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March 8, 2023

6 social equity retailers backed by Chicago cannabis company get green light

HBJ Photo | Steve Laschever Grace Bondy from Verano looks at drying cannabis at CTPharma in Rocky Hill.
By Skyler Frazer

Two major players in Connecticut’s cannabis industry will be significantly impacted by votes cast yesterday by the Social Equity Council.

The council approved social equity status for six cannabis equity joint venture (EJV) businesses while revoking five prior approvals from 2022.

An equity joint venture is a business that is at least 50% owned and controlled by an individual or individuals that meet social equity criteria. Such entities can be created by existing medical marijuana producers and dispensaries.

All six of the EJVs approved on Tuesday -- CT Pharma Norwich LLC, CT Pharma Newington LLC, Caring Nature EJV 1 LLC and Caring Nature EJV 2 LLC, Willow Brook Stratford LLC and Willow Brook Enfield LLC-- are backed by Chicago-based Verano Holdings, which also operates Rocky Hill grow facility CT Pharma.

Verano Executive Vice President James Leventis said the approvals allow his company to move forward with its six planned EJV dispensaries in the state.

The Newington and Norwich retail locations are expected to open first in the coming months, the company said.

The Social Equity Council also voted to deny five other equity joint venture applications social equity status. They included: Atlantic Harvest LLC, EJ Ventures 3 LLC, EJ Ventures 4 LLC, Fresh Lyme Partners LLC and Raybrid LLC.

The council said it had already approved the maximum number of EJVs for the companies denied, which was limited to two per establishment in an amendment to the state’s legal cannabis law last year. 

Also during Tuesday’s meeting, the SEC voted to withdraw its previous approval of five EJV proposals from Fine Fettle. Last September the company was approved to open six EJV adult-use dispensaries with social equity applicants Diane Drakes, Carnetta Ellis and Kennard Ray, but since then the state has amended the legal cannabis law to prohibit social equity applicants from having ownership across multiple EJVs.

The company’s first EJV adult-use dispensary opened in Manchester in February, but the other five will be on hold for now.

Fine Fettle COO Ben Zachs called the decision “disappointing” for the company’s existing social equity partners but said they plan to resubmit their new ownership teams for the EJVs within the next several weeks.

“We respectfully disagree with the Social Equity Council’s decision that recent changes to the law required revocation of licenses approved six months ago,” Zachs said. “Those approvals reflected substantial expense and effort by a local team of Social Equity Partners and a locally owned operator deeply committed to one another and to the restorative goals of Connecticut’s adult use cannabis program. Reversal of those approvals is difficult and deeply disappointing for our Partners and our business. This directly impacts the social equity applicants that this law is meant to help and promote.”

The adult-use cannabis market, which opened on Jan. 10, reported about $12 million in revenue through the week of Feb. 28,  according to data from the state Department of Consumer Protection.

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