POT OF GOLD
Newly legal weed could help N.Y.’s COVID-struck economy
Advocates applauding the legalization of marijuana in New York last week say it’s the biggest thing since the end of prohibition, and 100 times more profitable.
And the timing, they say, could not be better for an economy ravaged by the job-killing coronavirus that not only shut down businesses, but crippled entire industries.
And whether you smoke it, bake it, brew it or dab it, the prospects for pot use are endless. So, too, are the economic opportunities.
Someone has to grow it. Someone has to harvest it. Someone has to package it. And, someone has to distribute it. There is money to be made — and jobs to be created — around marketing, regulation, delivery and research, with offshoots that have no direct connection to the product at all.
That’s good news for job seekers and entrepreneurs who still have moral convictions about enhancing their lives with so-called “drug money.” Until advocates can clear the smoke around the stigma associated with marijuana, advocates are promoting the possibilities.
“People just think about smoking,” said DeVaughn Ward, senior legislative counsel for the Marijuana Policy Project, a cannabis legalization advocacy group. “It’s so far beyond that. There are so many opportunities in this industry.”
How bright is New York’s cannabis future? Just ask the religious institutions promoting the possibilities.
More than a year before the legislation was passed in New York, Brooklyn’s Emmanuel Baptist Church became one of the first congregations in the nation to host a cannabis conference. The first conference in February of 2019 attracted about 500 people. A follow-up several months later drew more than 2,000.
Workshops included “Acquiring Cultivation or Dispensary Licenses,” “Ancillary Businesses,” “Careers in Cannabis” and “Hemp and Social Justice & Policy Reform.”
“There’s definitely an acute interest,” said the church’s pastor, the Rev. Anthony Trufant. “This is far more than a mere matter than being permitted to smoke cannabis or ingest it,. This is much more of an economic issue. People see an opportunity to purchase stock” Trufant said he wants to be sure African-Americans and people of color don’t miss the opportunity to get in on the ground floor.
“There are trains that have left the platform before,” Trufant said. “And people of color have been standing on the platform. People of color have an interest in purchasing a ticket, purchasing stock in the train and owning the train.”
Gia Morón, who organized the Emmanuel Baptist Church conferences, said she is excited about the social equity component written into the new legislation.
New York became the 15th state to fully legalize recreational marijuana Wednesday when Gov. Cuomo signed legislation allowing people to possess up to three ounces of pot and grow a limited amount of cannabis at home.
Lawmakers recognized the toll the war on drugs and harsh marijuana sentences took on communities of color, including jail time for offenses that are no longer illegal. To help make amends, the bill includes social equity provisions to siphon off 40% of tax revenues from legal weed sales into communities negatively impacted by overpolicing and to offer cannabis business opportunities to traditionally underrepresented groups.
“When we’re looking at it from the business side it’s unfortunate that many Black people have been limited by their access to the industry because it requires large capital for a point of entry,” said Morón, executive vice president of Women Grow, which advocates for women in the cannabis industry.
“This money can be used for schools, education, drug treatment. We haven’t seen that from any other industry. That’s critical.”
Analysts say that a legal marijuana market will create tens of thousands of jobs in New York and provide opportunities for companies that provide equipment and services to the industry.
According to Marijuana Business Daily, a cannabis industry financial resource, an adult-use market in New York would generate $2.3 billion in annual sales by its fourth full year.
Under the law, legal sales won’t begin until April 1, 2022, and it could take 18 months to two years to establish regulations.
But not everybody is riding high. Money — lots of it — was already being made in New York from the cannabis industry. But much of it was illegal.
The illegal market isn’t going away overnight, industry analysts said, not when there are customers unwilling to pay taxes on a product they used to get tax free. But legalization will put plenty of pot dealers out of business unless they can cash in on the action.
“A lot of people in the legal market were people who were honest about their background past, applied for licenses and successfully transitioned,” said Chris Vaughn, CEO of Emjay, a cannabis retail and delivery company.
Vaughn said the business model for cannabis distribution is a lot different than it was for alcohol starting out. Brick and mortar distribution stores aren’t likely to thrive in a delivery-driven business.
“How do people shop today?” Vaughn said. “Online via delivery. People like convenience.”
But don’t close the door on buildings, and the impact cannabis can have on the real estate market, Ward said. Smoking — of any kind — is still prohibited in a lot of places in New York, even some residential apartments.
Look for cannabis lounges to sprout up like neighborhood watering holes, Ward said, with happy hours and two-for-one specials.
“You can look at the alcohol industry and see where this industry is going to go,” Ward said. “People were able to create some real generational wealth off that industry. We’re just scratching the surface.”