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Black Cannabis Entrepreneurs Say State’s $30 Million Fee Waiver Fund May Not Be Enough

The program creates pathways for individuals affected by the War on Drugs to enter into the cannabis industry. Potential business owners who are living at or below 60% of the Area Median Income; who were previously convicted or arrested for a cannabis-related offense; or who live in a community negatively impacted by past cannabis policies would be eligible for the program.

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“There is no doubt that the War on Drugs has disproportionately harmed people of color and their communities,” said Sen. Steve Bradford (D-Gardena), who is also chair of the California Legislative Black Caucus.
“There is no doubt that the War on Drugs has disproportionately harmed people of color and their communities,” said Sen. Steve Bradford (D-Gardena), who is also chair of the California Legislative Black Caucus.

By Edward Henderson | California Black Media

Alphonso “Tucky” Blunt, owner of a marijuana product store in Oakland called Blunts and Moore, says his business is located in the same zip code where he was arrested for selling weed illegally in 2004.

Now that he is legit in the business – he opened his store in a little over three years ago — Blunt says it is nearly impossible for Black and other minority-owned cannabis startups like his to make a profit in California.

“Where’s the tradeoff? I’ve been in the business for a few years and I’m still in the red. California has one of the highest tax rates on cannabis businesses anywhere. Oakland is in the top four of anywhere in the country,” said Blunt. “We also pay the most for armed guards. It costs like $25 to $30 per hour. The city requires us to have them – unlike Berkeley where they are not required. But police respond faster there.”

Blunt says the challenges cannabis businesses in the state face are many, including the fact that they have to pay federal taxes but can’t write off any expenses because cannabis is not legal on the federal level. Businesses like his also have challenges banking because of federal restrictions. Plus, criminals frequently target cannabis businesses and when they do, insurance companies are typically unwilling to pay for damage or lost products, Blunt says.

To address some of the challenges minority entrepreneurs in the industry are facing – particularly those who were victims of the War on Drugs – legislators in California have taken a number of steps to lower barriers to entry in the industry.

“There is no doubt that the War on Drugs has disproportionately harmed people of color and their communities,” said Sen. Steve Bradford (D-Gardena), who is also chair of the California Legislative Black Caucus.

In 2019, Bradford authored SB 595, which established a cannabis equity fee waiver program. The Legislature passed that bill and the governor signed it into law the same year. The program was contingent on funding Bradford successfully obtained for its implementation in the Budget Act of 2021.

Right now, California is in the process of approving a $30 million fund that will eliminate business fees for some entrepreneurs entering the cannabis business in the state.

Last week, the Department of Cannabis Control (DCC) released the regulations it will follow to implement Senate Bill (SB) 166, the budget trailer bill Gov. Gavin Newsom signed into law in September establishing the fee waiver program.

The program creates pathways for individuals affected by the War on Drugs to enter into the cannabis industry. Potential business owners who are living at or below 60% of the Area Median Income; who were previously convicted or arrested for a cannabis-related offense; or who live in a community negatively impacted by past cannabis policies would be eligible for the program.

The waivers go toward licensing fees for their potential businesses, which can range from $1,205 to $77,905. The DCC will start accepting fee waiver requests beginning Jan. 1, 2022.

The California Office of Administrative Law will publish the proposed regulations as being “under review” on its website: https://oal.ca.gov/. DCC will share instructions for submitting a public comment and participating in the regulatory process. The agency will also announce when the comment period, which will last five days, is open to the public.

“SB 166 is part of my continued mission for the Government to atone for the wrongs inflicted on people by supporting them with opportunities to enter and thrive in the cannabis market. I encourage anyone interested in the cannabis industry, especially equity cannabis applicants and operators, to provide comments during the short window for feedback.”

DCC Director Nicole Elliott says the state will continue to invest in opportunities to make the licensing businesses more equitable, particularly for people who were impacted by the War on Drugs.

“We know access to capital remains a persistent challenge for California’s equity applicants and licensees,” she said. “These waivers aim to address this challenge for those who need the most financial support.”

Bradford said for government to truly understand the challenges entrepreneurs are facing, they have to make their voices heard and talk about the barriers to entry they face.

“These regulations are extremely important for determining who will and will not get application, licensing, and renewal fee waivers, and the amount of help they will receive,” said Bradford. “It is vital that the Administration have an accurate understanding of people’s experiences in order to create a framework that respects them.”

Blunt says he welcomes the $30 million investment the state is making to help with licenses and other costs but entrepreneurs like him need more.

“We need a two-year tax break. We have to pay some sales taxes but the extra cannabis taxes we pay, we need the break to recover. We can save some of that money and reinvest in our businesses and have some money for security,” says Blunt. “My business makes around $5 million a year, but the money I spend on security and taxes alone is easily in the $2 to $3 million range — and I’m not counting other expenses like payroll and other operational expenses. How will we ever make a profit?”

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Activism

Through Ads and Advocates, Battle Over Calif. Gambling Propositions Heat Up

A statewide survey by the Public Policy Institute of California (PPIC), conducted between Sept. 2 and 11 and released on Sept. 15, revealed that 54% of California voters would vote “no” for Prop 27, while 34% would vote “yes.” Twelve percent of the respondents were “unsure.” The survey’s authors wrote that a strong majority of Republicans wouldn’t vote for the proposition, compared to half of Democrats and independents.

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The dueling propositions have raised a combined $400 million for advertising leading up to Election Day this November.
The dueling propositions have raised a combined $400 million for advertising leading up to Election Day this November.

By McKenzie Jackson | California Black Media

Clint Thompson, a Santa Monica resident in his 30s, wouldn’t say he has been inundated with advertisements supporting or denigrating Propositions 26 and 27, but he sees an ad focused on one of the legislations each time he turns on his television.

“I usually watch the news during the day — NBC — and on NBC, Prop 26 or Prop 27 comes on every other commercial break per show,” said Thompson, an actor, who admitted he hasn’t researched the sports gambling propositions. “Both of the props seem to have good things with them. The commercials seem to have reasons why you should say ‘yes,’ or ‘no.’”

Prop 26 would legalize roulette, dice games, and sports betting on Native American tribal lands if approved by voters in the Nov. 8 election. It is backed by over 50 state Native American tribes.

Prop 27, supported by sportsbooks DraftKings, FanDuel, BetMGM, Fanatics, PENN Entertainment, and WynnBet, would give those sports betting companies the reins in sports gambling in the Golden State and allow online gambling.

If people like Thompson feel the advertisements from the campaigns for and against the propositions seem to be flooding the television and radio airwaves — and to be ever-present on social media (Watched a YouTube video lately?) — they might be right.

The dueling propositions have raised a combined $400 million for advertising leading up to Election Day this November. That has led to ads backing and slamming the two propositions to be front and center in all forms of media Californians consume.

Dinah Bachrach of the Racial Justice Allies of Sonoma County, a group supporting Prop 26, said the proliferation of ads supporting Prop 27 is concerning.

“They are all over the place,” Bachrach said. “Gambling is already a pretty big business, but to be able to do sports gambling online is dangerous because it hurts what tribal casinos have been able to do for their communities in the state.”

According to Bachrach, Prop 26 protects the sovereignty of native tribes. “It’s a really important racial justice issue,” she said. “Indian casinos provide a tremendous amount of financial support for the casino tribes and the non-casino tribes, and they contribute a lot locally and to the state.”

Bachrach’s organization is one of several civil rights or African American organizations that have thrown its support behind Prop 26.

Santa Clarita NAACP spokesperson Nati Braunstein said in an email, “The NAACP supports Prop 26, which would legalize retail sports betting at California tribal casinos only and opposes Prop 27 which would allow online sports betting via mobile sportsbooks.”

Kathy Fairbanks, speaking for the Yes on 26/No on 27 coalition, composed of California Indian tribes and tribal organizations, and other partners, said winning the approval of every potential voter, including Black Californians, is their goal.

Yes on 27 – Californians for Solutions to Homelessness, the campaign arm of Prop 27 backers, had not returned California Black Media’s requests for comment for this story as of press time. Prop 27 proponents say in ads and the Yes on 27 website repeats that the initiative would help solve California’s homelessness crisis.

Prop 27 imposes a 10% tax on adjusted gross gaming revenue. Eighty-five percent of the taxes go toward fighting California’s homeless and mental health challenges. Non-gaming tribes get the remaining 15% of tax revenue.

Organizations such as Bay Area Community Services, Sacramento Regional Coalition to End Homelessness, San Diego Regional Task Force on Homelessness, and individuals including Long Beach Mayor Robert Garcia, Oakland Mayor Libby Schaaf, Bay Area Community Services CEO Jamie Almanza, and Middletown Rancheria of Pomo Indians Chairman Jose “Moke” Simon are listed as Prop 27 supporters on the Yes on 27 website.

On the campaign’s Facebook page, commenter Brandon Gran wrote under an advertisement photo that voting for Prop 27 was a “no brainer.”

“People are already gambling using offshore accounts,” he typed. “Why not allow CA to get a piece of the pie … money that will (hopefully) go to good use.”

However, a statewide survey by the Public Policy Institute of California (PPIC), conducted between Sept. 2 and 11 and released on Sept. 15, revealed that 54% of California voters would vote “no” for Prop 27, while 34% would vote “yes.” Twelve percent of the respondents were “unsure.”

The survey’s authors wrote that a strong majority of Republicans wouldn’t vote for the proposition, compared to half of Democrats and independents.

“Regionally, majorities in the Inland Empire, Orange/San Diego, and the San Francisco Bay Area would vote ‘no,’ while likely voters in the Central Valley and Los Angeles are divided,” they wrote. “At least half across most demographic groups would vote ‘no.’ Likely voters age 18 to 44 (52%) and renters (51%) are the only two demographic groups with a slim majority voting ‘yes.’”

The survey, titled “PPIC Statewide Survey: Californians and Their Government,” did not ask participants about Prop 26. The Yes on 26/No on 27 coalition, said in a news release that the PPIC’s research confirmed what Prop 26 supporters have said for some time.

“Despite raising more than $160 million for a deceptive advertising campaign, California voters are clearly not buying what the out-of-state online gambling corporations behind Prop 27 are selling,” the statement read.

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Activism

Oakland Promise and Kaiser Support Promising Student

Kaiser Permanente gave a significant grant to Oakland Promise, helping it reach a $50 million goal for its Generation Fund, which will offer college savings accounts and scholarships to all low-income Oakland public school students while they’re pursuing college degrees or trade certificates.

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Kaiser Permanente partners with Oakland Promise to cultivate mentor program, scholarships, academic guidance. Pictured, Kaiser Permanente mentor Ingrid Chen, MD, at right, with Sandy La, who begins her second year of college this fall.
Kaiser Permanente partners with Oakland Promise to cultivate mentor program, scholarships, academic guidance. Pictured, Kaiser Permanente mentor Ingrid Chen, MD, at right, with Sandy La, who begins her second year of college this fall.

By Carla Thomas

When Sandy La applied to two programs while a senior at Oakland High, she had no idea the Oakland Promise program would truly reward her for being a promising student on the rise. Now a successful student at UC San Diego majoring in Public Health, La has spent over 12 months mentored by Kaiser Permanente Oakland psychiatry resident Ingrid Chen. For Chen, mentoring a student and just being there for her was key.

Kaiser Permanente gave a significant grant to Oakland Promise, helping it reach a $50 million goal for its Generation Fund, which will offer college savings accounts and scholarships to all low-income Oakland public school students while they’re pursuing college degrees or trade certificates.

“The program is very well organized, and very accessible for busy working people,” said Dr. Chen. Kaiser Permanente is partnered with Oakland Promise to cultivate mentor programs, scholarships and academic guidance.

La was one of the lucky few of 300 to 400 Oakland high school students who received college scholarships ranging from $2,000 to $16,000 each year from Oakland Promise, and Dr. Chen is one of the 34 mentors from Kaiser Permanente who help keep them in college, often forming long lasting friendships.

“When I first moved to Oakland in 2020 to start my residency, the social justice movements spotlighting racial inequality in our society inspired me to help the community,” said Dr. Chen. “My parents are first generation Taiwanese immigrants, so I have a heart for immigrant families and other groups that are often marginalized in society.”

Dr. Chen makes herself available to La and one other student to talk about anything and help them identify opportunities in college and beyond.

“It’s been great to have someone to talk to and support me,” said La, who says the extra support really matters.

Dr. Chen says it has been great getting to know La and supporting her. La says the support has been a great confidence booster and she now pays it forward while counseling incoming freshmen. “I’m majoring in public health because I want to make a difference in health care and solve some of the disparities in the field,” said La.

Kaiser Permanente is also a founding sponsor of Oakland Promise, said Yvette Radford, Kaiser Permanente Northern California vice president of External and Community Affairs. “Oakland Promise is creating brighter futures for children and families by supporting children at every stage in their lives, from the day they’re born to the day they graduate from college,” said Radford. “This innovative public-private partnership is helping Oakland’s children become more successful in school and in life.”

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Activism

Meet the Woman Who Spearheaded Equity, Inclusion in the Business World

Among many things, Mason Tillman Associates conducts disparity studies that show how equitably or inequitably governments distribute contracts to outside businesses. “We have been able to improve the lives of many minority and woman business owners,” said Eleanor Ramsey, president and CEO of the firm Mason Tillman Associates, adding that the work has been helping them secure contracts and improve profitability.

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Eleanor Ramsey, president and CEO of Mason Tillman Associates, a consulting firm that shines the light on unfair practices in government contracting nationwide. (Pat Mazzera/Mason Tillman Associates via Bay City News)
Eleanor Ramsey, president and CEO of Mason Tillman Associates, a consulting firm that shines the light on unfair practices in government contracting nationwide. (Pat Mazzera/Mason Tillman Associates via Bay City News)

By Keith Burbank, Bay City News

Eleanor Ramsey, president and CEO of the firm Mason Tillman Associates, has been creating change for Black people and other minorities long before she started consulting.

In an interview last Wednesday at her office in downtown Oakland, Ramsey said she first worked on easing racial conflict by serving on the student relations council in high school. The goal was to integrate the lunchroom in a school that consisted of 80% white students and 20% Black students.

Ramsey went on to get a doctorate in anthropology from the University of California at Berkeley and has been operating Mason Tillman Associates since starting it in 1978. Her firm’s name is a combination of Ramsey’s maiden name, Mason, and Tillman, a last name by which her husband was known.

Among many things, Mason Tillman Associates conducts disparity studies that show how equitably or inequitably governments distribute contracts to outside businesses.

“We have been able to improve the lives of many minority and woman business owners,” Ramsey said, adding that the work has been helping them secure contracts and improve profitability.

Mason Tillman Associates’ statistical research has revealed institutional practices systemically limiting minority businesses’ access to public contracts.

The company’s disparity study research and policy recommendations have helped identify and modify governments’ practices. Consequently, billions of dollars have been distributed more fairly in over 150 cities, counties, and states since 1978, she said. For example, New York State’s current minority business law is predicated on a Mason Tillman disparity study.

Oakland officials were at first reluctant to release a disparity study for their city, causing an outcry from the Black community. The study — kicked off by Ramsey’s firm — was eventually released in November 2020. Mason Tillman Associates plans to update it following a year of talks.

The company is also credited with preparing the nation’s first competitive disparity study, which was done for Maricopa County, Arizona, in 1990.

Disparity studies aren’t just the right thing to do, they’re the law. Following a 1989 U.S. Supreme Court ruling in the case of City of Richmond v. J.A. Croson, disparity studies must be prepared to document the need for awarding contracts to minorities. Lawmakers can no longer give preference to minorities without evidence from a study.

Ramsey suspects 300 to 400 studies have been conducted since the SCOTUS decision.

She has also been at the forefront of breaking through ceilings for businesswomen.

“The notion of the glass ceiling was very real,” she said, adding that for Black women, the ceiling was made of “concrete.”

Starting Mason Tillman Associates gave her an occupation when doors were closed for Black women following her attempt to become a university professor, she said.

“You walked a fine line,” said Ramsey.

Women could not come off as too intelligent without offending men. She refined the art of levity to make people feel comfortable.

Before Mason Tillman Associates, Ramsey worked as a flight attendant for the now-defunct yet iconic Pan American Airways. She was the second Black female flight attendant to be hired by Pan Am, which was the only international carrier in the U.S. in the 1960s. Pan Am was known for its stewardesses — now called flight attendants, another positive change for women in the workforce.

Ramsey managed to earn her doctorate in 1977 while raising six children. Then she applied for jobs as a professor and neither UC Berkeley nor the University of Colorado Boulder would hire her. Society wasn’t ready for a Black female professor, she said.

Her experience has taken her on some interesting journeys. While living in Boulder, she secured a contract with the National Park Service to investigate whether Wilberforce, Ohio, was once part of the underground railroad. That, she said, was the start of her consulting business.

Since starting Mason Tillman Associates 44 years ago, Ramsey has trained many professionals in the company’s Oakland headquarters. The firm continues to help redefine managers’ views of Black businesses in agencies nationwide.

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