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Litigation Blog.
The seasoned lawyers and litigators at The Rubinstein Law Firm are here to share their insights with you.

Social equity advocates call for marijuana industry diversity

The marijuana industry has hit the ground running here in Michigan, but some call for it to be more proactive in some communities. According to data collected by the Michigan Marijuana Regulatory Agency in December of 2020, only 3.8% of marijuana businesses ownership are Black, and only 1.5% identify as Hispanic or Latino. This information is based on those applying for licenses for recreational marijuana businesses in Michigan.

It was not the news many were hoping for after the Michigan Regulation and Taxation of Marijuana Act of 2018 had goals for promoting the involvement of minority communities, which were most adversely affected by the previous laws prohibiting marijuana consumption.

Group makes recommendations

The agency’s Racial Equity Advisory Workgroup made several recommendations on how to help bolster those numbers, although some would require action from the state Legislature:

  • Reinstate the 3% excise tax on medical marijuana sales and use the proceeds to foster social equity.
  • Raise recreational marijuana taxes, which currently have 6% sales tax and 10% excise tax, by adding a 1.5% on transactions between license holders (such as growers selling to retailers).
  • Use the money raised by these new taxes to provide loans and grants to minority applicants.
  • Create training and partnership programs for applicants who lack the operational experience to start a licensed business.
  • Increase land use access for qualified social equity applicants.
  • Take some current funding tied to counties and reallocate it to target social equity business owners.
  • Host a crowdfunding platform on the agency’s website that brings together local investors and local social equity business owners.
  • Provide training sessions to local municipalities on how to better foster social equity applicants.

Help is available

The laws involving marijuana business and social equity programs are quickly evolving, so potential business partners may need guidance in navigating them. Those with an understanding of marijuana law and establishing new companies can be a real asset for those interested in creating a marijuana industry business.