Dozens of cannabis retailers reveal social equity plans

FRIDAY, Feb. 5 — Dozens of recreational pot shops in Michigan have published once-private business plans to bolster racial equity within the cannabis industry. But most entrepreneurs — including the majority of those operating in Lansing — are keeping their ideas under wraps.

The state Marijuana Regulatory Agency posted social equity plans of Michigan’s recreational cannabis companies this month, revealing licensure application details that have until this week been kept hidden from public view and otherwise shielded from the Freedom of Information Act.

So far, a total of 37 companies have agreed to release their written plans geared toward diversifying their staff, chipping away at socioeconomic barriers and expanding industry equity. But the other 259 licensed businesses haven’t granted permission to release those plans, including every dispensary in Greater Lansing. The release only includes details from three businesses tied to Lansing: Rehbel Industries, Redemption and Emerald Secure Transportation.

“The public posting of licensees’ social equity plans is another step in the direction of providing opportunities for those who suffered the disproportionate impact of the war on drugs,” according to a statement from Desmond Mitchell, operations director for the Marijuana Regulatory Agency.

State data collected in December showed massive racial inequities among those who have an ownership interest in a licensed adult-use pot shop in Michigan. By last count, only 3.8% of retailers statewide are owned by Black people. And only 1.5% of owners identify as Hispanic.

As part of licensure, entrepreneurs are required to submit a plan to promote and encourage participation in the industry by people from communities that have been disproportionately impacted by marijuana prohibition and enforcement to positively impact those communities.

Prior to this month, entrepreneurs have kept those plans private. The public release serves as a sort of accountability measure that allows customers to read each plan and weigh their merits.

Some are comprehensive and include goals of hiring more diverse team members — including those with prior marijuana-related convictions. Others are lofty goals with much less specificity.

And most companies are either unaware of the new listing or would rather keep plans private.

“As a former journalist, I can appreciate the transparency,” said Anqunette Sarfoh, a Michigan Cannabis Industry Association board member who serves on the state’s Racial Equity Advisory Workgroup. “But from a business aspect, I have to wonder about some of the privacy concerns.”

Sarfoh said some cannabis retailers might not be too eager to release their social equity plans out of fear of sharing “corporate secrets” with the competition. Other businesses that require state licenses also don’t have to report whether or not they’ve publicly released diversity plans.

Sarfoh asked: Why should pot shops be held to a different standard?

“It’s tough because this is an emerging industry and all of these rules have already been written,” Sarfoh added. “This is also a competitive business. Why give the competition ideas?”

Rick Thompson, publisher of the Michigan Cannabis Industries Report, said it’s not uncommon for companies to want to keep their “internal business mechanics” out of the public eye. But in this case, cannabis retailers with ideas to bolster racial equity shouldn’t be afraid to share them.

“This could also be indication their social equity program is weak and they’re hiding it,” he said.

Tom James, the owner of Homegrown Cannabis Co., said he wasn’t sure why his business plans weren’t included in the public release. But the company hasn’t been quiet about its values. James announced a full-ride scholarship for a Black high school student in Lansing last month in response to Black Lives Matter. The business is also partially owned by a Black man, he said.

“It’s also important to recruit a diverse staff and put people of color in leadership,” James added.

The business model for Redemption Cannabis is also about much more than just selling dank weed. Founder Ryan Basore, who with six others were known as the Okemos 7, was sentenced to federal prison in 2009 for charges related to serving as a marijuana caregiver. His brand is also focused on righting the wrongs of cannabis prohibition, with 10% of revenues going to those harmed by the war on cannabis with legal and financial support, state records showed.

Lansing-based Emerald Secure Transportation emphasized that it does not discriminate based on age, sex, religion or based on prior marijuana-related convictions. Its equity plans also detailed a goal to “educate those who have been impacted negatively within the community.”

Rehbel Industries, which operates a massive growing and processing operation out of the iconic John Bean building on Cedar Street, also detailed a mission to bolster access to the industry.

Those plans include offering employment to those with prior marijauna convictions, promoting a “nondiscriminatory workplace” and a longer-term goal of improving nearby property values.

“Rehbel is invested in the ongoing growth and success of the Michigan marijuana industry and we feel that incorporating new policies and practices will contribute to the resolution of social disparities in our industry in both a positive and productive manner,” according to the plans.

Racial diversity is a major factor in leveling the playing field of the cannabis industry. But equity also comes in other forms. Real Leaf Solutions in Kalkaska — which donates 5% of its harvest to Redemption — also has plans to bolster hiring opportunities for women and older employees.

Licensees that didn’t provide their consent to reveal social equity plans can still grant permission to have them published at any time. Email mra-socialequity@michigan.gov for more details.

 

Source: Lansing City Pulse