Missouri holds outreach events in run up to cannabis microbusiness license lottery
In the fall, 48 people will be selected from a lottery of up to 8,000 applicants for the chance to get a cannabis license aimed at business owners from disadvantaged communities
Missouri’s cannabis industry is the new “gold rush,” said St. Louis couple Tiffany and Anwar Lee, and they’re considering buying a ticket for the lottery to get in.
Their ticket is a $1,500 application fee for a spot in a lottery making them eligible for a limited number of cannabis microbusiness licenses, and it’s refundable if they don’t get picked. The program is meant to boost opportunities in the industry for businesses in disadvantaged communities, and it was part of the constitutional amendment to legalize recreational marijuana that voters passed in November.
“In that industry, there’s going to always be room to make money, or at least to maintain a decent standard of living,” Anwar Lee said during an interview at an outreach event in St. Louis last week organized by state marijuana regulators.
The Lees were among those gathered at the event to hear from Abigail Vivas, Missouri’s new chief equity officer, who went through all the eligibility requirements for a microbusiness license. She held three other outreach events last week in Jefferson City, Lee’s Summit and Springfield.
But even if the Lees meet the eligibility requirements, their shot at winning is slim.
In August, six license winners will be picked by the Missouri Lottery in every one of the state’s eight Congressional districts in Missouri — for a total of 48 licenses.
Vivas, who oversees the microbusiness program through the cannabis regulating agency within the Department of Health and Human Services, estimates there could be up to 5,000 applicants statewide. But she’s heard other estimates that it could be 1,000 per congressional district.
As proponents of the marijuana legalization amendment were making their case to voters last year, the microbusiness program was the primary retort when opponents argued the law would cement an already distrusted, inequitable business licensing system in place in order to ensure the rich just get richer.
Supporters boasted that the microbusiness program will be the first of its kind in the nation and will help diversify the white-dominated industry.
However, Vivas said that goal wasn’t exactly spelled out in the constitution.
“Equity is not really mentioned in the microbusiness program, as far as the constitution is concerned,” Vivas said, “but I think that’s where we go back to the spirit of things.”
Adolphus Pruitt, president of the St. Louis City NAACP and one of the drafters of the microbusiness provision in the legalization amendment, said the word “equity” doesn’t need to be in the constitution’s definition of the microbusiness program.
“When you look at the categories and the qualifications, there’s no doubt that overwhelmingly the qualifications are geared up for people who were impacted by the unjust enforcement of marijuana laws,” Pruitt said. “No one would dispute that that population, in most cases, are African Americans.”
In his conversations with DHSS leaders and Vivas, Pruitt said state regulators are “clear” on that point as well.
The categories
There are seven categories where people can qualify for a microbusiness license, ranging from a lower income level or living in an area considered impoverished to having past arrests or incarcerations related to marijuana offenses.
Pruitt says most of the people he’s working with will apply under the category that says the applicant — their parent, guardian or spouse — has been arrested, prosecuted or convicted of a non-violent marijuana offense. That doesn’t include a conviction involving distributing of marijuana to a minor or driving under the influence of marijuana.
And the second category, he said, would be for the areas with high poverty and unemployment.
DHSS recently released ZIP codes for these two categories — areas where 30% percent or more of the population lives below the federal poverty level or where the rate of unemployment is 50% percent higher than the state average rate of unemployment.
However, applicants can also apply using the Census tracts where they live, and that’s what Pruitt is encouraging applicants to do. Vivas also encouraged people to look to the Missouri Census Data Center, which helped DHSS identify the eligible ZIP codes in these two categories, as a resource to finding their Census tract.
The category that remains a gray area involves ZIP codes where the incarceration rates for marijuana-offenses is 50% higher than the rate for the entire state.
Cecil King, communications director for the cannabis advocacy group Norml in St. Louis, said the intent of the microbusiness program was to “roll back the war on drugs.”
When DHSS included ZIP codes the agency considered having historic incarceration rates, they correlated to courthouses, not neighborhoods. Now there is a slim possibility that someone who lives in downtown Clayton — one of the most affluent suburbs in the St. Louis region where the average household income is $200,000 — could apply and win a microlicense.
“[The microbusiness program] was to help communities impacted,” King said, “not to spread out this data so that people in Clayton could get on.”
Pruitt says if that happens, then the NAACP would legally challenge that license because the addresses of courthouses don’t reflect actual residence, which is required under the constitution.
“Any court would say that the courthouse does not represent the muster of the amendment,” he said.
Coming from a law enforcement background, Vivas told the audience gathered in St. Louis last week that she knew this category was “going to be a problem” because of how criminal history is documented.
“The Department of Corrections doesn’t have the data, surprisingly,” she said. “The other thing is other than our department, no one else is required to work on this.”
The data ultimately came from the Missouri Highway Patrol, she said, and it took time for them to retrieve the data. Some of the ZIP codes for the courthouses in rural Missouri could include the entire towns’ populations, she said.
However in St. Louis, the three ZIP codes that correlate to courthouses include downtown St. Louis, which is among the least residential areas in the city, and downtown Clayton and St. Charles, where the population is 90% Caucasian, according to the Census.
“We are not closing the door on this,” Vivas said. “But this was the data we could get and felt was the best data at the time, and within the timeframe to be able to implement this as well.”
DHSS issued a variance for the category in the beginning of June, saying they will accept other forms of proof, including elected officials attesting to the historical incarceration rate.
Vivas said she knows the variance isn’t completely clear, but the department is committed to being “flexible as we can” in order to meet the spirit of the law.
“We’re doing our best to digest that and put something out there,” she said, “so kind of the variance is like, ‘What else is out there?’”
Missouri Independent is part of States Newsroom, a network of news bureaus supported by grants and a coalition of donors as a 501c(3) public charity. Missouri Independent maintains editorial independence. Contact Editor Jason Hancock for questions: info@missouriindependent.com. Follow Missouri Independent on Facebook and Twitter.
