Equity elusive in NM's budding cannabis industry - Albuquerque Journal

Equity elusive in NM’s budding cannabis industry

Cathryn Cunningham/Journal

There tend to be fewer business owners that are female and that come from a minority background here and across the country.

Cannabis as an industry isn’t much different.

According to the National Hispanic Cannabis Council, which tracks data on license holders across the country to reveal equity issues in the industry, just 5.7% of licensed cannabis businesses are owned by Hispanics.

Women-owned cannabis businesses make up 20% of the industry, according to a report from MJBizDaily.

New Mexico’s number of women- and minority-owned businesses tend to follow a similar trend just a few months into the start of adult-use cannabis sales.

“I’m deeply sad because we haven’t made a lot of movement in terms of equity in this cannabis industry,” said Ben Lewinger, the executive director of the New Mexico Cannabis Chamber of Commerce. “I’m sad that we have not started to move the needle, and realize the promise that this industry in New Mexico is for everybody. At the same time, I also see opportunity.”

Crunching the numbers

Numbers on race, ethnicity and gender presented to the Cannabis Regulatory Advisory Committee in July showed the local cannabis industry’s license holders are primarily made up of those who identified as white, a majority of whom also claim no Hispanic or Latino makeup. Women were also largely outnumbered by men.

Of the nearly 2,000 controlling license holders in the state, about 1,163 identify as having no Latino or Hispanic background and primarily claimed white for race.

Minority license holders — including those who identify as Black, Asian American, Native American, mixed race or other races — account for just 33% of the industry. Comparatively speaking white license holders totaled 1,285, according to the New Mexico Regulation and Licensing Department.

The numbers don’t stop there. When looking at gender, men account for 1,336 of total license holders compared to just 547 women. Thirteen identified as non-binary and six identified as gender non-conforming, with 19 preferring not to answer.

Moving toward equity

Changing any industry to get leadership to match the racial and gender makeup of its geographic area is always a heavy lift, especially in states that tend to have minority-majority populations such as New Mexico.

White people, and particularly white men, tend to have greater access to capital than any other type of business owner or executive, Lewinger said. And that’s true here in New Mexico.

But change needs to be made on that end, he said, by giving more minority owners access to funding they may not have had previously.

That isn’t particularly easy in the cannabis industry, however.

Considering cannabis’ federally illegal status, many lenders shy away from giving business owners access to the money they need to keep their businesses in good standing — and thriving. In this industry, Lewinger said, most capital to get a business started or to help it expand comes from private lenders.

The cannabis chamber, in fact, is working on an accelerator program focused on getting legacy operators connected with new or prospective business owners — a mentor/mentee relationship, if you will — that will help provide them guidance, Lewinger said.

“I hope that this is something that we can really lean into, working with the state and working with some of our legacy producers or some of the new licensees who have been able to move more quickly in opening their businesses,” he said.

The chamber is working on a test run on that program with the Verdes Foundation.

Rachael Speegle, the company’s CEO, is helping lead the charge and said the idea came from collaborative communication with the Cannabis Control Division and with the Drug Policy Alliance to see where the challenges are in creating social equity in the industry.

She said Verdes is working with at least one potential licensee by giving them full access to everything, from Verdes’ books and vendors, to insurance and legal representation — basically helping them “get a leg up faster,” she said.

“We’re … showing them how we do this incrementally,” Speegle said.

The state has been working towards creating a more equitable space for business owners in the cannabis industry. The Cannabis Control Division has been holding monthly workshops called InvestiNM that provides information to train potential entrepreneurs in the state, said Regulation and Licensing Department Superintendent Linda Trujillo.

CCD, an arm of the department Trujillo helms, has also partnered with Picuris and Pojoaque pueblos in an intergovernmental agreement aimed at giving them say over regulating cannabis operations on their lands, as well as opening up the opportunity for tribal members to apply for state licenses for any business they’d conduct outside of tribal lands.

The state has also opened up a loan program through the New Mexico Finance Authority aimed at lending microbusinesses up to $250,000 with low interest rates.

But to get the state’s newest industry to a place “that reflects the face of all New Mexicans,” all sides — industry and state leaders — need to come together, Lewinger said.

“We are committed to continuing to build a socially responsible cannabis industry and eliminating barriers for women, people of color and other marginalized groups to benefit from this new industry,” Trujillo said.

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