Now that Rhode Island has legalized adult-use marijuana, plans call for the state to license 24 new retail shops in six zones around the state.
During the House debate in May, state Rep. David Morales (D-Providence) praised some of these details and the agreement, also in the law, to automatically expunge by mid-2024 some past marijuana charges.
“We’re taking a very thoughtful approach on this issue -- one that is prioritizing equity and focusing on the harm that cannabis prohibition has disproportionately done to affect lower income people and people of color across Rhode Island,” Morales said.
But some of his colleagues are more skeptical.
State Rep. Marcia Ranglin-Vassell (D-Providence) lives in the Wanskuck section of Rhode Island's capital city, where, she said, a lot of men have spent time at the ACI due to what she calls the ‘war on weed.’ Now, Ranglin-Vassell fears that those hurt by the drug war will get left behind.
“It has impacted my neighbors so harshly," she said, "and that’s why I really believe those people should get the first go at this and not rich white people mostly and corporations.”
The drug war has taken a heavy toll in Rhode Island.
A national report released in 2016 by the ACLU and Human Rights Watch found that Black Rhode Islanders were arrested for drug possession at almost three times the rate for whites -- a higher percentage than the national average.
But Ranglin-Vassell doubts the new law will be equitable for her constituents. She said many of them are too busy struggling to get by to follow the process for becoming part of the legit marijuana business.
“They’re hustling," Ranglin-Vassell said. "They don’t have time to look at every single thing that’s happening at the Statehouse.”
THE VIEW FROM THE STREET
A few miles north, in Central Falls, Jason Rocha seems like a good candidate to be part of Rhode Island’s effort to address social equity in marijuana. He’s a cannabis enthusiast.
“I enjoy marijuana," Rocha said. "I believe in marijuana, marijuana has helped my life tremendously.”
At the same time, Rocha said, his marijuana use has been held against him throughout his life, including when he wanted to join the military and ran into trouble with the law as a young man.
“Well, everything always leads to marijuana," he said. "So at that time if you’re riding around in your car, cop smells marijuana, that was probable cause for stop, search and seizure, just for the smell of marijuana.”
Rocha spent time in prison years ago on a cocaine charge. He later co-founded an advocacy group called the Formerly Incarcerated Union of Rhode Island.
He’s 42 now and runs a property management company based in a handsome brick building across from Central Falls City Hall. With Rhode Island becoming the 19th state to legalize marijuana, Rocha said he could grow a better product and sell it at a lower price than competitors.
“I’m a grower," he said. "This is my hobby. This is recreation for me. This is what I enjoy doing.”
But Rocha sad he’s not planning to seek a retail license, for lots of reasons.
He’s frustrated that awarding licenses will take up to two years, and Rocha is concerned that the marijuana market could change dramatically over that time. If marijuana use is now legal, Rocha believes, he should be able to set up shop.
He also said it’s hard to get information about the process and believes the deck is stacked against him, in part since if he had a retail shop, he’d be required to buy marijuana from existing cultivators.
“To be honest with you, I quit," Rocha said. "I’m just fed up, I’m disgusted, I’m disappointed.”
THE COST FACTOR
There’s no question the process of getting a retail license to sell cannabis will be difficult and expensive. The annual cost of a license will be $30,000.
And setting up a brick-and-mortar marijuana shop could cost a few million dollars. Cannabis will be taxed at a rate of 20 percent.
Marijuana remains illegal federally, so conventional bank loans are not available, and business expenses can not be deducted for taxes. These factors suggest that rich people still have a big advantage in profiting from legalization.
The state’s top cannabis regulator, Matt Santacroce is optimistic that the state’s legalization approach will be a tax revenue-generator. But he said that Rep. Ranglin-Vassell is on target in asking whether those hurt by the drug war will be left behind as others cash in.
“I think by and large, she’s right," Santacroce said. "I think that this is a very difficult, very heavily regulated industry, in this state and in every state, And with that comes costs to participate, to participate compliantly.”
The state’s legalization law requires social equity applicants to own at least 51 percent of a new cannabis business. That creates an opening for investors to enter the new sector with a 49 percent stake -- or just less than half of the ownership -- in an individual enterprise.
And there are still questions about how the effort to boost social equity will work in Rhode Island. That’s because the Cannabis Control Commission, which will create regulations and decide who gets 24 new retail cannabis licenses, won’t take shape until after Gov. Dan McKee makes three appointments in the near future.
House sponsor of the cannabis bill, Rep. Scott Slater (D-Providence), says an advisory board included in the new law will advocate for social equity applicants and recommend changes if needed. And he says legalization will keep marijuana spending from migrating to Massachusetts while offering a product free from impurities.
“This is a safe and healthy way to go," Slater said, "to have adult recreational cannabis that is tested, safe and accessible and people who want to use it as recreational.”
As new pot shops get established about the state, annual net state revenue is expected to grow to about $7 million by fiscal 2025.
While some, including Rep. Ranglin-Vassell, say that revenue should go to the communities hardest hit by the drug war, state lawmakers will retain discretion over how the money gets spent.
Ian Donnis can be reached at idonnis@ripr.org. You can follow him on Twitter @IqnDon and sign up for email delivery of his weekly RI politics newsletter.
