Oakland's Equity Permit Process

February 5, 2018

When it comes to cannabis business permits, Oakland is trying something different. In an attempt to both jumpstart growth and also create a more equitable cannabis industry within the city, the city has created a permitting process called the Equity Permit Program. As part of this unique program, half of Oakland’s eight medical cannabis permits are reserved for what they term “equity applicants”: residents of Oakland whose income is below a certain threshold and who have either been convicted of cannabis-related crimes sometime in the last thirty years or live in areas where anti-cannabis laws have been disproportionately enforced by Oakland police. In the end, thirty-six equity applicants were up for these spots -- and on January 31st, the first four recipients were picked by lottery.


The goal of the program is, in the words of the City Council, “promoting equitable ownership and employment opportunities in the cannabis industry in order to decrease disparities in life outcomes for marginalized communities of color and to address the disproportionate impacts of the war on drugs in those communities.” Importantly, it’s also designed as a temporary measure until the more comprehensive support structure of Oakland’s upcoming Equity Assistance Program can be put in place.


Some of the objections early in the debates surrounding the efficacy and appropriate implementation of the Equity Permit Program dealt with the discrepancy between Oakland’s good intentions and the requirements set out by the state. Cannabis business operators in California must secure both city and state permits in order to operate legally, and no matter how principled the Equity Permit Program, it would all be for nothing if every equity applicant were blocked from acquiring a state permit on the basis of prior convictions. Additionally, there were concerns that the structure of the process could inadvertently stunt the growth of the Oakland cannabis industry in two ways: first, that the extra amount of paperwork required could cause bottlenecking in the permitting process for non-equity applicants, and second, that the residency requirements would discourage entrepreneurs from outside the city who would otherwise qualify for an equity permit from investing in the city’s cannabis industry.


However, those fears have proven thus far to be largely unfounded. Though the state has said that it reserves the right to deny permits because of cannabis crime convictions, they have yet to intervene in or even make a strong statement about Oakland’s permitting process. Also, a relatively equal ratio of equity to non-equity applicants has also ensured that there have been few, if any, delays in processing the paperwork for all applicants.


The winners of January’s lottery have a few more administrative hoops to jump through before they’re officially approved for their permits; in many ways, the process is only just starting. As such, meaningful analysis of the program’s outcomes are still a ways off. But in the meantime, perhaps the most useful lesson Oakland has for the rest of the country is that cannabis legalization alone doesn’t erase existing inequalities and injustices, whether historical or ongoing. One of the greatest things the Equity Permit Program has going for it is how specifically it is tailored to Oakland’s unique history, and how its current form was allowed to take shape through dialogue between city officials and community members. Transplanting the nuts and bolts of their approach wholesale is an uncertain recipe for success, but if more cities were to follow Oakland’s lead by running the numbers and reckoning honestly with their individual histories of unjust policing and incarceration, the resulting policies could very well create a more equitable industry nationwide.


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