Legal cannabis thrives in suburban Detroit — but the city is neglected

DETROIT – When Michigan legalized recreational marijuana, Detroit leaders set out to ensure that the city’s residents shared the profits.

They have passed one of the nation’s most ambitious”social equality“The laws, intended to help the black and Hispanic communities that have paid the highest price in the war on drugs, are involved in the lucrative industry.

But more than two years after Michigan’s legalization, even as marijuana entrepreneurs thrive in suburban Detroit, the city itself has become a cannabis dead zone. It was the first recreational marijuana law prevented Last year by a federal judge on a provision that revoked Detroit’s long-running licenses. A second law, enacted last month, was amended this week else A lawsuit, putting her future into question.

The resulting delay means potential Detroit entrepreneurs — the people the city set out to help — are left watching and waiting while their suburban rivals gain an advantage.

Among those affected are black licensed medical dispensary owners who have been waiting for years to expand into recreational marijuana. Many lack the resources to confront the ongoing legal turmoil, said Kimberly Scott, who grew up in Detroit and leads the 10-member Detroit Licensed Business Owners Association.

“The majority of current owners are struggling to stay afloat,” Scott said.

Last year, Chronic City opened a medical dispensary on Detroit’s east side, licensed to sell cannabis to people with documented medical conditions. It struggled to compete with out-of-town recreational dispensaries that could sell it to anyone over the age of 21. The store closed after six months and is now sitting empty and dark, waiting until recreational sales are legal in Detroit.

Chronic City opened in Detroit for six months last year.
Chronic City opened in Detroit for six months last year.Cydni Eledge for NBC News

“It affects everyone,” Scott said. “And for those of us who are social justice who have lived in Detroit our whole lives and have been affected by the war on drugs, it certainly affects us.”

The problems in Detroit reflect the difficulty lawmakers across the country have faced as they try to level the playing field in an industry long dominated by white men.

While 15 of the 36 states legal for cannabis have social equality programs, several cities, including Los Angeles and Oakland, California, have tried. the support Domestic entrepreneurs, many of these efforts He failed to achieve his goal Which experts and advocates say is required. Hispanic and black business owners may need additional support in making connections and securing funding to compete in an industry that is illegal under federal law and does not qualify for traditional loans.

Some efforts, such as those of Detroit, aimed at helping a specific group of entrepreneurs have been subject to lawsuits and challenges.

Others aren’t enough to confront generations of apartheid and injustice, said John Hodak, a senior fellow at the Brookings Institution who studies federal and state marijuana policy.

“Handing over the Social Equity License does not remove all racism,” Hoddick said. “It gives someone a license and puts them on the cusp of American commerce, which is riddled with racism, discrimination and prejudice.”

‘Uneven playing field’

Detroit City Council President Pro Tim James Tate said he knew Detroit would need a strong marijuana social justice law in 2014 when he led an effort in the city to regulate medical dispensaries that had proliferated.

At the time, he said, he was focused on changing the fact that medical dispensaries exist in a legal gray area — people could be licensed as “caregivers” to supply marijuana to a limited number of patients with medical conditions that was officially permitted by the city or state. Tate noted that of the approximately 240 paralegal dispensaries counted at the time, only a few were owned by Detroitz.

“That was a concern,” he said. “Many foundations were making good money,” but the proceeds weren’t there in the community.

Scott said the opaque situation of medical dispensaries has worried many Detroit entrepreneurs. Most of the city’s residents are black, and given the long history of over-security in black neighborhoods, some fear the consequences of opening an illegal business.

Scott, 41, a former history teacher and nurse who is registered as a caregiver for cannabis, considered opening a dispensary in 2015, but is concerned about the legal risks. She was also concerned about her safety selling marijuana alone, so she decided to use her rented space on the west side of town to grow cannabis rather than selling it directly to consumers. She used nearly $20,000 of her savings to buy seeds, lights and other equipment—a project that failed when the building’s faulty heating and cooling system and rusty water destroyed the crop.

The second time Scott tried to open a business, in 2017, dispensaries were more legitimate, but new rules from the city and state complicated their efforts.

Kimberly Scott.
Kimberly Scott has been working for years to break into the legal marijuana industry.Cydni Eledge for NBC News

Citywide, strict new zoning laws that prevented dispensaries within 1,000 feet of schools, churches and liquor stores made it difficult for it to find a building because investors with deep pockets quickly bought the best real estate in Detroit’s “green zone.”

At the state level, applicants seeking a “supply center” license need to submit lengthy site plans and financial projections. They needed clean criminal records and proof that they had enough money to succeed – hurdles that left many on the sidelines.

“The community created an uneven playing field even before any kind of legalization occurred,” said Andrew Prespo, executive director of the state’s Cannabis Regulatory Agency, which has helped streamline the application process to make it less difficult. “And then, with its legalization and commercialization, it has made it more in the interest of disadvantaged communities.”

All of these factors help explain why there are 75 licensed medical dispensaries in Detroit today, only 10 of which have black owners — in a city where 4 out of 5 residents are black, Scott said.

Across Michigan, where 14 percent of the population is black, a recent state survey found that roughly 3 percent From the cannabis business to black owners.

“Correct mistakes”

When Michigan legalized recreational marijuana after the 2018 referendum, Tate was determined to address the industry’s black underrepresentation in Detroit. But the state’s Basic Law has given an advantage to existing dispensaries, requiring companies to have a two-year medical license before they can obtain an entertainment license.

“It wasn’t fair,” Tate said.

He urged the city to ban recreational licenses until 2020, as the state prepares to repeal that requirement. Next, he set out to ensure that the townspeople had access to industry. In late 2020, he suggested “Detroiter Heritage‘, which reserved 50 percent of retail licenses for people who have lived in the city for at least 15 of the past 30 years. Detroiters with low incomes or marijuana convictions in their family can qualify with fewer years of residency.

Morris Morton, the black owner of a medical dispensary called Motor City Kush, said the new law – which the city council unanimously enacted – was “strong”.

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