The California Governor’s Office of Business and Economic Development (GO-Biz) announced a new batch of cannabis tax revenue community investments on May 31. This round’s grants for fiscal year 2023-2024, which was given to recipients from the California Community Reinvestment Grants program (CalCRG), includes 30 organizations and a total of $46.6 million.

In order to be chosen to receive funds through the CalCRG program, applicants must meet a variety of criteria. Organization must be organized and in good standing six months before being chosen, must maintain their tax-exempt status with the IRS and California Franchise Tax Board, must be an active registered organization through the California Secretary of State’s Office, and have a physical address in California, among other requirements.

The most recent round of applicants includes two organizations located in Alameda County, two in Contra Costa county, two in Fresno County, one in Humboldt County, nine in Los Angeles County, two in Sacramento County, one in San Diego County, three in the city and county of San Francisco, and two in Santa Cruz County. Additionally, six applicants hold established residence in more than one county.

Among the recipients with the highest amount of funds granted, four received $3 million, including Poverello House in Fresno County, Downtown Women’s Health Center in Los  Angeles County, and Get Lit-Words Ignite, Inc. in Los Angeles County, and PRC in City/County of San Francisco. The lowest granted amount included was Monument Impact in Contra Costa County, which received $600,000.

The program first began accepting applications from organizations in 2018. In April 2020 for FY 2019-2020, GO-Biz awarded $30 million in cannabis tax revenue toward 54 organizations. The following year, FY 2020-2021 awarded 59 organizations which received a portion of $15 million. For FY 2021-2022, 78 organizations received a split amount of $35.5 million. Last year for FY 2022-2023, GO-Biz awarded $50 million to 31 organizations. And then of course, the most recent round for FY 2023-2024 saw $46.6 million given to 30 organizations.

In reviewing the past few years of grant results, the amount of cannabis tax revenue funds has generally increased (the highest being funds granted in FY 2022-2023), although the number of organizations chosen has decreased.

This upcoming August, GO-Biz also confirmed that it would reopen its window for applicants to apply for funds once again, which will be reviewed and likely awarded sometime in spring 2025.

In a recent breakdown of cannabis tax revenue in each U.S. state, Marijuana Policy Project shows that California generated a total of $5.7 billion since legalization began in 2018 through 2023. In the beginning, the state collected $397 million, followed by $638 million in 2019, $1.11 billion in 2020, $1.4 billion in 2021, $1.1 billion in 2022, and $1.1 billion in 2023. This is based on a tax rate of 15% excise tax and standard 7.25% sales tax.

California collected the most cannabis tax revenue, followed by Illinois which generated $1.9 billion between 2020- partial 2024 data. Between 2014-2023, Washington state has collected $4.1 billion in cannabis tax revenue, and between December 2019-partial 2024 data, Michigan has collected $1.2 billion.

The GO-Biz annual cannabis tax revenue grant isn’t the only state effort to allow cannabis tax revenue to go back into the community. It also recently awarded $12 million to “to advance economic justice for populations and communities impacted by cannabis prohibition and the War on Drugs by providing support to local jurisdictions as they promote equity in California and eliminate barriers to enter the newly regulated cannabis industry for equity program applicants and licensees,” the grant description stated.

The funds were split among 10 cities and/or counties for FY 2023-2024. This included the city of Oakland ($3 million), city/county of San Francisco ($2 million), Trinity County ($1.8 million), Mendocino County ($1.8 million), city of Sacramento ($1.2 million), city of San Jose ($1 million), Humboldt County ($600,000), city of Coachella ($350,000), city of Daly City ($75,000), and city of Santa Monica ($40,000).

In March, the San Jose City Council published a press release stating that the funds would help the city develop its local cannabis industry. “We are thrilled to support the City of San José’s efforts to reduce barriers to entry into the legal, regulated cannabis industry,” said GO-Biz Deputy Director of Community and Local Equity Grants, Will Koch. “We look forward to this grant providing the technical assistance and funding to support equity in licensing and cannabis business registrations.”

Director of the Office of Economic Development and Cultural Affairs, Nanci Klein, explained the necessity of the program. “San José’s Office of Economic Development and Cultural Affairs is committed to driving a competitive economy that increases the prosperity and quality of life for all our residents and business owners,” Klein said. “The Cannabis Equity Business Academy seeks to equalize the playing field in this complex and heavily regulated business sector, and I am glad to say that of the 29 San José residents participating in the Academy, 86% of them identify as Asian, African and Native American, Latino or Pacific Islander.”

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When Arizona voters approved adult-use cannabis initiative Prop 207 in 2020, it created a program called Justice Reinvestment Program, which directs the Arizona Department of Health Services (ADHS) cannabis tax funds to go toward a variety of public services.

The Justice Reinvestment Program includes funding for 1.) public and behavioral health services (such as substance abuse prevention/treatment), 2.) “Restorative justice, jail diversion, workforce development, industry-specific technical assistance or mentoring services” (to benefit those who are in areas that are disproportionately affected by high arrest rates), 3.) “addressing the underlying causes of crime” and targeting reduction in prison population and drug-related arrests, and 4.) funding the creation of tech or programs with a focus on “restoration of civil rights” and expunging records.

On Dec. 21, the ADHS announced that it has finally chosen the recipients of the first round of Justice Reinvestment Grants. This includes 18 nonprofit recipients which …”address all of the key focus areas outlined in the statute and in the community listening sessions and represent communities from across the state of Arizona,” ADHS wrote.

Northland Family Help Center, Hushabye Nursery, Axiom Community of Recovery, Cihuapactli Collective, Stuck Community Acupuncture, Inc, Phoenix Indian Center, Arouet Foundation, Friendly House, Jobs for Arizona’s Graduates (JAG), Persevere, Constructing Circles of Peace, Regional Center for Border Health, Inc. – Yuma, Regional Center for Border Health, Inc. – Parker, Arizona Democracy Resource Center, Southern Arizona Legal Aid, Inc, The Bambi Fund, Just Communities Arizona, and Our Sister Our Brother.

According to a press release, ADHS began working on this initiative by analyzing state data and determining which communities were impacted the most by the War on Drugs, specifically in relation to “drug enforcement, arrest, and incarceration.” During this time, 18 listening sessions were heard, and participants came up with a list of eight points of benefit for their communities: neighborhood safety/community gathering places such as parks or community centers, cultural awareness training, affordable housing, stigma reduction, offering tech classes for people who were once incarcerated, youth development services, and substance abuse education/prevention.

“Moving forward, the Office of Health Equity will develop a robust program evaluation process to ensure that funded projects serve the intended communities and create a positive impact,” ADHS continued. “The program evaluation will assess if awardees meet their determined goals and the data collected will be used in efforts to continuously improve the program. The Office will also facilitate a Community of Practice for all awardees and interested stakeholders to share best practices, lessons learned and build partnerships to support the communities served.”

State law says that the Justice Reinvestment Program will receive 35% from the Justice Reinvestment Fund, which includes 10% of cannabis sales tax revenue. Additionally, one-third of cannabis tax revenue goes to community colleges and districts, 31% to public safety (law enforcement, fire departments, etc.), and 25% for the Arizona Highway Revenue Fund.

When Prop 207 passed in 2020, it was widely celebrated by the cannabis community. NORML Executive Director Erik Altieri shared a statement about how it will benefit people in Arizona. “Until now, Arizona had imposed some of the strictest prohibition laws in the country; in some instances, the possession of even small amounts of marijuana was classified as a felony,” Altieri said. “By rejecting this failed policy, no Arizonan going forward will be saddled with a criminal conviction for engaging in the personal possession or cultivation of cannabis, or face the lifelong stigma that comes with it.”

Recently, Arizona met a milestone sales achievement. As of December 2023, the state has officially collected more than $1 billion in cannabis sales (with data collected between January 2023-September 2023). This includes a split of adult-use cannabis sales ($797 million) and medical cannabis sales ($267 million) for the same nine-month time period. Since January 2021 when sales first began, the state has collected more than $4 billion in combined recreational and medical sales.

Other states have also implemented similar programs to help fund various community services. The California Department of Cannabis Control (DCC) announced in February that it would be granting $20 million to bring cannabis retail stores to underserved areas through a Local Jurisdiction Retail Access Grant.

Later in June, the DCC awarded $4.1 million as part of the first phase of the grant process. “The Local Jurisdictional Retail Access Grant program will help provide access to regulated cannabis retail for over 2 million Californians that currently live in an area where access to licensed cannabis retail businesses is insufficient,” said DCC Acting Director Rasha Salama. “In addition to improving access to existing customers, these grants are another important step towards establishing legal pathways for legacy and social equity operators.”

Applications for Phase II of the Local Jurisdiction Retail Access Grant opened in October 2023, where $15 million is available in total funding. An announcement date has not yet been established.

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New York Governor Kathy Hochul last week announced that the state’s cannabis social equity fund has secured a $150 million investment to support entrepreneurs licensed to open recreational marijuana retail shops. Under the terms of the deal, Chicago Atlantic Admin, LLC will invest up to $150 million in secured capital to provide loans to business owners negatively impacted by years of cannabis prohibition.

“New York has always strived to lead the nation in providing opportunities for those who have been unjustly denied privileges and opportunities,” Hochul said in a statement from the governor’s office. “Today’s announcement reinforces New York’s commitment to building partnerships that benefit New Yorkers and setting right the wrongs of the past. I welcome Chicago Atlantic’s participation in this program and applaud their recognition of the value that New York’s cannabis program will provide to so many.”

Fund Created Last Year

Last year, Hochul included the creation of the New York State Cannabis Social Equity Investment Fund in the state budget for the 2023 fiscal year. The provisions of the public-private partnership set a goal of $200 million, including $50 million from state cannabis taxes and $150 million in outside investments. The investments are designed to fill a gap in investment funding available for cannabis businesses, which face difficulty securing capital because of the continued illegality of cannabis at the federal level.

The fund will be used to support individuals impacted by the inequitable enforcement of cannabis laws who have received Conditional Adult Use Cannabis Dispensary (CAURD) licenses from the New York State Office of Cannabis Management (OCM) and the Cannabis Control Board. Under the state’s cannabis regulations, at least 300 of the state’s first CAURD licenses have been reserved for justice-involved entrepreneurs.

Chicago Atlantic manages a diversified portfolio of credit investments in the cannabis industry and has deployed over $1.8 billion across more than 50 investments. The company’s flagship investment vehicle, Chicago Atlantic Real Estate Finance, is a mortgage real estate investment trust that offers secured loans to state-licensed cannabis operators.

“Thank you to Chicago Atlantic for investing in New York’s first adult-use retail licensees,” New York State Office of Cannabis Management executive director Chris Alexander said. “This infusion of capital will provide necessary support to licensees and will help New York further its work of establishing an inclusive cannabis market that creates opportunities for entrepreneurs harmed by prohibition and locked out of markets in other states.”

Loans For New Pot Shops

New York’s cannabis social equity fund will help those who have a CAURD license meet the costs of establishing recreational marijuana retail dispensaries, including the identification and leasing of suitable retail locations and the design, construction, and furnishing of the spaces. The Social Equity Servicing Corporation (SESC), a subsidiary of the Dormitory Authority of the State of New York (DASNY), is executing the work to develop dispensaries as an agent for the Cannabis Social Equity Investment Fund.

Last year, DASNY put out a request for proposals for a team to manage the cannabis social equity fund and raise the additional $150 million through private investments. In June 2022, the agency announced that it awarded the contract to Social Equity Impact Ventures, a joint partnership between Webber Willis Ventures LLC, a company headed by NBA Hall of Famer Chris Webber and his business partner Lavetta Willis, and a firm affiliated with Siebert Williams Shank.

“We are honored by Chicago Atlantic’s recognition of the Fund’s role in fostering social equity within the NYS cannabis industry. With our dedicated partners, we are committed to breaking down barriers and creating a more inclusive landscape,” said Webber. “This transformative collaboration marks a significant milestone in our collective journey towards a future where every individual has equal access to opportunity and funding therefore empowering communities and driving positive change.”

While the goals of New York’s cannabis social equity program have been lauded as a way to ensure participation in the legal recreational market by those who have borne the brunt of decades of prohibition and disparate enforcement, critics have derided the slow pace of dispensary openings. The first adult-use cannabis retailer opened its doors in the final days of 2022. But since then, less than a dozen shops have opened statewide, according to information from the OCM. 

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Aid is on the way for struggling farmers in two of the Emerald Triangle’s three counties, with funding available to help improve drought resilience and licensing compliance.

Cannabis for Conservation (CFC), a Humboldt County, California-based 501(c)(3) environmental nonprofit, announced $2.5 million in grant funds to assist small cannabis farmers through the California Department of Fish & Wildlife’s Cannabis Restoration Grant Program via the Qualified Cultivator Funding Opportunity, according to a Feb. 28 press release.  

Small farmers in the Emerald Triangle, an area where the economy is built on cannabis farming, have been “pushed to the brink” due to the impact of legalization, Cal Matters reports. It’s a region with over a quarter million people, and nearly everyone living in the region is either directly or indirectly reliant on cannabis. Cannabis has been the area’s staple crop since the ‘70s, with some farms in operation for generations. The rollout of grant funding couldn’t be more urgent, according to locals.

The two grants that were announced—Implementing Drought Resilience Strategies on Humboldt County Cannabis Farms and Provisional to Annual License Transitions for Trinity County Cultivators—will collectively assist 89 farms across eight priority watersheds with environmental work. 

“We see a great opportunity for conservation with this nascent industry, especially given that many farmers own large tracts of land in one of the most biodiverse ecoregions on the planet,” said Jackee Riccio, the co-founder and executive director of CFC.

CFC’s Drought Resilience Program aims to improve sustainable water consumption on some 17 farms. They will do this by installing rainwater catchment systems, increasing water storage capacity, and/or hardening and improving irrigation. This, they believe, will improve on-farm drought resilience and reduce direct impacts to water sources during low-flow periods. 

According to the Environmental Protection Agency (EPA), “the frequency, intensity, and duration of drought events” is increasing at rates not seen before. 

The point of this isn’t to transform small farms into monopolies, however: CFC stipulates that none of these water improvements will be used to increase cultivation footprints, farm size, or number of licenses, but rather reduce or eliminate extraction from water resources during dry periods and in some cases, convert farms to 100% water storage.

The Provisional to Annual License Program, on the other hand, aims to assist 72 Trinity cultivators in achieving an annual County and Department of Cannabis Control (DCC) license. The grant aims to provide professional help to small farmers to finalize annual licenses, including “completing documentation for California Environmental Quality Act (CEQA) compliance and Special-Status Species Mitigation and allow for a Technical Advisory Committee between CDFW, CFC, and the county to quickly resolve licensing obstacles that arise.”

CEQA is a California law dating back to 1970 that requires environmental review of proposed cultivation projects. All annual state cannabis licenses must comply with CEQA. The DCC may only issue an annual license once a project complies with CEQA. In addition, DCC has requirements for standard operating procedures, training employees, and how operations must be set up. 

CFC’s applied conservation approach focuses on collaborative, on-farm research, biodiversity enhancements, and environmental education. 

The goal is to bring together scientists and farmers to implement peer-reviewed conservation practices, with benefits provided to wildlife, land, and water. 

“Working with farmers and transforming monocultures into functional agroecosystems is a priority strategy among conservationists globally and we’re doing our part in that here, in the heart of cannabis country to return to the back-to-the-land values that this industry was born from,” Riccio added.

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Legislation proposed in Arizona would provide millions of dollars in grant funding to expand research into psilocybin––the primary psychoactive component in magic mushrooms––as a potential treatment for certain mental health conditions.

The bill, introduced by a Republican lawmaker and backed by Democrats, “would put $30 million in grants over three years toward clinical trials using whole-mushroom psilocybin to treat mental health conditions like depression and PTSD,” the Arizona Mirror reports. 

The outlet reports that one of the bill’s biggest backers is Dr. Sue Sisely, an internal medicine physician who believes that psilocybin treatment could be a boon for ailing military veterans. 

“It’s curbed their suicidality, it’s put their PTSD into remission, it’s even mitigated their pain syndromes,” Sisely said of patients she has seen benefit from psilocybin, as quoted by the Arizona Mirror. “It’s shown evidence of promoting neurogenesis (the growth and development of nerve tissue). There’s all kinds of great things that are being uncovered, but they’re not in controlled trials—they’re anecdotes from veterans and other trauma sufferers.” 

According to the Mirror, “so far the only controlled trials on psilocybin to treat medical conditions have used a synthetic, one-molecule version of the substance, which is vastly different from a whole mushroom, which contains hundreds of compounds.”

“These agricultural products are very complex, and that is what people are reporting benefit from,” Sisley told the Arizona Mirror. “Nobody in the world has access to synthetic psilocybin unless you’re in one of these big pharma trials.” 

In the last decade, psilocybin has gone from the fringes to the mainstream, as researchers and policymakers have grown more amenable to mushrooms as an effective treatment for a variety of different disorders. 

It has also become the next frontier for drug legalization advocates, as states like Arizona consider measures that would expand its usage. 

To the north of the Grand Canyon State, advocates in Utah have launched a campaign to push legislators to legalize psilocybin for clinical and academic purposes.

“Numerous robust studies have shown that psilocybin therapy is beneficial in reducing treatment-resistant depression, anxiety, addiction, trauma, obsessive-compulsive disorder, and other mental health disorders. It is more effective than synthetic pharmaceuticals by a large margin. Psilocybin has also shown effectiveness in easing fear and anxiety in people with terminal cancer. For instance, a groundbreaking study performed by John Hopkins Medicine found that psilocybin reported better moods and greater mental health after participating in a single clinical dose,” Utah Mushroom Therapy, the group behind the campaign, says in a statement.

The group is looking to gin up public support for the treatment after the state’s Republican governor, Spencer Cox, signed a bill last year establishing a task force that will study psilocybin as a mental health treatment.

Utah Mushroom Therapy says that, in the wake of the task force, “legalizing and decriminalizing Psilocybin in Utah is now very likely but still needs public support.”

“The use of mushrooms has been documented in 15 indigenous groups in America and various religious communities in Utah. This petition supports those groups who wish to use psilocybin safely, sincerely, and as a necessary part of their religion. The use of psilocybin does not contradict other Utah cultures and is protected by the first amendment as well as the Religious Freedom Restoration Act. This petition is to advocate Utah law to protect the religious rights of Utahns,” the group says. 

“Psilocybin is a natural, non-toxic substance. Despite this, it is currently a Schedule I substance. Scientists have demonstrated it has profound medicinal value and believe serotonergic hallucinogens assist cognitive processes and should be decriminalized. Psychedelics can change perception and mood, help people soften their perspective and outlook, and process events that may otherwise lead to substance abuse, trauma, and criminal behavior,” it continues.

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Community colleges in New York are set to receive millions in funding “to support the creation or enhancement of short-term credential programs or course offerings that provide pathways to employment in the cannabis industry,” the state announced on Monday.

Four schools that are a part of the State University of New York (SUNY) and City University of New York (CUNY) systems will receive a total of $5 million that the state said will support “programs that will create or enhance non-degree and degree-eligible courses and programs, stackable credentials, and/or microcredentials that quickly address local employer skill needs within the cannabis sector, a projected multi-billion dollar industry with tens of thousands jobs.”

“New York’s new cannabis industry is creating exciting opportunities, and we will ensure that New Yorkers who want careers in this growing sector have the quality training they need to be successful,” New York Gov. Kathy Hochul, a Democrat, said in a press release on Monday. “Diversity and inclusion are what makes New York’s workforce a competitive, powerful asset, and we will continue to take concrete steps to help ensure everyone has the opportunity to participate in the cannabis industry.” 

The funding is part of the Empire State’s continued preparation for its new regulated cannabis industry that is expected to launch at some point this year.

New York legalized recreational pot use for adults last year, which gave the greenlight to individuals 21 and older to toke up in public and to carry up to three ounces of weed. 

Under Hochul, who took office last August following the resignation of Gov. Andrew Cuomo, the state’s cannabis market has steadily taken shape.

New York’s first recreational cannabis crop is nearing harvest, with the state’s established hemp farmers receiving the first slate of cultivation licenses.

As in other states that have ended pot prohibition, New York has made a concerted effort to provide a redress to those who have been harmed by the War on Drugs.

Earlier this year, the state said that the first round of dispensary licenses would go to individuals previously convicted of pot-related offenses, or family members of individuals with such convictions.

In the announcement on Monday, the state said that the “cannabis credentialing program aligns with Governor Hochul’s continued commitment to delivering new employment opportunities to New Yorkers, especially those from historically underserved communities, while also supplying local employers with a highly skilled, locally sourced talent pool.”

Three SUNY campuses were selected to receive $1 million each: Schenectady County Community College, which will “serve as lead campus with partners Adirondack Community College, Columbia-Greene Community College, and Fulton-Montgomery Community College,” and “is estimated to include over 300 participants”;  Niagara County Community College, which will “serve as lead campus with partners Erie Community College, Genesee Community College, and Jamestown Community College, and will “include over 4,000 participants”; and Orange County Community College, which will “serve as lead campus with partners Dutchess Community College, Rockland Community College, Sullivan County Community College, Ulster County Community College, and Westchester Community College, and is expected to “include over 200 participants.”

One CUNY campus—Borough of Manhattan Community College—will receive $2 million, and will “serve as lead campus with partner Lehman College” and is expected to include more than 360 participants.

Those selected schools “must also partner with local employers in the cannabis industry and receive their input on curriculum development,” the state said in the press release, which also noted that “the New York State Department of Labor and the Office of Cannabis Management will support efforts to expand learning opportunities by helping to connect businesses and job seekers to these essential training programs.”

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