To Kansas City businessman Dre Taylor, the case is clear for some form of affirmative action in Missouri’s new medical marijuana industry.
Marijuana-related arrests fell disproportionately on black and Latino users for decades, even though studies show white people use marijuana at about the same rate. Taylor said he’s seen firsthand the devastating effects of those marijuana arrests on black families and communities. Now that medical marijuana is going to be legal to use and sell, he figures the government should help ensure those same families and communities aren’t shut out of the economic windfall.
“I’m not asking to rewrite the wrongs,” Taylor said. “I’m just asking what can we do to promote equity in this industry that’s going to produce millions of dollars?”
Two Kansas City legislators have introduced bills that would give minority- and women-owned businesses a slight edge when applying for licenses to grow, manufacture and sell medical marijuana products.
But their proposals face an uphill climb, both politically and legally.
The constitutional amendment voters approved in November requires Missouri to issue at least 24 licenses to sell medical marijuana in each of the state’s eight congressional districts, for a total of 192.
The Missouri Department of Health and Senior Services is still writing regulations and probably won’t decide who gets licenses until the end of 2019. But the department has already accepted more than $2 million in application fees from more than 250 people hoping to start medical marijuana businesses, which suggests the competition will be stiff.
As Taylor said, there’s about to be a lot of money at stake. New Frontier Data, an independent analytics firm that specializes in the cannabis industry, estimated that Missouri will be doing $111 million in medical marijuana sales annually by 2025.
The nearly identical bills (House Bill 440 and Senate Bill 2), introduced by Rep. Barbara Washington and Sen. Shalonn “Kiki” Curls, give minority- and women-owned businesses a 10 percent bonus when the state scores license applications on a host of measurements like business plan, investment capital and security preparations.
But Washington and Curls are Democrats, and Republicans have large majorities in both chambers of the General Assembly, so the GOP sets the agenda.
National surveys have shown that Republicans are far more skeptical about race-based affirmative action programs in other areas, like college admissions.
Rep. Nick Schroer, an O’Fallon Republican who has introduced other medical marijuana legislation, said he wouldn’t rule out voting for anything before hearing from all sides. But the bills introduced by Washington and Curls didn’t sound like something he’d usually support.
“First and foremost I’m a true believer in the free market,” Schroer said. “I don’t think anybody should get a leg up one way or the other.”
Even if one of their bills navigates the partisan pitfalls to get passed, it would probably face legal challenges, like similar measures in Ohio and Maryland, said Vanderbilt University law professor Robert Mikos.
“It will get legal scrutiny and it’s likely to get blocked or thrown out, in part because if you want to use racial preferences even to give a leg up to historically disadvantaged groups you have to have a lot of evidence to support it,” Mikos said.
The Ohio bill, which mandated that the state award at least 15 percent of its medical marijuana business licenses to racial minorities, was declared unconstitutional by a state judge in November. A similar bill in Maryland was enforced only sporadically, because state officials there feared it, too, was unconstitutional. The legislature there altered it this year in response, instructing the state licensing commission to use other methods to increase minority licensees, such as community outreach.
Mikos said it’s not enough to show that the War on Drugs targeted the black community, as former Richard Nixon adviser John Erlichman admitted in 2016.
Courts generally want more direct evidence of discrimination in a specific industry before they allow the government to enforce race-based preferences, he said.
Given that Missouri’s medical marijuana industry is brand new, that’s a tough standard to meet. But Mikos said evidence of discrimination in similar industries, like agriculture, could be somewhat persuasive.
There is also evidence of racial discrimination from other states with established legal marijuana industries. A Seattle Times investigation in 2016 found that black and Latino businesspeople were underrepresented in Washington’s marijuana trade — and so were women.
That’s no surprise to Julita Latimer, a black woman who is interested in starting a medical marijuana business in Kansas City. Latimer, the treasurer of the Missouri Cannabis Industry Association, said that when she goes to marijuana-related business conferences in other states, the crowds are always mostly white and male.
She said she’s glad Washington and Curls introduced their bills and hopes they get hearings.
“I know there will be many people that will have a problem with it, but I think we have to understand that it is not really giving us a leg up as much as giving us an equal, level playing field,” Latimer said. “We all know that women make less than men that are doing the same jobs. That same disparity happens in all types of industries, and the cannabis industry is no different.”
Taylor said that if the legislature doesn’t act on the bills, the Missouri Department of Health and Senior Services could make similar allowances for minority- and women-owned businesses through rules and regulations. He said he’s also talking to Kansas City leaders about how to make sure the local black community isn’t shut out.
Under the amendment to the state constitution, cities are allowed to regulate when and where medical marijuana businesses operate.
Even if nothing gets passed, Taylor is well-positioned to get a license himself. As the founder of Nile Valley Aquaponics, he’s a successful businessman with expertise in growing crops efficiently.
But he said he’s less interested in making money himself than in helping other people in his community get into the legal marijuana trade.
“My thing is, I want more access,” Taylor said. “I have a mentoring program where I mentor young boys in single(-parent) households. Some of the fathers maybe have been in trouble with marijuana possession or have a record, and now they have an opportunity to right the wrongs and get involved in something now deemed as positive or legally accepted.”
Other marijuana-related bills introduced in Missouri this session:
▪ House Bill 292, by Washington, to expunge some marijuana-related convictions from Missourians’ criminal records.
▪ House Bill 157, by Rep. Brandon Ellington, a Kansas City Democrat, to legalize possession of small amounts of marijuana for everyone 21 and over.
▪ House Bill 238, by Schroer of O’Fallon, to prevent the state from sharing information with federal officials about who gets a medical marijuana card. This is meant to address fears that people who use medical marijuana, which is still illegal under federal law, will lose their ability to buy or own guns. Schroer said a previous legislature enacted similar protections for the information of people with concealed carry licenses. “The 10th Amendment (to the U.S. Constitution) allows us certain rights and responsibilities at the state level and I think that encompasses what we’re doing here with medical marijuana cards.”
▪ House Bill 341, by Rep. Ron Hicks, a Dardenne Prairie Republican, to expunge prior misdemeanor marijuana convictions specifically for those who qualify for medical marijuana cards under the state’s new program.
▪ House Bill 509, by Rep. Rob Vescovo, a Republican from Arnold, to require the director of the state’s new medical marijuana program be a licensed pharmacist. The current director is Lyndall Fraker, a former state representative and Walmart manager.
▪ Senate Bill 261, by Sen. Jamilah Nasheed, a Democrat from St. Louis, to allow people who legally use medical marijuana to continue receiving public assistance. Current state law allows for drug testing for some aid recipients, with loss of benefits for three years if they test positive.