§ 21-28.11-31. Social equity assistance program and fund.
(a)(1) Findings. The general assembly finds that additional efforts are needed to reduce barriers to ownership and/or participation in the cannabis industry for individuals and communities most adversely impacted by the enforcement of cannabis-related laws.
(2) In the interest of establishing a legal cannabis industry that is equitable and accessible to those most adversely impacted by the enforcement of cannabis-related laws, the general assembly finds and declares that a social equity program should be established.
(3) The general assembly also finds and declares that individuals who have been arrested or incarcerated due to cannabis related laws suffer long-lasting negative consequences, including impacts to employment, business ownership, housing, health, and long-term financial well-being.
(4) The general assembly also finds and declares that family members, especially children, and communities of those who have been arrested or incarcerated due to cannabis related laws, suffer from emotional, psychological, and financial harms as a result of such arrests or incarcerations.
(5) Furthermore, the general assembly finds and declares that certain communities have disproportionately suffered the harms of enforcement of cannabis-related laws. Those communities face greater difficulties accessing capital to finance the start-up costs for cannabis establishments.
(6) The general assembly also finds that individuals who have resided in areas of high poverty suffer negative consequences, including barriers to entry in employment, business ownership, housing, health, and long-term financial well-being.
(7) The general assembly also finds and declares that promotion of business ownership by individuals who have resided in areas of high poverty and high enforcement of cannabis-related laws furthers a more equitable cannabis industry.
(8) Therefore, in the interest of mitigating the harms resulting from the enforcement of cannabis-related laws, the general assembly finds and declares that a social equity program should offer, among other things, business assistance and license application benefits to individuals most directly and adversely impacted by the enforcement of cannabis-related laws who are interested in establishing or participating in a cannabis business entity.
(b) There is created in the state treasury within the general fund, a fund which shall be held separate and apart from all other state monies, to be known as the social equity assistance fund. The social equity assistance fund, subject to appropriation, shall be exclusively used for the following purposes:
(1) To provide grants to approved social equity applicants to pay for ordinary and necessary expenses to establish and/or operate a cannabis establishment, and to also further promote the goals of this chapter, including without limitation, job training and workforce development, mentoring services and technical assistance;
(2) To support the waiver or reduction of application and licensing fees pursuant to this section for social equity applicants; and
(3) To implement and administer programming for restorative justice, jail diversion, drug rehabilitation and education workforce development for jobs related to cannabis cultivation, transportation, distribution and sales.
(c) The social equity assistance fund shall be subject to appropriation. The fund shall consist of all monies received on account of the state as a result of application for, and licensing of, individuals and entities pursuant to the provisions of this chapter, exclusive of licensing fees paid pursuant to the provisions of chapter 28.6 of this title. Additionally, except as otherwise provided, the fund shall consist of all administrative penalties received for violations of this chapter, except tax violations and interest earned on balances in the fund.
(d) The commission shall administer the social equity assistance fund and the authorized disbursement of funds, as appropriated by the general assembly. In consultation with the cannabis advisory board, the commission shall promulgate rules and regulations establishing the criteria, eligibility, qualifications and process for administering the disbursement of funds from the social equity assistance fund.
(e) Reporting. Beginning September 1, 2023, and each year thereafter, the commission shall annually report to the governor and the general assembly on the outcomes and effectiveness of this section that shall include, but not be limited to, the following:
(1) The number of persons or businesses receiving assistance under this section;
(2) The amount in financial assistance awarded in the aggregate, in addition to the amount of grants awarded; and
(3) If applicable, the number of new jobs and other forms of economic impact created as a result of assistance from the social equity assistance fund.
(f) Fee waivers.
(1) For social equity applicants as defined in § 21-28.11-3, the commission may waive up to one hundred percent (100%) of any nonrefundable license application fees or any nonrefundable fees associated with acquiring a license to operate a cannabis establishment, pursuant to rules and regulations promulgated by the commission in consultation with the cannabis advisory board.
(2) If the commission determines that an applicant who applied as a social equity applicant is not eligible for social equity status, the applicant shall be provided an additional ten (10) days to provide alternative evidence that the applicant qualifies as a social equity applicant. Alternatively, the applicant may pay all required fees and be considered as a non-social equity applicant. If the applicant cannot do either, then any application fee shall be returned and the application process shall be terminated.
(g) Transfers of cannabis establishment licenses awarded to a social equity applicant are subject to all other provisions of this chapter, and applicable law; provided however, that a license issued to a social equity applicant shall only be transferred to another qualified social equity applicant as determined and approved by the commission.
(h) Reporting.
(1) By September 1, 2023, and on the first day of September of every year thereafter, or upon request by the commission, each cannabis establishment licensed under this chapter and § 21-28.6-12 (“The Edward O. Hawkins and Thomas C. Slater Medical Marijuana Act”) shall report to the commission, on a form to be provided by the commission, information that will allow it to assess the extent of diversity in the medical and adult use cannabis industry and methods for further reducing or eliminating any identified barriers to entry, including without limitation, access to capital.
(2) Failure of a cannabis establishment to respond to the request of the commission to complete the form, report, and any other request for information may be grounds for disciplinary action by the commission pursuant to this chapter. The information to be collected shall identify, without limitation, the following:
(i) The number and percentage of licenses provided to social equity applicants;
(ii) The total number and percentage of employees in the cannabis industry who meet the criteria in the definition of social equity applicant; and
(iii) Recommendations on reducing or eliminating any identified barriers to entry, including access to capital, in the cannabis industry.
History of Section.
P.L. 2022, ch. 31, § 1, effective May 25, 2022; P.L. 2022, ch. 32, § 1, effective
May 25, 2022.