A cannabis industry trade group in Washington state on Monday proposed legislation to fund a social equity program that would help remove barriers to capital for minority business owners and would eliminate a residency requirement for potential investors in the market.
The Washington CannaBusiness Association (WACA) put forward the Cannabis Capital Equity Act, which would be supported by revenue generated by a fee of 1% on investments into marijuana businesses totaling over $500,000.
The fee would be in place until Dec. 31, 2025.
The legislation, which is waiting for Washington state lawmakers to reconvene in January, would also remove the residency requirement for investment into Washington state cannabis companies.
The act is WACA’s top legislative priority for the regulated industry in 2020.
“In order to grow a successful business, you have to have access to capital,” said Vicki Christophersen, executive director of WACA.
“The vast majority of cannabis companies in Washington are not turning a profit. Most of them are operating in the red.”
According to the WACA, the equity fund would be managed by the Washington state Department of Commerce.
The fund would offer low-interest loans to prospective and current license holders representing a diversity of race, color, national origin, religion, sex, age or disability.
“Five years since legalization, we continue to see persistent under-representation of people of color, women and others for whom the door of opportunity has not been open as wide,” Christophersen said.
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Bart Schaneman can be reached at [email protected]