Just Economy Conference – May 7, 2021
With the legalization of cannabis in more and more states nationwide, banks and other financial institutions are gearing up for potential massive involvement with the cannabis industry through the SAFE Banking Act. This, however, does not reverse the negative racial disparities of cannabis arrests and convictions, which historically occurred in areas where people of color lived. In order to improve social equity, we need to create a just economy by repairing this damage through equitable licensing practices, ensuring the industry reflects the local community, addressing financial barriers to market entry, and reinvesting tax revenue into communities directly harmed by this injustice.
Speakers:
- Erin Kirk, Cannabis Gov’t Strategies
- Reps Hughes and Porter, CGA
- Julie Goggin, Lawyer, Entrepreneur, Civil Rights Activist of Silicon Valley Executive
- Jeanne Sullivan, Arcview Ventures
- Jason Ortiz, Executive Director of SSDP
- Candice Nonas, RGP
- Dasheeda Dawson, City of Portland Oregon
- Steve DeAngelo, American Cannabis Rights Activist
- Patrick Gorman, Cannabis Gov’t Strategies
Transcript
NCRC video transcripts are produced by a third-party transcription service and may contain errors. They are lightly edited for style and clarity.
Kirk, 00:44
Good afternoon and welcome to NCRC’s breakout panel, Cannabis and a Just Economy. Today, we have with us and distinguished guests. We’ve got Representatives Anne Hughes and Robin Porter from Connecticut who are rewriting the cannabis legislation right now to include more equity. We’ve got Julie Goggin, who’s jumping into the cannabis space. She’s a lawyer, entrepreneur, civil rights activist in Silicon Valley. Executive Jeanne Sullivan runs ArcView Ventures and has been described as one of the most important women in VC by Forbes magazine. Jason Ortiz is the minority cannabis Business Association, former head and now executive director of students for Sensible Drug Policy. He’s got outfits in 30 County, 30 states and 30 countries and 100 in the United States. We’ve got Candace Nonas, who’s a finance wizard I’ve known for 20 years, I’ve been begging her to get into the cannabis space and get the heck out of banking. And she’s finally bought some wonderful land in upstate New York. And she’s jumping right in. We’ve got to see to Dawson who’s currently doing amazing things reinvest in cannabis income and taxes, and putting that money back into minority communities to bolster them. And she’s doing great work done everything, including written the book on how to succeed in cannabis. Steve DeAngelo. Everybody knows Steve. He’s the father of modern cannabis, the leader of the last prisoner project. And I think my soulmate. My partner, Patrick Gorman, and I have cannabis government strategies work with all our partners here to seek equity, justice, and a better economy. Here we go Jeanne, over to you.
Sullivan, 02:21
Hey, thank you, Aaron. I am so delighted to be here, and hopefully connect some dots of some of the fabulous conversation that happened all week long. So thank you so much for this invitation and the chance to meet know these great people. So I am part of a group standing up a number of investment platforms and a longtime venture capital investor. And see my best credential to tell you today is I actually believed the war on drugs as I was growing up. And even beyond growing up, I thought that was something to pay attention to. But seven years ago, I went on my cannabis journey. And I learned that the war on drugs is a war on science. It’s a war on research. And it’s a war on people, especially people of color. I went what I couldn’t believe to learn about the stigma, but there is no one better to give us the reasons why it’s critical to understand the history, the effect of change-making around all this, then Steve DeAngelo, as you heard Aaron say, properly referred to as the father of modern day, legal cannabis industry. So Steve, I’ve heard you speak so many times, about the incredible history, the Rockefeller laws, the drug laws, the stigma, give us your perspective, the cannabis industry is different than other industries, industries, as I’ve heard you say so many times, with a long history of more than 100 years of injustices that now we’re working hard to change. Tell us your perspective on it. We want to hear from you.
DeAngelo, 04:07
Well, thanks so much for having me, Jeanne, and thanks for the kind depreciation of my work. the cannabis industry is different. It’s different in two main aspects. One is the history, how we got to this industry, and the other is the manner of its creation. And in my view, the history connected with this industry places upon us an obligation and the manner of its creation gives to us a really wonderful, wonderful possibility to do what this conference is about, and that’s to build a more just economy. The cannabis laws in the United States are, we’re in response to the entry of cannabis. by two vectors around the turn of the last century, cannabis came into the United States through the hands of brown people and black people. One vector was the southwestern border. Mexican refugees fleeing the Mexican Revolution 1910 1911 1912 came across the border, and they brought their medicine with them. Cannabis had long been established in the Korean Darrow curandera folk medicine network in in Mexico. The other vector for the entry of cannabis to the United States was Afro Caribbean sailors coming into ports like New York and New Orleans, where they quickly linked up with jazz musicians. And cannabis became critical to the development of jazz, and then moved through the mainstream American society, largely along the same pathways of jazz. It’s very interesting because in those days, jazz clubs were one of the few places that people of different races could actually get together. And so it was in the jazz scene that cannabis made its jump from the hands of people of color into the hands of white mainstream American culture. The the original laws were passed in 1911 1912 1913. If you go back and read the legislative record, which I’ve done, you’ll find that there’s no consideration of the scientific aspects of cannabis, its social impact, its history, anything. The entire legislative debate was about these black people and these brown people who are out of control who are causing trouble, who, who need to be to be brought under control. And the laws were created for that purpose. And of course, if we, you know, look at the statistics on on how those laws have evolved over the course of the last 100 plus years. What we see is that the disparity in cannabis enforcement is not some unintended consequence of the war on drugs that just happened. It was the major animating purpose of cannabis prohibition in the very first place. And so, we have this vast history of disproportionate impact of cannabis laws on communities of color, and it’s just been a absolutely devastating impact. The other thing that really makes this industry different is the manner of its creation. Most industries are developed in backrooms. They’re developed in laboratories. They’re developed with scientific breakthroughs or an entrepreneurial idea that gets percolated that gets discussed that gets developed in private. And by the time a new good or a new service or a new company enters the marketplace. Most consumers most people don’t really have an opportunity to engage in the molding and the making of that industry. But cannabis is different. Our industry, the legal cannabis industry, starts with the stroke of a pen with the passage of a bill. Everybody lines up with the starting point, and we’re off to the races. So this gives the public a magnificent and very rare opportunity to participate in the development of an industry. an industry that I believe in, in the course of the next few decades is going to become the most valuable and important industry on planet Earth. What just happened in New York gives a really great example of the power of the public to start molding a more just cannabis economy. In New York, which just legalized cannabis, the posture of the governor had been to be very hostile to cannabis for a number of years. There was this fortuitous sex harassment scandal that happened just a few weeks ago. And the governor in desperation to get that scandal off of the front pages of the newspaper, went to the cannabis community, and basically gave us everything that we’ve been asking for in order to get that law passed to get it through the legislature and get a new story on the front pages. So very, very interesting. 50 The governor had been talking about auctioning off cannabis licenses to the highest bidder, which would have created a very unjust cannabis economy in New York. But the community pushing back with the help of this scandal, was able to pass what I think is probably the most progressive cannabis regulation bill that we’ve seen anywhere in the country with 50% of licenses allocated for social equity licensees with consumption clubs being allowed, with the consumption of cannabis on any place, any place in New York, that it’s legal to consume a cigarette. It’s now illegal to consume cannabis, but most importantly for the purposes of art. conversation, they have created a license category a cottage license category, which allows growers to grow a 3000 foot canopy, and then directly retail, the cannabis that they grow to consumers. This does two things. One, it opens up the possibility of a very low capital entry point for small and medium-sized cannabis businesses. And it also creates a vertical opportunity with a nice fat margin. So my hope is that the state is not going to limit the number of these cottage licenses that we see 1000s and 1000s of them in New York. And that we really set a new pattern for the industry. I’ll leave you with one other thought I know I’m over time Jean, but I just got to share this tidbit with you. In New York, there is now talk for the first time of a programmatic effort to bring legacy cannabis operators into the system. And the central feature of that program would be an amnesty, wherein the underground legacy operators would declare themselves there would be a settlement that would be paid, and they will be amnestied from criminal prosecution and from tax prosecutions moving forward. It’s something that I’m very excited about and and will hopefully have a chance to update this group on moving into the future. Thanks so much. Sorry, I’m over time.
Sullivan, 11:25
No, thank you, Steve, your words of wisdom, your history in the industry more than 40 years is so important to hear. I want just as you want wellness, for so many and wealth. That’s what we want for all why not. But I cannot let this moment go without hearing your passion project, the last prisoner project, give us that insight because I think it’s remarkable, and I still respect what you’re doing. Talk to us about that.
DeAngelo, 11:58
The idea behind the last prisoner project is very simple, that as we build this new legal industry, as people are gaining intergenerational wealth from it, we have a moral obligation to make sure that everybody, everybody who is in prison on cannabis charges today, who are there for doing exactly the same things that legal operators are doing, are released, and are given the resources that they need to rebuild the lives that were stolen from them. Our central supporter has been the legal cannabis industry. Over the course of 18 months, we’ve been able to assemble a staff of full six full-time employees, and in the last six months have been responsible or partly responsible for the release of about three dozen prisoners, including the longest-serving prisoner, nonviolent prisoner in United States, Richard Delisi. And the longest-serving nonviolent prisoner in Michigan, Richard Michael Thompson. So that’s less prisoner project, you can find more of our work at last prisoner project.org.
Sullivan, 13:05
Thank you so much for that. Patrick, yes,
Gorman, 13:09
I just want to ask the audience to please if they have questions or topics you’d like to see covered, if they could throw those into the comment section. We’ll be gathering those along the way and relaying them to Jeanne, thank you so much.
Sullivan, 13:19
Thank you so much. Aren’t we lucky that we have to have fabulous women who are part of the Connecticut State Legislature, you’re making and driving these laws? So welcome. Representative Hughes and Porter, speak to us because I’ve learned from you the importance of understanding the differences between federal legislation, state and local legislation. Talk to us. Give us your insights about that and the work you’re doing in Connecticut. Thank you so much.
Hughes, 13:49
Thank you so much for having both of us at two for one year in Connecticut. Yeah, Connecticut General Assembly has an incredible opportunity Connecticut’s us to lead on the end of prohibition of cannabis to lead on this and learn from all the other states that have ended the prohibition and legalized adult-use marijuana. But policy matters. 70% of our public want legalization, but they’re not that clear about the details. That’s where legislators come in to lead the way and really I feel like our job is to create space for those most harmed by this war on drugs and like Steve said the war on black and brown people and communities of color to be at first at the table with crafting what equity looks like what equity release expungement and homegrown looks like either decriminalize it or you don’t you don’t grow for some people and not for others and have, you know, and the prohibition on a plant, right. So that’s why I’m so pleased to have a representative Robin Porter, who is really well Leaving the fight because it is a fight. And she’ll tell you more about the actual fight of really having the people most impacted and this opportunity to repair the harm that we have deliberately wrought through policy. Thank you. And thank you for coming. The challenge, I just want to talk about the challenge, right, let’s just put it right out front, to start with the challenges that equity is being driven and dictated by corporate America, which is controlled by white male capitalists, and they have entrusted don’t serve us. And when I say us, I’m talking about the folks that represented us just mentioned, the black and brown people, the poor white people, right, this was a war on people. You don’t go to war against things, you don’t get to go to war against people. And, you know, Nixon said, there were two enemies, blacks and those hippies. And this is what he did in order to, you know, rein in the power that we were starting to accumulate. And as we write this, I have to tell you, I got to he talked about the power of the public, Steve, you know, that power is, you know, folks like Jason Ortiz and Rashida Dawson, the wisdom, you know, that we’ve been able to partner and gain from them just extrapolating what they know, because they’ve done so much work, you know, throughout the union on this, but social equity is a big component, you know, we got to talk about expungement, you can’t have, you know, white males getting rich off, it is why you have black and brown males and females sitting in prison serving life terms for nonviolent offenses, homegrown, you have to decrypt it, and it has to be home, bro for everyone. Right? Nobody gets to tell you that you can’t buy liquor or how much liquor you can have. Or if there’s gonna be, you know, we’re scaling back. And we’re gonna make it legal. There has to be legal straight across the board. And there’s so many different intersections to this, you know, as the labor chair, what’s important to me is that there’s a labor peace agreement, right, that these are good paints sustainable, livable wages, that you know, there’s no retaliation. If you want to form a union, you have great benefits, you have a paid pension or retirement plan, the things that helped to build generational wealth, where we have been disproportionately left out and left behind. It’s about economic power, you know, and people say, Well, what is equity? equity is economic justice. Because if we take care of us financially, you level the playing field for black and brown folks and poor white people in this country. We don’t have to talk as much about criminal justice reform, and education reform, all these reforms we’re trying to address because we know that this is where the gap lies. It’s not an achievement gap. There’s a chokehold on our communities. And one of the biggest choke holes has been, you know, the criminalization of this, plant this medicine. And back in the day, that’s what it was when they say we’re going to legalize marijuana, right. And to me, that’s like saying the N word, seriously, it’s cannabis. You talk about doing that you disproportionately impact us and put us in a very in a bad position. And what concerns me right now, is that the cannabis businesses rigged, it’s rigged. And the challenge that we’re facing in Connecticut, is making sure that it’s not rigged here. And that we put forth a piece of legislation that will truly be so progressive, that any state coming behind is trying to get this done. We’ve got the plan. Yeah. So I mean, we want to make sure there’s not things like slave master clauses and sharecropping clauses. And, you know, it looks, it’s what you’re saying, but it’s not what you’re doing. Right? When we talk equity, we want to make sure that there’s equity and the only way you get to find equity as having set the table. Well, but you’ve never needed.
Sullivan, 19:00
Listen, how lucky we are to have you, as a legislator, writing these bills promoting this, how likely are you to get what you might need in this year session?
Porter, 19:11
Very likely, very likely. But what I will say is this, we’re going to do it, and we’re going to do it right. Or we’re not going to do it at all. That’s right. And I and this is a you know, we’ve always been asked to compromise. And I’m offended by that, because we started out in this US Constitution and three-fifths compromise. And here we are in 2021, still being asked to make compromises. You don’t compromise on doing what’s right.
Sullivan, 19:38
I hear you. It’s great.
Hughes, 19:41
With the Connecticut legislature, or governor, it’s a question of how much racism do we get to keep in the policy? And what policy gets passed is going to answer that. So I’m going to keep asking that question.
Sullivan, 19:56
And are you in session just to the mid-year June 30. Or what is your June 9?
Hughes, 20:01
Just til June 9, so the rubber is hitting the road these fights are happening fast and furious right now
Sullivan, 20:05
Good go make it happen. I thank you so much for being with us. Candice, talk to us. I too, like you love during the campaign for women. Talk to us about your work what you’re doing on bro expungement for women to scope them. Tell us what you’re working on.
Nonas, 20:23
Yeah, thank you, Jeanne. I just I am so honored to be on this panel. And I hope I don’t repeat anything that the panelists have already said, because those issues are critically important. I am a 20 year veteran in the banking industry. I have worked with the FDIC, I know banks from the inside out and the outside in and I’m in New York State in New York State, cannabis farmer, a member of the Hudson County cannabis industry association where I sit on both the social equity and the banking committee so very much invested in what’s happening at the ground level here in New York State. So Jean asked me to keep it bullet points and keep it pithy. So that’s exactly what I’m gonna do. You know, when we talk about economic justice and social equity, I always look at it from the lens of a economic and financial perspective. And I think as everyone has said, so far, we must hold government accountable for economic justice and social equity and cannabis legalization. It’s easy to write an intention that communities that were disproportionately impacted by illegal cannabis be disproportionately advantaged by the legalization of adult-use cannabis. That sounds great. But we’ve already seen many examples and other states where it absolutely did not work out that way. So I just want to share some thought-provoking bullet points again, some of them have already been mentioned by esteemed experts. But you know, social equity, participants, black and brown people must be first in line to receive cannabis licenses, like Steve said, that is so critical here in my state in the state of New York. But I also want to see eliminating barriers to entry as it relates to financing, zero-interest loans, grants, coming up with a scheme that encourages people to kind of come out of the shadows, if you will, from the illegal cannabis to the legal cannabis. And again, Steve talked about the forgiveness, opportunity and paying the fine. But I also go a little further to think about a taxing scheme, something maybe that can be scaled based on economic position in your capabilities economically, right. So we have to also ensure and Representative Porter said this so beautifully, that we don’t set up an infrastructure that de facto relegates black and brown people to the cheapest, lowest profitability, parts of the cannabis industry we have to have, we are capable, and we have to be able to go toe to toe meaning not have barriers to entry with big cannabis and corporate cannabis. Right. So there’s also I don’t want to go on too long, but criminal justice reform and community reinvestment is critical and the taxes that are going to be generated and the money that is going to be generated by both home grow, as well as corporate cannabis or commercial cannabis. There has to be very strict guidelines of what those requirements are, with regard to economic investment. And there has to be regulation and honest consequences for not meeting those standards. If you’re going to get big, juicy tax breaks, then you have to your feet have to be held to the fire. And speaking of tax breaks as a farmer, I want to be incentivized from a tax perspective to hire prisoners who are reentering the community to hire veterans and disabled people. This is who we should be helping. This is who we should be targeting. We should be thinking about community reinvestment with regard to job training, financial literacy, training record expungement and not having your past cannabis history be held against you, if you are on probation, etc. I know I get passionate about this because as representative Porter again, so eloquently eloquently pointed out, these were laws that were specifically designed to inspire and entrap and throw people that look just like me in jail, just like my brothers in jail and it wasn’t necessary. We all know that black and white people consume marijuana smoke cannabis at the same rates. But in some states, black and brown people of color are six, eight and even 10 times more likely to be arrested for the same crime. And in closing, I just want to say, you know, please make no mistake, this is not a handout. As an African American woman, this is not a handout. legalized cannabis rep revenue, I believe is A small restitution for racist laws designed to tear me away from my family and destroy my community. So I want to leave my comments right there and just add one more piece of food for thought. I know I said this last one. But this cannot go without saying because it’s a kind of a fun fact that I recently learned. Did you know that the Department of Agriculture has the second-largest federal budget only second to the Department of Defense. And they have a storied history of discriminating against black and brown farmers for generations? How can we use that factoid and use that opportunity that they’re now starting to make reparations and restore confidence in black and brown farmers to transfer over to black about brown farmers in the cannabis industry? Jeanne, I again, thank you for allowing me to speak and participate in this panel. If you have any questions or comments, I’ll be happy to take them.
Sullivan, 25:58
No, thank you so much for your passion and for your work. It’s important. See, what I think is exciting about being here today is to show people who may not know these facts, what is really going on and what needs to happen. That’s the thrill of having an audience today like we do. And Aaron, feel free to ask any questions. Or maybe we’re, we’re just rolling right along here. Now, Jason, Jason Ortiz, SSDP, I have known the wonderful organization since it started with fabulous Betty. And I was shocked to learn the vastness of SSDP. tell our listeners, our audience, what SSDP is, the amazing number of companies and what you do for students talk to us about that.
Ortiz, 26:48
So SSDP is the world’s largest student-led organization that focuses on empowering youth who use drugs to change the laws in their communities to be more sensible, more adjust and more applicable to reinvestment in all of our communities. And I actually found out about SSDP, as a chapter member when I was at the University of Connecticut. And in my work there, as somebody who had been arrested in high school for cannabis, I was affected by a law called the Higher Education Act, federal aid elimination penalty. And so this is a collateral consequence of the war on drugs that denied everyone financial aid, if you got caught with a cannabis possession, I was one of those people. And so I almost wasn’t able to go to college because of that. But because of the work of SSDP and other organizations that change that law, I was able to go to college, I was able to find SSDP. And I was eventually able to become the executive director of the world’s largest youth-powered criminal justice organization. And I think it imbued in me the importance of the details in policy and really thinking through exactly how we’re going to write every law that we move forward. And luckily, I was able to join another organization before my time at SSDP, called the minority cannabis Business Association, where I was the president for the last year and a half or so luckily, finished, my Chairman passed the baton over to my friend colleague, co Castiel. But minority cannabis.org is the website for MC VA. And in that organization, we drafted model policy based on stakeholder-driven public policy. And so we had folks that were from impacted communities, experts in other fields that weren’t necessarily drug policy, but directly related such as housing rights, parental rights, Educational Rights, all of those other aspects of society, that the war on drugs has infiltrated in her. And so when we think about community reinvestment, we have to think about the totality of the damage done by the war on drugs, and how are we going to reinvest in all the different aspects, if we destroyed parents and took kids away from their parents and put families in prison, then we need to reinvest in family services and family planning. If we took education away from you know, young people that wanted to become academics, we need to reinvest in education. If we economically impacted communities writ large, then we need to economically reinvest in those communities in a large way. So I was someone that saw all of the impacts of these policies. And so when I was lucky enough to work with folks like representative Porter and Representative Hughes, we wanted to make sure that our policies in Connecticut were comprehensive and addressed all these different pieces. And in doing that, we brought more communities into the fight to end the war on drugs. We have tribal members from our Native American communities that are helping us push this forward. Students have been, of course, as I think most folks know, here at the forefront of all social change in the world. And so making sure that our young people are involved has been at the top of our agenda, right. And so SSDP has actually been around for 20 years. And so a lot of our folks that went through SSDP are now state representatives and lawyers and elected officials and are changing the policies throughout the world. And I want to say the world because it’s the world that is watching what is happening in the United States right now. And it is the United States that exported our policy to the world. So as we change things in New York and Connecticut and Colorado that is impacting Columbia and Ireland and Africa and all those places. SSDP has chapters, we recently just had our international conference where over 200 students from around the world told us exactly what they were doing and working on lots of different issues. And they said the fight in the United States on drug policy is rippling out not only to be passed in New York with the most equitable law we’ve ever seen, Oregon also passed a ballot measure to decriminalize all drugs. And so the end days of the war on drugs is upon us. But it’s the folks that you’re looking at today that are going to finally end it. But we do need support, we need support from all members of society, folks and civil society, folks in the business environment to come out and say that the time for waging a war on our own communities is well past done, we need to have a serious accounting of the damage, and start to create the reconstruction process that this country never really finished, you know, from the 19th century. So I think we have a lot of work to do. But we have a lot of powerful people that could help us do it. And I think as we push on the federal level, I’ll just leave you with this. I believe one of the biggest things we can all ask for all of our congressional folks right now, which is short of legalization is to initiate a Truth and Reconciliation Commission on what happened with the war on drugs, how the policy was created, actually quantify the damage done and begin to talk about community investment in ways we’ve never heard before. If we can come up with a $4 trillion stimulus plan for infrastructure, I think we can figure out the math on how to make it happen. And so I think, as we move forward, we have lots of piecemeal pieces that we want to make sure we move things and show that things can happen, and we can make progress. But we can’t lose sight of if we don’t actually come to terms with what happened. We will not sufficiently reinvest in our communities. And I think that’s the challenge for us now. It’s really articulate the scale of the problem, so that the appropriate scale of the public can come in and help us get it done.
Sullivan, 31:43
Oh, Jason, thank you What beautiful work you’re doing. And your wonderful constituency, both SSDP and MC ba. That’s great. Because, again, it’s about just educating people about what really is going on. That’s, that’s where I am just so passionate to show people what the real fact pattern is that a Steve even said, it’s not even about the health or issues with the plant. It’s about all these other things. Julie, Julie Goggin, welcome. I know you did fabulous work. Tell us what you’re working on. I know, working as an advocate for women is critical to you. Advancing opportunities again, education, tell us what you’re working on and what’s feeding your soul.
Goggin, 32:29
Thank you everybody, for having me. It’s been a delight to be here with such policy and legislative experts and man who practically invented this whole, this whole industry. I’m here to talk about industry, and the emergence of economic justice from a slightly different perspective, I think I’m aware and an entrepreneur and a new applicant for a cannabis cultivation license in New Jersey. And I spent a lifetime honing the kinds of skills that helped me in my communities, write labor force wrongs, and build new businesses. By far I much prefer to build and to fight. But both tactics are necessary, in my view. And similarly, I think that there is a two-pronged approach to ensure minority and women success in this burgeoning cannabis industry. I actually call these bricks and sidewalks. And I just want to riff off a couple of points that Candace made and Steve at the beginning. And I want to say that, in my view, a really healthy outcropping of all of these efforts would be to have big corporate cannabis, enterprise grow out of, you know, these communities, I want that the new businesses I want those new businesses, I, I equally want, and I think important are the smaller efforts and the access to for everybody. But I want the big deal to I want the big part of the pie. And so I’m going to start with a couple of like, in keeping with genes, instructions, data points, and anybody can contact me for the sources of the information. But entrepreneurship is on the rise for women and people of color. It’s a trend that’s been happening for a while access to capital is markedly less for those my communities for people of color and for women than for male and majority startups. Three institutional investors don’t invest the same way in my communities because they do not believe that the return on investment is going to be the same note that’s wrong for access to capital, a big factor in the success of businesses. So all those things together, mean that once all of the good work that is done happens and access for people of color, color and women is obtained. The challenge is from, from my perspective, to achieve the same kind of business success, that will huge business success that will really tilt the economic scales of justice. So it’s almost like a pie, the smaller efforts, you know, from, from a very broad base and a couple of big knockout blows. So I think that and Jeanne, thank you for the softball question that says, What are you working on? What do you think technology is going to be a really big factor because it provides for all businesses, efficiency, and access. And those things in this burgeoning industry are going to be critical, especially to new social equity players. So really quickly, in my metaphorical example, the bricks, the kinds of bricks are that about which I speak are things like, you know, fundamental pieces of information, and cannabis-specific pieces of information. I went and bought to see the Dawson’s book that is on how to grow a cannabis business. It’s a terrific book, that is a brick, there are others. Let’s talk about sidewalks, sidewalks are connections to the sources and supports of mentorship experience. And that’s really important, because you’ve heard all of these panelists talk about learning from legislative experiences, and economic experiences. And we should learn from the experiences of each other. And our successes and our failures. And, and frankly, it’s also the sidewalks are also a an access point to other value-creating factors that are important in the growth of startups here, business here and every other vertical. And the way technology can play a part here and when I’m working on is a platform that is a sort of all-inclusive platform that’s easily accessible to the new social equity players in this market. And that platform unifies a convoluted right now, ecosystem in the cannabis arena, and amplifies opportunities for entrepreneurs in the chain of cannabis distribution can provide innovative technology, there’s terrific stuff coming out of Colorado access to each other, you know, so some person right now in San Diego should talk to some person in upstate New York, maybe canvas to figure out, you know, a new way to extend a growing season to market something. And perhaps even website builders connect to a website builder who’s really good in this industry, sources of capital, I expect and anticipate that ArcView ventures and other, you know, major players will be supportive of this and other efforts to connect all the pieces and make it easier. And all we’re doing here in a way that hasn’t been done before in this industry is we are giving we are giving each other the access to the tools and to the supports that our majority brethren take for granted. So that’s my pitch.
Sullivan, 38:28
Well, I love what you said, as I told Candice, and you know this, Julie, I also just fiercely support women trying to help them get educated, to get funded. And guess what the research has been done. We know why it’s hard for women and people of color to get funding. We know why they get 2.2% of all venture capital funding. And so I know that in the efforts we’re doing in our field, we try to have that open door. That’s what it takes. And you know what else, the research proves that it takes women and men who understand this, to open the door to invite women and people of color in to show us your companies. That’s what’s missing. We need more and more people who get that as an investor. And so we’re trying hard to do that, too. So I thank you for that. Aaron, Patrick, and we have some questions.
Gorman, 39:29
Please, if I may, we’ve got some nice things coming in from the audience, including one of our very esteemed guests, the founder of NCRC, John Taylor, whom we all love, and who has been a hero for decades in this space around the issue of access to capital. And this is just another new opportunity. He wanted to make sure there was room here for this discussion because he knows the people that are in the audience are critical to providing access to capital that’s needed. And many of them want to do the right thing and they’re just trying to find the path to get it done. So one question that came up from John was, is there anything For legislation happening right now on Capitol Hill. And I think I’m going to just take a quick shot at that answer. And then we’re gonna also pass that around a little bit Jean at your convenience. I’m going to throw another question. on Capitol Hill, it’s been very interesting to watch. There are D’s and R’s, who want to move all of this forward. And there are some DS and Democrats and Republicans who just want to move the money piece forward. So we saw that safe banking just got passed again by the house under Nancy Pelosi. But we also heard Saturday, Chuck Schumer said he is not bringing safe banking to the Senate. It’s too easy to vote. We already know that the wealthy people, whether it’s insurance companies, banks, they want this because there’s an opportunity for profit. So that’s something that will be moved through the legislation. And Schumer said, No, we got too much work to do we have too much social equity. Do we got to make sure we do this whole thing? Right before we go forward? That’s kind of my perspective, I’d be interested in other people’s perspective. The second question, is that kind of set of questions that have come in, have been around taxes, and the use of those taxes? Where are they going locally? Some of the men called reparations, some are going to very specific groups. What can be done about that? What’s the best practice on that? Wow, how should that be done? So those are the two questions federal legislation and how to use the money on going back to Eugene.
Sullivan, 41:19
Thank you, Patrick. Let’s start with the second question. Because the sheeta that’s exactly what’s important to you. How are these various tax revenues going to be deployed? I think it’s critical. speak to that. But then and tell us your thinking and analysis on that. Plus, not only in Portland, but your wonderful work in New York State to help with these regs. So talk to us about that very issue.
Dawson, 41:43
Yes, thank you so much, Jeanne. And thank you, everyone. For the comments. I’m over here head nodding, because I feel like I’m at church, listening to things that people are saying that completely are aligned with my thinking. So I came from the private sector, entering the industry as a management consultant and a strategist. And I chose to move to the public sector and now a government official and regulator overseeing the legal cannabis industry for the City of Portland. And I did so because for me, what I felt was missing is this idea of what was happening with this new revenue for municipalities and for states. And when we started to dig into it deeply, even in the city of Portland, despite the people voting for this revenue to be returned back to the communities that have been most harmed and impacted by cannabis prohibition, still 80% of the revenue was going to the public safety or the Police Bureau. And when we peel back the layers of all of the states that are legalized before 2020, we see that that’s a common denominator. And so I’m very excited because part of my role has been overseeing one of the first equity center and regulatory offices in the country, whereby cannabis tax revenue is tied to a Community Reinvestment Fund. We call it the social equity and educational development or seed initiatives. And essentially, this was started in 2016. And I really got the opportunity in this last year to build it out in a bigger way because our city council decided that we needed to get an ongoing allocation out of the cannabis tax revenue. And then going on to testifies work with the majority leader, Crystal people Stokes, the mother of the marijuana movement in New York, to ensure that New York’s massive cannabis tax revenue has an allocation for community reinvestment funding and grants, and so 40% there, but we also have 30% in Illinois, which is tracking to be $1 billion dollars in cannabis tax revenue. It’s already surpassed alcohol. So we’re talking about a ton of funding that until recently hasn’t been prioritized for black, indigenous and Latin x communities. And so when I saw that question come in, I thought, also, how do we make sure it goes to the right places, we have to actually write the policy to make sure it does that. And that’s at the regulatory part. And until recently, we haven’t really seen that many people of color, even in the regulatory leadership, I was only the third black woman to have this role in the country. And thankfully, we now have a fourth and a fifth, but we are expanding and I think part of it is that we recognize coming from Brooklyn, New York, Brooklyn, born jersey educated, we recognize all the experiences that Jason talked about where equity has been missing, and it’s a much larger conversation. I really quickly just also mentioned that for us. I think social equity is the vehicle but health equity or total equity is that destination we’re trying to get to so while we talk about licensing that is also very important. These were communities that were disinvested in in a very systemic and systematic way. And so we have to be the same in the opposite direction. We have to be very systematic in the way we use the cannabis tax revenue. For New York. There’s an advisory board that will be assembled for us. We have a selection committee to sure that we are putting that grant money back into the communities and in a more for us by us model, what does that mean is black indigenous and Latin x led organizations and companies that are benefiting from the cannabis tax revenue allocation. The last thing I’ll say is we can amplify it. So again, I came from the private sector, working with companies like Target and Victoria’s Secret and United Way. And public-private partnerships can help amplify this. And that’s why I also want to see the initiatives to really have a brand behind it to ensure that companies like a Nike, which is based in Oregon, if you want to support community reinvestment, you can do so by partnering with what we’re doing currently within the city. And I think that that’s what’s been missing is how do we find the ways to funnel money in a more productive way that the private sector can contribute to larger government-led resources? And, and, you know, programming?
Sullivan, 45:59
Wow, amazing. Thank you for your hard work. So one thing that turning to safe banking, first of all, that acronym stands for secure and fair enforcement Banking Act of 2021, now called for the last two years pre COVID. I got to go to the hill and go to lobby days for MCA, which is the major trade association for the cannabis industry. Well, that was an eye-opener. Oh, my Golly. And all we focused on was safe banking. Now, I would say to all of you who doesn’t want safe banking, but first, even though we understand what’s going on, I want to make sure our audience understand what is the current state of the art for a license holder, a grower for a business owner around using a bank, or using you know, the vast number of thank god of state and local and credit unions that have had to step in? Steve, you’re the perfect one being a long-time license holder, the founder of harbourside, what happens with Baylor either a license owner or business owner today for the need and use of cash paying people in cash. Talk to us about first What’s going on? regarding that, and then we can get into what could these all laws do potentially?
DeAngelo, 47:24
Well, Jeanne, the basic story is that the cannabis industry continues to, for the most part get by without the type of banking services that every other American business has access to. And we are beginning to see more credit unions who are beginning to provide basic services. But it can be very difficult even so I’ll give you an example. You know, harbor side, which I’m no longer affiliated with, but when I was affiliated with it, we were one of the largest and you know, most respected cannabis businesses in the state of California. And even we were unable to find a bank, that would give us just a basic bank account where we could deposit money and write checks. So what we had to do is we found we found one bank repository that would allow us to send armored cars with cash and deposit the cash there. But they would not allow us to write checks. And so we had to move the money from that repository into a credit union account that would allow us to write checks, doesn’t seem like a big deal. But transferring those funds was really slow. It took us about two to two and a half weeks to transfer those funds. And when you’re running a business that’s doing 60 or $70 million a year and has an inventory to maintain that kind of lag time can get to be very, very burdensome and very expensive. And this was harbor side which was very well equipped to manage these kinds of situations, smaller operators, less sophisticated operators, operators of color, are going to find even greater challenges. And so what happens is many people just have to get by on a pure cash economy. And, you know, I had a heartbreaking message from from from one of these people in the past few days. A gentleman who has a cultivation license, who’s worked really, really hard to get that license and maintain it over the years. He has a balloon payment due on his mortgage, he’s got the cash to make the payment, no problem at all, but the bank won’t accept the cash payment. And so now he’s facing the prospect of losing his livelihood, his property and his business all in one blow because of the broken banking system. So it is something that’s having really heartbreaking consequences. And in some cases, life-threatening consequences, you know, we know that cash-rich businesses, our target did buy for armed robbery and for burglary, harbourside to certainly suffered from that kind of targeting. And I don’t I think that it’s a rare cannabis business that hasn’t suffered from that sort. We’ve seen deaths occur in cannabis dispensary robbery. So it’s an urgent matter both for, you know, decent, basic functioning of the business for a just economy, and also just for public safety to make sure more people don’t die.
Sullivan, 50:29
As I said, Who doesn’t want safe banking? This is a travesty. This is craziness. Are there other war stories anyone wants to share? Patrick, go ahead.
Gorman, 50:44
Sorry, if that was there, you know, who doesn’t want safe bagging? The large msos they’ve got to figure it out. They don’t need to, this is not an issue for them. Some banks are willing to take a risk. Of course, the big issue we’re talking about here is it’s a schedule one drug. If you’re an institute, you touch a schedule one drug, you’re you’re potentially subject to forfeiture of all of your assets. Obviously, community banks have gotten heavily involved. But I know msos that are trying to keep safe banking from happening. Because it means more competition. And then without getting too deep around some of the stuff that seed is brought up to 80. That’s a tax issue. But it’s an issue where you’re not allowed to get get the tax benefits for your equipment, your machinery and your payroll. Then there’s crop insurance is an issue. You can’t get crop insurance for cannabis. If you can’t get crop insurance, how are you getting a USDA loan? So there’s so many different levels, and so many different ways that you get stopped and then you met, then you bring in the people who should be successful in the space that people of color. And it looks to me like it’s created a real issue for the financial services, trying to figure out how do we get in? How do we help? How do we grow because there’s profit? And maybe because we want to do the right thing? With all those factors going on? I’m not sure what the answer is crazy. Well, what
Sullivan, 52:01
Crazy, well, what could be off first, are there other stories around use of cash? I’ve heard people have terrible problems. Go ahead to Dasheeda.
Dawson, 52:08
Well, in the state of Oregon, we’ve been having a real issue with the increase in robberies and armed robberies and burglaries. And Oregon is a state that doesn’t require armed security. And it’s sort of changed the way we’re thinking about regulation where it’s been a lot more come in and actually interact with the plan. Whereas now it feels like we need to protect our operators. We’ve been working with Representative Earl bloomin hours team to try to figure out exactly what we need to do to be able to protect our operators. But we’re also to Patrick’s point, struggling with crop insurance, we had an orange sky earlier last year, as the California there was a lot of wildfires. So on top of COVID, what we’ve seen are another set of emergencies that have been illuminated that if you’re not a big operator already in the space, you’re going to be suffering from all these additional costs just to keep up. And so we’re seeing that about 75% of our Oregon operators are 2 million, as far as top line revenue or less, and they are really struggling. And so Patrick is right, I think most of the msos and from my experience, they have conglomerate, companies meaning 10 or more in order for them to facilitate their movement of money. And most of the operators in the cannabis space are actually not that sophisticated. And and we’re seeing them struggle on their their their ability to stay open and stay afloat, even though cannabis was deemed essential category. So it’s sort of like a catch 22. There’s also this really, really false belief that because the revenue is going up, and people are certainly buying more and participating more that categorically everyone is doing well. And I would say again, those smaller operators are definitely struggling to keep up without having proper banking in place.
Sullivan, 53:59
Thank you, Dasheeda. Jason, share your story.
Ortiz, 54:03
Sure, as President of the minority cannabis Business Association, we didn’t touch the plant and we had trouble getting a banking access. And we had our bank shut down multiple times, our executive director couldn’t get life insurance as a new mother. And it caused all kinds of problems. So the safe banking thing ripples out to those that aren’t even necessarily touching the plant, but simply want to advocate for it. We also couldn’t get a 501 c six status through the IRS banning any organization that was talking about cannabis from being able to get a federal status. And so banking solves a lot of different things. But I think the biggest problem here and one of the bigger problems with cannabis work in general, it’s not that folks outright oppose it. Although I will say the status quo of prohibition supports not having safe banking, but it’s making it a priority. And that is where we need public pressure and public engagements to make sure that every representative knows that this is important that you want to do it comprehensively. And that’s why we support the grassroots organizations that are actually doing the work because if we don’t have organizations, there’ll be no groundswell to demand it, and the politicians won’t feel pressure to do it. So that’s why I do them. We have to support words like, of course, SSDP, the minority cannabis Business Association, minorities for medical marijuana, because I just want to, you know, educate folks a little bit that these organizations exist, there are lots of people of color organizing and trying and doing the work and seeking, you know, solutions writing the policies. ncba literally has written multiple model policies that anyone that can use, but some of our biggest opponents are the same msos, right, that we’re fighting on safe banking. So for those folks that are outside of the cannabis industry that can maybe help us build a stronger grassroots network. That’s another place that we definitely need your support, because we can fight for safe banking. But if we don’t have the resources to be in every congressional office, we’ll never get it done.
Sullivan, 55:45
So I, I thought, surely, with the blue Senate, we had a chance for safe banking and these reforms to finally happen, because again, just a little small history lesson. The former head of the banking committee, was a Republican Senator Mike crepeau. And he would not even let these discussions go to the floor, he termed out so but we got a blue Senate, and that puts Senator Sherrod Brown as head of that Banking Group. I thought Surely this is going to happen now. I even put myself out there and said that at many webinars, it hasn’t happened. And now those of us on the inside think, oh, there’s some issues. Aaron, go ahead.
Kirk, 56:36
I just wanted to say that I think I’ve relayed to representative Hughes and Representative Porter, I’ve had my physician here in the state of Connecticut, literally a 67 year old doctor practicing for 40 years at a yell taken by armed guards out of patriot bank, near where she has her office where she went to simply make a transaction. She was not carrying cash or anything. And she was met at the door by the bank manager, who in public called her a pot dealer, any pot doctor and literally threw her out the place. This was reputational damage. This was financial damage. And you know, we want to get into ages and other discriminations. We can’t so this is affecting so many different people, this lack of safe banking, even my physician, it’s just terrible. So I just want to give that piece of anecdotal evidence on a different level.
Sullivan, 57:29
So what are we thinking? Steve, I will look to you, is there going to be a solution before the midterms? That’s what I’m hoping for. And I am counting on our Senator Chuck Schumer to make this happened.
Kirk, 57:42
And we have one minute. Sure.
Sullivan, 57:44
Sure, so weigh in on what do you think, Steve?
DeAngelo, 57:48
I am cautiously optimistic. I think that Schumer realized that you cannot pass the safe Banking Act and still have 40,000 people in prison in the United States on cannabis charges. You cannot pass the safe Banking Act for billionaires and not do something to make sure that social equity is a reality in the this industry, if we’re going to take care of the billionaires, we have to take care of everybody else too.
Sullivan, 58:14
Thank you so much, Patrick, to you.
Gorman, 58:18
Well, we want to end as we began, which is thanking NCRC for being so far out in front on this issue and so many issues. When people didn’t care, NCRC care, John Taylor cared and built an organization and worked. And it’s an institution, it’s the results are incredible. We’re all honored to have played a role in this. This is an area that we all care an awful lot about. I just want to close with a few words that I heard today. It’s the power of the public. And it’s the wisdom of the public. And we’ve got to bring that to the legislators. We also have to bring that to the finance seers. It’s not what you’re saying it’s what you’re doing. So I think together if we can all have more conversations, everybody in the audience, if you can go back to wherever you work, talk, start talking to more people, we will pull this issue forward, and we’re going to create success. And the more we work together, the faster it’ll happen. Thank you very much, everybody for participating today.
Kirk, 59:16
Thank you.
Hughes and Porter, 59:19
Just economy go fight win.
Sullivan, 59:21
Yay. That was great.
