Like several other legal cannabinoid-focused operations, her cakes and gummies business is woven into the fabric of her community.
The legislators who wrote the New Jersey Cannabis Regulatory, Enforcement Assistance, and Marketplace Modernization Act and the Cannabis Regulatory Commission created by that law have made a concerted effort to get folks from communities affected by the War on Drugs—particularly Black and Brown people, and people from disadvantaged areas—off on the right foot with market regulations that favor their participation.
She has investors and some of her own money, but not the type of money that allows her to put tens of thousands monthly into something that’s not a guarantee.
“Here it is, I’m a social equity applicant, and everyone’s trying to get money out of me,” Solana said.
The so-called “pot-tax” is ubiquitous even among well-intended landlords who cite the continued federal prohibition on adult use cannabis and the attendant legal risks as justification for the high costs.
To tackle fees associated with launching a cannabis business, neighboring New York will soon launch a $200 million fund for social equity applicants to draw from to set up their cannabis business.
“I told them to I’m not doing that.
When you look at the cannabis market nationwide, a lot of the small grow operations nationwide go under, because farmers and cultivators make the least,” said Cabrera.
Now that she has her conditional Class 1 Manufacturing license, it’s “definitely easier” to find landlords willing to work with her, and Cabrera said she has a few potential spaces.
“Part of the hurdle going from a conditional to an annual is we need to submit our real estate and it needs to be municipally approval.
Beyond real estate costs on the private market, public market requirements of getting into the cannabis space also aren’t cheap: Many municipalities are charging application fees, and those fees don’t guarantee that a business will result.
If and when a business becomes operational, additional municipal fees can be imposed.
Zoning itself is another issue, explained Figaro, who noted that putting dispensaries away from residential areas makes accessibility an issue for folks who get around by public transportation or bicycle.
“If they want to be competitive with the legacy market they’re going to have to start thinking about accessibility, and real accessibility.
If he’d procured real estate months ago and due to delays had paid $100,000 or $200,000 in rent already without having his business any further along—at this point, he believes, an investor might only give him more money if he coughed up more equity; and then somewhere down the line, his business would no longer be his.