July 16, 2017

 

Our Recommendations for Oakland's Cannabis Equity Assistance Program

Since Oakland’s city council passed legislation in March 2017 regulating the entire Oakland cannabis supply chain, The Hood Incubator has been on the frontlines engaging Black and Brown communities to increase awareness and preparedness for the application release.

 

Since the release of the application, The Hood Incubator has done extensive street outreach to disseminate information and to invite folks to a series of co-hosted events. The purpose of these events was to:

 

  • Assist Black and Brown community members interested in entering the cannabis industry to complete the permit application

  • Connect equity applicants with investors and/or business incubators

 

Over fifty (50) guests attended our first application workshop. Of the twenty five (25) attendees who were equity eligible, only four (4) were readily able to gather the required supporting documentation, meaning 84% of attendees faced challenges locating and securing these documents. Based on these experiences, we believe the City of Oakland can enact measures to further ensure the success of the Equity Assistance Program.

 

Below are The Hood Incubator’s recommendations to increase the overall efficacy of the Equity Assistance Program:

  1. Direct city staff to release the RFP for the technical assistance consultant

    • Only twenty five (25) completed equity applications have been submitted and nineteen (19) or 76%  of those do not yet have a business location identified, implying that a majority of equity applicants are looking to participate in the Incubator program.

      • It is clear that Equity eligible populations are not sufficiently aware of this Cannabis Assistance opportunity. The pool of individuals operating in the informal cannabis market who qualify as equity applicants is far greater than the number of equity applications that have been submitted to date.

    • Of the twenty two (22) completed general applications that have been submitted only eight (8), or 36%, have shown interest in participating in the Incubator Program. If this disparity persists, the cannabis industry in Oakland can potentially be at a standstill as a bottleneck develops.

    • A targeted outreach effort needs to take place to reach both equity applicants & incubator applicants. The RFP needs to be released so that an organization can be capitalized to take on that task.

  2. Direct city staff to add additional items to the list of supporting documentation for equity applicants​​

    • SSI/SDI, Food Stamps, and/or Medi-Cal would be more appropriate documents to prove income for the targeted audience.

      • Consider that the targeted audience has been locked out of formal systems (i.e. education & employment) making it less likely there is a tax return to file.

    • In addition to the documents used to prove income, Section 8 verification would be more appropriate documents to prove residency for the targeted equity audience.

  3. Direct staff to form an inter-departmental working group in collaboration with each other and with experts and stakeholders to support staff in applying existing codes (especially Building & Fire) to specific cannabis uses based on their zones and specific structure types

  4. Direct city staff to clarify the income threshold for equity applicants.

    • Equity applicants are confused enough by the overall application process, the income threshold should be an easily recognizable figure and respected formula. Equity applicants should be measured against 80% of Average Median Income (AMI) for the San Francisco-Oakland-Hayward Metropolitan Statistical Area (MSA). As of 2015, this AMI figure is $81,552 80% of this AMI calculates out to about $65,242. (Source: 2015 American Community Survey, Census.gov)

 

Supplemental Recommendations below:

 

  1. Direct city staff to craft a policy (and ordinance, if needed) to rationalize tax policy to maximize Oakland’s competitive edge against other jurisdictions jockeying for supply chain industry market share.

    • Appropriate tax policy affects ALL legal cannabis business owners; enacting the most competitive tax rates will ensure that equity permit holders are able to establish sustainable businesses in Oakland.

  2. Direct city staff to immediately craft an adult use ordinance and implement adult use licensing based off the MMJ model that passed with a 8-0 City Council vote this past March 2017.

    • A large number of Black and Brown cannabis consumers do not have MMJ cards nor do they plan to get MMJ cards. Implementing adult use will increase the consumer pool for equity applicants, thus resulting in a more robust and sustainable equity program, and overall Oakland cannabis industry.

  3. Direct city staff to provide an informational report containing: a list of available eligible City-owned properties for cannabis cultivation/manufacturing (uses in 5.81), and a method for applicants to contact to consider lease/purchase;

    • Furthermore, these identified properties should be prioritized for equity applicants, considering the disparity in equity applicant's ability to secure a location versus general applicants

  4. Direct city staff to provide a budgetary resolution that sets aside 20% of cannabis tax revenue and establishes a citizen oversight committee for those funds. The committee should use the process of participatory budgeting to release the funds to various community focused needs.

    • The majority of Black and Brown individuals who have been victimized by the war on drugs are not planning to enter the formal cannabis industry in any capacity. Nonetheless, their communities should still receive benefits and relief from the legalization of cannabis, given the overall burden borne by these disportionately policed communities. Establishing such a fund creates an opportunity for this negatively affected community to benefit from the future cannabis tax revenues the city will receive.

All donations to The Hood Incubator are 100% tax deductible via our fiscal sponsor, Social Good Fund     (Tax ID # 46-1323531)

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