The State of Equity in Midwest Cannabis: Detroit
It was the best of times, it was the worst of times, in Detroit last week when the eagerly anticipated Adult Use Marijuana Ordinance came to fruition last week.
The long and short of social equity access boils down to a hyper local level. How many businesses will be allowed, where are the “green zones” or real estate landscapes of where the businesses can be located.
Detroit released regulations for adult-use marijuana establishments, and authorized business licenses for co-location, and adult-use marijuana establishments including grower, processor, retailer, secure transporter, safety compliance facility, microbusiness, marijuana event organizer, temporary marijuana event, and designated consumption establishments.
The city took this one step further. Councilman James Tate, with the support of Detroit Mayor Mike Duggan announced a Legacy Detroiter designation allocated to the Civil Rights, Inclusion, and Opportunity Department. This differs from, and does not mirror, the State of Michigan’s social equity program which requires a current, 5 year residency. Legacy Detroiter has a residency requirement of 10–15 of the last 30 years.
Recognizing that long term residents of the city of Detroit have historically been excluded from ownership opportunities in the legal marijuana industry due to the disproportionate impact of marijuana prohibition, enforcement, and the lack of access to capital, land, and resources; that more than 30% of Detroiters live below the federal poverty level; that Detroit has a marijuana-related criminal conviction rate that exceeds the average marijuana-related criminal conviction rate in the recognition that employment opportunities in the legal marijuana essential for Detroiters, and to strongly encourage and incentivize licensees under this article to ensure that at least 50% of its employees are Detroit residents, specifically those Detroit residents who are veterans, low income, or have a prior conviction.
Licenses are to be awarded as following:
- No less than 50% of licenses for adult-use retailers, adult-use processors, adult-use growers, designated consumption establishments, microbusinesses, and marijuana event organizers shall be granted to Detroit legacy applicants.
- The City shall not issue a license for an adult-use retailer, adult-use processor, adult-use grower, designated consumption establishment, microbusiness, or a marijuana event organizer if such issuance would cause the number of licenses held by Detroit legacy licensees to be less than 50% of the total licenses held in each respective category.
What is at stake here:
Data provided by Michigan Marijuana Regulatory Agency, September 2020
The complexity is, this assures that ½ of existing medical marijuana retailers would not be awarded adult use licenses. Left “dying on the vine”, unable to transition from medical to recreational, would typically lead to litigation.
More interesting, the ordinance came with a “poison pill” designed to discourage such actions. Should any provision of the ordinance governing adult-use marijuana establishments be ruled invalid, unconstitutional or struck down by a court of law, the ordinance will be repealed, and future adult-use marijuana establishments will be prohibited.