A two-year head start for recreational cannabis shops owned by “economic empowerment” applicants is near expiration without a single store able to open, leaving city councillors considering an extension – this time with financial support for the business owners.
Councillors voted 8-1 on Monday to schedule an Ordinance Committee hearing before Aug. 15 to consider an extension. That’s urgent action for the council, taking into account that the two-year head start ends Sept. 23 and that even if the committee comes to an agreement and forwards a recommendation to the full council, there are no regular meetings to hear it until Sept. 6.
The Cannabis Business Permitting Ordinance approved by the council in September 2019 included a two-year block on corporate competitors opening recreational cannabis shops or adding recreational sales to existing medical marijuana dispensaries – a moratorium favoring “economic empowerment” applicants, who include Cambridge residents, minorities and those earning less than half of the area median income.
Then came a convoluted municipal process and a pandemic.
“A lot of businesses that were eligible under this preference period have been delayed … and primarily that’s of course due to Covid,” said councillor Quinton Zondervan, who wrote the order to consider a longer moratorium. “Without this extension, we’re not really able to fulfill our equity objective that led to this ordinance in the first place.”
Money as well as time
Ivelise Rivera, an economic empowerment applicant for a prospective East Cambridge cannabis store called Nuestra, told councillors that it was more complicated. While the pandemic has overlapped with the two-year moratorium, the “No. 1 barrier to entry into the cannabis market is money,” and some of her own business’ funders have dropped out over the past two years, she said.
“We all know how costly it is to secure a location in Cambridge. Without funding, we will leave social equity and economic empowerment applicants at a disadvantage,” she said, urging councillors to consider adding financial support to an extension.
Many EE license holders and applicants called for a community process so they could voice their needs rather than have the council just extend a moratorium that on its own might not help. Councillor E. Denise Simmons responded with an amendment to “provide an opportunity to hear from stakeholders” and look at finding paths to provide financial support. Councillors have been told that state law prevents the city from providing funds directly to businesses or residents.
“The biggest need for these applicants is not only time, but also funding,” Simmons said. “Most of the applicants do not have the wealth, they don’t have access to no-strings-attached startup funding, and money is what they need to pay their rent” and for other expenses.
Revolutionary Clinics’ role
In the meantime, Revolutionary Clinics – a small chain of medical marijuana dispensaries eager to also sell the drug for recreational purposes – said it was trying to help EE applicants meet their financial needs with $2 million from a fund run through its Aspire program, activating “upon the expiration of Cambridge’s moratorium on adult-use conversions.” EE license holders Rivera and Leah Samura, who is trying to open Yamba Boutique in Harvard Square, were to be the first recipients, getting $100,000 each that Rev Clinics said would be disbursed before August.
Another $2 million will go to minority-owned Cambridge businesses outside the cannabis industry.
Revolutionary Clinics filed a lawsuit in October 2019 against Cambridge saying the moratorium was illegal. The case was eventually dropped after rulings went against the company, and on Monday company chief executive Keith Cooper apologized for the suit and sought collaboration with EE license holders.
“We dropped the lawsuit many months ago when we realized those actions were not at all helping people move forward. It was a step in the right direction,” Cooper said during the council meeting’s public comment period. “At the time, I felt we were making a rational business decision to let the court weigh in on whether our rights were being taken away. I didn’t at all appreciate my role in amplifying divisions in the community, not understanding the long history of racial inequities and how people feel and experience that today. Frankly, I didn’t realize that until witnessing the reckoning of racial inequalities throughout the country and the world over the past two years.”
The apology comes “too late,” cannabis business applicant Taba Moses said in response, considering that the company brought the case all the way to an appeals court. “It takes a lot of money to get to that level,” Moses said.
Though Cooper said he was not at the meeting to “argue one side or the other,” others did speak against extending the moratorium. During public comment, owners of Central Square businesses the Miracle of Science Bar + Grill, Teddy’s Shoes and Lola’s said letting the moratorium end would help revive the square. Nicole Lyon, who runs the vintage shop Lola’s, spoke without mentioning that her storefront has been carved out of Revolutionary Clinics’ own space at 541 Massachusetts Ave. and is donated by the dispensary.
The council also voted 8-1 on Monday to amend a zoning petition to match state regulations on home cannabis delivery companies. The changes will allow delivery operators with their own warehouse as well as couriers who deliver from a retailer to complete an online sale.
This post was updated July 3, 2021, to identify Taba Moses as simply a cannabis business applicant.
This story was published in collaboration with the nonprofit small-business network Cambridge Local First.