“Social equity” has become a key buzzword among lawmakers, regulators and advocates working to create legal marijuana markets. These groups correctly recognize that the drug war was designed and executed in harmful and discriminatory ways but have failed to consider the discriminatory impacts of their own proposed solutions. Now, New York has garnered headlines as the latest state to fully incorporate social equity into its state licensing scheme.
The Empire State builds on previous iterations developed in Massachusetts and Illinois and runs alongside emerging social equity programs in Connecticut, New Jersey, Vermont and Virginia. All these programs have failed or are destined to fail at delivering restorative justice to victims of the drug war.
Most states reserve a subset of available licenses for qualified social equity applicants. In New York, a person must demonstrate they have owned and controlled a profitable for-profit business for at least two years. Therefore, only individuals who have already overcome the consequences of a drug conviction and experienced prior commercial success can acquire a social equity license.
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New York is the only state that has created this requirement. State leaders claim business experience is needed because they intend to distribute $200 million in subsidies to social equity licensees and want to ensure the money is used wisely. But regulators will deprive licensees of the ability to make key decisions about their businesses, such as where they can be located.
Instead, regulators will acquire commercial space and assign it to licensees at random. The assigned space may be far enough from the licensee’s residence to require relocation. Licensees would then be responsible for paying rent to state regulators for spaces they did not choose.
Meanwhile, hundreds of retailers have sprung up organically around New York in the two years since marijuana possession was legalized – all without the need for public subsidies or planning. Law enforcement has begun crackdowns on these retailers despite it being unclear whether they are even breaking the law.
Social equity programs should be redesigned from the ground up. States should stop erecting barriers to entry into the legal market and allow legacy marijuana suppliers to easily transition rather than executing massive arrests and asset seizures as New York is doing. Second, states should target restorative justice policies for the exclusive benefit of actual drug war victims. Our paper provides specific goalposts for these objectives.
It is not enough for policymakers to simply say they’re committed to social equity while enacting policies that lead to more arrests related to the sale of a nominally legal product. Social equity in New York is not equitable and is leading to a re-launch of the drug war.
Geoffrey Lawrence is director of drug policy and Michelle Minton is a senior policy fellow at Reason Foundation.
