Despite the long-standing national cannabis prohibition and the negative impacts of the War On Drugs, Colorado has achieved a significant milestone by legalizing recreational cannabis nearly a decade ago. Since the passage of Amendment 64 in 2012 by an 11% margin, the cannabis industry in the state has flourished, creating jobs for approximately 41,000 people at its peak and generating over $1.7 billion in total retail sales in 2022. In just the first four months of 2023, retail sales have surpassed half a billion dollars. Colorado, along with Washington State, has set an example of the economic benefits and tax revenue that result from repealing prohibitive laws on cannabis.
However, despite the growing number of jobs and the projected $36.7 billion of retail cannabis sales in 2023, marginalized communities in states where cannabis is legal continue to suffer from the social impacts of cannabis prohibition and the broader drug war. Many individuals are still incarcerated for cannabis-related offenses, and numerous regulations within the cannabis industry prevent individuals with prior felonies from gaining employment. The consequences and ongoing disadvantages caused by the drug war, which has cost the US trillions of dollars, persist.
Colorado’s Previous Social Equity Measures
To address the societal injustices resulting from the War On Drugs, states with legal cannabis have started implementing social equity programs within the industry. Social equity aims to include individuals from communities most affected by the past criminalization of cannabis in business ownership and participation in the cannabis industry. Historically, cannabis policies disproportionately targeted communities of color and other marginalized groups, leading to the underrepresentation of these same communities in the legal cannabis industry. It is clear that social equity policies are long overdue.
Colorado, despite being one of the first states to legalize recreational cannabis, did not enact any social equity-related policies until 2020 with the passage of House Bill 20-1424. In 2023, Governor Jared Polis announced an additional measure to provide startup loans through equity-based lender NuProject to social equity applicants in Colorado, ranging from $50,000 to $150,000. This signifies a significant step by the state in promoting social equity.
The Color of Cannabis Enhances Social Equity in Colorado
A recent historic moment for social equity in the Colorado cannabis industry occurred with the establishment of The Color of Cannabis, a Denver-based organization dedicated to advancing minority representation and social equity opportunities in the industry.
“The organization focuses on three pillars: criminal justice reform, policy reform, and education,” says Executive Director Sarah Woodson. “The lack of representation for minorities in decision-making processes is a major reason they were not prioritized in our state. The Color of Cannabis was established to address this issue. It was not an intentional oversight, but rather a lack of diverse voices at the table to represent the needs of people of color.”
The Color of Cannabis recently announced the acquisition of a 9,000-square-foot turn-key manufacturing facility solely for social equity businesses. The organization plans to divide the facility into six individual suites, providing dedicated space for social equity businesses and maximizing opportunities for these entrepreneurs.
“We are sharing the costs and guiding these businesses through the entire licensing process. It’s exciting because it has never been done in Colorado before,” Woodson explains. “I chose the name ‘The Color of Cannabis’ because our organization brings together people from diverse backgrounds – black, brown, and white individuals – all of whom have been negatively impacted by cannabis prohibition. They have lived in affected neighborhoods and have had family members incarcerated.”
The Color of Cannabis offers a comprehensive ten-week course covering various topics, ranging from the history of cannabis to the licensing process, regulations, and federal laws. Participants learn how to develop a business plan and practice pitching to potential investors.
The opening of the facility marks a significant milestone in social equity development within both Colorado and the national cannabis industry. Woodson and The Color of Cannabis also view this venture as an experiment to determine if small cannabis businesses can thrive with reduced overhead expenses.
“The industry in Colorado is becoming more diverse. When I first started attending cannabis organization meetings, there were no people of color. Then I saw 10, then 15, and then 20. While progress may be slow, it is certainly impactful,” Woodson emphasizes.