Social Equity Council finalizing low-interest loan, accelerator programs ahead of adult-use cannabis launch
Social Equity Council Executive Director Ginne-Rae Clay (right) speaks at an HBJ cannabis industry event.
As Connecticut’s cannabis social equity licensing process nears a close over the next few months, state officials are finalizing plans to launch a low-interest loan program for entrepreneurs and an accelerator program to help them get off the ground.
Social Equity Council Executive Director Ginne-Rae Clay and Chair Andrea Comer, also deputy commissioner of the state Department of Consumer Protection, took part in Hartford Business Journal’s Sept. 14 cannabis expo on a panel about where the state’s legal industry is at right now and where it’s headed.
Clay said the council is finalizing a contract with California-based Oaksterdam University and Hartford-based reSET to run an accelerator program for social equity applicants. The council allocated $1 million to create the program, which could launch in late November or early December.
The hope, Comer added, is that recreational marijuana sales will begin by the end of this year, led by medical marijuana dispensaries that convert to a hybrid license. Such a conversion allows them to serve recreational customers as well.
Further, Clay said the Social Equity Council is finalizing details on its low-interest business loan program for social equity cannabis companies. Lawmakers allocated up to $50 million for the effort. She said she hopes the council approves final terms and conditions for the loan program in November.
“As soon as it’s approved, those who have their provisional licenses can make an application,” Clay said.
Law flaws
The panel also heard some criticism about the social equity process so far.
Citing numbers from the state’s electronic licensing database, social equity applicant Gisele Tyler talked about the flood of license applications from some applicants and how that improved their chance of winning the lottery. Tyler said Slap Ash LLC, which recently won social equity status to pursue opening of a retail dispensary, submitted at least 1,000 applications totaling $250,000. The LLC is controlled by Florida resident Ashley Vaughn and Chicago resident Amanda Ostrowitz.
Tyler named several other retail lottery winners that each submitted hundreds of applications for their businesses.
“If you are a person who submitted 10 applications, because that’s what you could afford and thought would be necessary to have a fair shot — can true social equity folks that the legislation was designed to uplift expect some changes that would allow us to really have an opportunity to compete in what I call a legacy market?” Tyler asked.
Comer said she understands Tyler’s frustration, but the “legislation was silent,” on the idea that the same entity could potentially flood the state with applications. She said she was also surprised to see the staggering number of applications from some winners. There are other questions she had about the recreational marijuana law, like where the idea for a $3 million fee for social equity cultivators came from, despite strict income requirements on social equity status.
“You’re almost required to create a partnership with somebody that has the funds, but is also willing to cede a significant amount of control,” Comer said.
Comer also said she was surprised certain municipalities showed up on the disproportionately impacted area map for social equity cultivators, such as wealthy communities like Simsbury and New Canaan.
“As we talk about the bill there was intent around social equity, but I think there are certainly some aspects of it that thwarted true social equity,” Comer said. “I understand that we’re not going to undo decades of harm from the war on drugs with one piece of legislation, but we are committed to doing what we can to create an equitable market.”
She suggested that critics of the cannabis law contact their legislators to push them to make changes in the coming session.
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