San Jose gets grant to look deeper at local cannabis industry equity

When San Jose opened its doors to the recreational cannabis industry in 2018, officials hoped those most hurt by its criminalization for decades would make up a big portion of the entrepreneurs that would benefit from its legalization.

But data shows that though people of color were most likely to be cited, fined and jailed for cannabis-related charges, they’re not most likely to own a cannabis business in California, according to Marijuana Business Daily.

Now, San Jose officials are set to look more deeply into how to level the playing field locally for people whose lives were disrupted because of cannabis crimes before it became a sanctioned business.

The city accepted a nearly $150,000 grant from the state last week for the study into cannabis equity. The results could help inform how to use $560,000 San Jose was awarded last year from the state to offer direct help to local applicants in the city’s equity program, which was initially developed using state guidelines instead of specific local data, said Michelle McGurk, assistant to the city manager.

San Jose officials have discussed expanding the city’s cannabis industry opportunities for months, but the timing of the grant to pay for a study is especially apt, said William Armaline, a sociology professor at San Jose State University who has been deeply involved in local equity issues, including those around cannabis.

The news comes as the city and country grapple with two major crises that intersect at their disproportionate impacts on people of color. Cannabis has long been at that intersection, too, he said.

“The question is about who actually paid the price for our decades of failed policy — because that’s what it is,” Armaline said. “Of course it was racist and of course it’s all these things … but we have to really understand what this is. It’s failed policy and very real people paid the price for that failure.”

Though cannabis is now legal in California, those same communities are now battling other major disparities. In recent months, the deadly coronavirus pandemic that ground many people’s lives to a halt for months has disproportionately affected people of color in nearly every way, Santa Clara County data show.

And just as shops and public amenities began opening up in the region, the death of George Floyd, a black Minneapolis man killed after a police officer kneeled on his neck for nearly nine minutes, sparked an international outcry about police brutality, particularly against black and brown residents. Protests have become regular occurrences across the country since Floyd’s death.

Both the pandemic and the protests bring up broader questions of equity that could also be addressed in the study on the local cannabis industry, Armaline said.

“There are all kinds of really important questions for us to ask right now in terms of equity — and perhaps even reach beyond the questions that would be asked around the cannabis grant — which are frankly just about criminal justice,” Armaline said. “You’re looking at who was most disenfranchised from the prosecution of the drug war … and there’s all kinds of really interesting things that could be done in this context.”

Other California cities, including San Francisco, Los Angeles and Oakland, have reached varying degrees of success in achieving equity with similar studies, according to Sean Kali-rai, founder and president of the Silicon Valley Cannabis Alliance.

As a lobbyist and real estate expert, Kali-rai has helped about half of the 16 legal cannabis businesses in San Jose get the permits needed to open. He’s seen first-hand some of the current pitfalls in San Jose and watched other cities’ response to cannabis equity closely.

Many of the studies “haven’t addressed the problem for the actual people it’s intended to,” he said. “You have a lot of straw men — large white companies, some from out of state, coming in and putting up a local black person … on title, but really siphoning all the profits out of it.”

San Jose officials also acknowledged that other cities have seen their own programs work against the communities they’re meant to help.

“Even California cities with long established cannabis equity programs have very few success stories,” Chris Burton, San Jose’s deputy director for the Office of Economic Development, wrote in a recent city memo. “In the worst cases, equity entrepreneurs have been exploited by disreputable landlords, financiers, or partners.”

Now the city’s task is to avoid similar pitfalls in its own local equity study and in the implementation of whatever recommendations follow.

But even though the money is officially in hand, officials are up against other limitations. Community outreach is particularly challenging during regional shelter-in-place orders and while large gatherings remain prohibited due to the contagious coronavirus pandemic.

San Jose hasn’t yet laid out a timeline for when its study will happen, McGurk said.

“Many of the team members have been reassigned to very important roles within the Emergency Operations Center citywide working on things like local assistance and homelessness and other issues tied to COVID-19,” she said. “The timeline is tricky but we hope to begin some work, though there’s no real prediction with it.”

When it does happen, the study will be a major, but important, undertaking, Armaline said.

“It’s not just, ‘well who was policed and went to jail for this stuff?’” He said. “It’s also what happened to the communities where all those people were policed and went to jail and their housing and their employment and their families and their kids and their schools. All these things connect.”

Contact Janice Bitters at [email protected] or follow @JaniceBitters on Twitter.