominick Moreno, another prime sponsor, adds that lawmakers will be reviewing the process in years to come. "OEDIT has three years of spending authority, at which time the [Joint Budget Committee] and General Assembly will evaluate the program and contemplate further funding decisions," he says.

OEDIT is currently seeking a Marijuana Entrepreneurship Program Manager, who will be responsible for launching and facilitating the program's financial and technical aspects. Final decisions will be available to the public once they are approved, according to OEDIT Communications Manager Jill McGranahan.


Westword obtained an earlier draft of OEDIT's upcoming Cannabis Advancement Program, which outlines proposed allocations for loans, grants and technical assistance programs to support social equity licensees. Here is a breakdown of what we know:

Who Qualifies
The criteria for social equity license eligibility, found on the Marijuana Enforcement Division's website, prioritizes communities impacted by the drug war via several different qualifiers. To be eligible, applicants must prove one of following: They or their families were negatively impacted by the War on Drugs, they earn less than 50 percent of the state median income, or they come from a community designated as a low-economic opportunity zone by OEDIT. These zones also include communities that have been historically marginalized and negatively impacted by the War on Drugs.

Business Loans
The most recent proposal from the governor's office and OEDIT suggested that around $3 million should be set aside for low-interest loans ranging from $50,000 to $100,000. These low-interest loans are designed for licensees in the early stages of developing their first cannabis enterprise. The loans would serve an estimated ten to thirty new businesses over five years, according to OEDIT. Specifics such as loan amount and who qualifies for a loan versus a grant will be up to local discretion. Local governments and organizations that have their own social equity in cannabis programs, such as Denver and Aurora, could also benefit from these micro-loans.

Grants
A little under $1 million will likely support grants for social equity licensees as well as organizations that work with new cannabis entrepreneurs. The specific grant amount and number of businesses that could benefit from the grants are still up in the air.


Technical Assistance
Several hundred thousand dollars are planned to go into the Cannabis Advancement Technical Assistance Program, intended to provide access to business tools for social equity licensees. The program also has plans to host virtual marijuana-industry workshops to advise business owners, as well as one-on-one mentorship opportunities for aspiring cannabis entrepreneurs. This will be available to both new and existing business owners.

Is It Enough?
Other states with legal cannabis businesses have contributed more funding for their social equity programs. New York, which just legalized recreational weed,  is already working to embed diversity in the industry's early stages, starting with a $100 million plan for social equity in cannabis. California's cannabis equity program has $30 million, and so does a similar initiative in Illinois — and all of them legalized recreational cannabis years after Colorado.

"It's a start," says Senator Julie Gonzales, who also sponsored the bill that created Colorado's new program. "I think it's exciting that we were able to allocate these funds, and I think it's an important investment to try to bring equity, in a concrete way, to an industry that is really in need of diversity."
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Hilal is an alumni of Metropolitan State University of Denver with a degree in political science. Along with Westword, she's written for Denver Life Magazine and 303 Magazine.
Contact: Hilal Bahcetepe