BY TAYLOR ENGLE | Photo courtesy of MedMen
Legalizing cannabis on a state and federal level is a thing to be celebrated for consumers and operators alike. But for the people who have been forced to operate in the shadows for several decades pre- and post-legalization—the legacy operators—things aren’t so simple.
While the legal industry logically should prioritize access and equity to cannabis professionals who’ve been at the helm of the plant’s progress over the past several decades, those seats at the table are instead being auctioned off to the highest (and whitest) bidders.
As adult use cannabis continues to legalize throughout the nation, brands and figures who have operated in and built the legacy cannabis market have been seeking justice, equity, amnesty, and a fair shot at finding their place in the legal market they helped bring to fruition.
When cannabis becomes legal wherever you reside, it feels like great news on the surface as the remaining stigma around weed finally has the potential to be lifted or at least curbed in your community. However, legalization also begs the question: should the fact that cannabis has been wrongfully illegal for decades take away from the legitimacy of that legacy and all the work they’ve done to destigmatize the plant and spread the word about its benefits?
The legacy cannabis market has been operating underground since cannabis was classified as a Schedule I Drug back in 1970. These are the people who built the cannabis industry as we know it today on their backs: those who risked everything to provide people in need with a plant that brings them healing, clarity, and peace.
“The legacy market set the stage for everything we do in cannabis today, especially cultivation,” said Tyson Rossi, Senior Vice President of Product & Revenue at MedMen. “The best growers I know started with a closet grow, were pheno-hunting in their bedrooms, and created the cultivation methods we rely on today."
As a former legacy operator himself in the '90s, Rossi brings a unique first-hand perspective of the pre-legal market in his current role at MedMen. He emphasized, "I have a deep respect for the legacy market, and I think there needs to be more reverence when we talk about their contributions to the industry. They risked and lost too much not to show them that respect. We, as an industry, also need to do a better job bringing that talent into the fold."
Not only did legacy operators establish today’s industry and the way business is done, but the way they’ve approached cultivation over time has cemented how product is cared for today. This experience and vast knowledge has been instrumental for today’s legislative change, like WAMM’s Valerie Corral and her influence on California’s Prop 215.
“Legacy operators have a lot to offer in terms of knowledge, expertise, and even genetics, and would instantly elevate the quality of product in the market while strengthening our connection to the culture—and that’s good for everyone," said Rossi.
As noble as these efforts have been for consumers and operators everywhere, these same operators are being shut out of today’s legal industry, left by the wayside as the market is auctioned off to the highest (and whitest) bidders.
Although cannabis is legal to purchase in states like California, Colorado, or Oregon, the illicit market is still alive and well in these regions and beyond, and people are still being imprisoned for cannabis-related crimes.
Despite their expertise and valuable insight, these operators are forced to continue selling underground because the legal market's infrastructure is blocking their path to legal success.
With exorbitant licensing fees, compliance, legal costs, and taxes to pay as high as 15% in California and Washington, mom-and-pop brands and other small cannabis business owners can’t muscle their way into the legal industry without a huge financial backing. Meanwhile, the suits in today’s legal market are sheltered by venture capitalist backings.
And while most of these businesses earn a good profit off of their legacy customers, they aren’t allowed to put any of it towards these costs because it was earned within the illegal market. “The reality is that the current tax structure and regulations in the legal Cannabis market are still stacked against legacy operators,” Rossi said.
“Under the current conditions, the system is not set up for most of those operators to thrive, and therefore they don’t participate. We as an industry owe it to the legacy operators to create a system that allows them to come into the regulated market and flourish, as it’s truly their shoulders we all stand on.”
Many other legacy brands like The People’s Dispensary have run into walls like this, resulting in 87% of 2020’s total cannabis sales revenue coming from the illicit market—a shocking $46 billion.
With statistics like these in mind, it just doesn’t make sense for the legal market to keep legacy people out of the industry. Overall revenue would increase more than seven times over, law enforcement would have more time and resources to focus on actual crime, and teenage use would likely drop even lower than it already has.
Bringing the legacy players into the conversation makes unequivocal sense for consumers, operators, lawmakers, and tax-paying citizens overall.
Instead, the legal market is currently saturated with people who might have the business experience and the deep pockets to finance their pursuits, but don’t know the first thing about cannabis.
Although the market has been legalized, there have been no measures taken to ensure people operating legally actually know what they’re talking about, how to make recommendations, or how to truly utilize the plant for benefit.
This is hugely problematic, especially for medical cannabis patients who are used to buying their products from people who are actually knowledgeable about the plant and its potential benefits. Without the proper knowledge behind why things are priced how they are, or the true differences between the types of cannabis products, consumers will continue to suffer at the hands of unprepared retailers.
Beyond the restrictions that continue to hold the legacy market back, the businesses and entrepreneurs lucky enough to break into legal operations are still faced with hurdles to overcome in order to continue operating within the law.
“Basically it’s hard to know if your brand from one small farm can have enough cannabis if your brand goes big,” said cannabis entrepreneur Chiah Rodriques in an interview with Cannabis Aficionado.
“You may need to start reaching out and getting cannabis for your brand from other cultivators. In Mendocino County, we have a disadvantage because we can only cultivate 10,000 sq. ft., but there is a push for there to be a ballot to change it to one acre.”
Rodriques went on to discuss what she believes to be the contributing factor in this disconnect: the fact that none of Mendocino County’s cannabis farmers were consulted when the new regulations were being created.
This oversight has quickly become a theme in legal cannabis in the U.S., resulting in lawmakers creating regulations for an industry they have no stake, experience, or expertise in. And while legal weed is supposed to result in less stigma, much of the industry still feels like it’s doing something wrong.
Former NBA star, outspoken cannabis advocate, and MedMen board member Al Harrington expanded on these concepts in his recent interview with Esquire, addressing the problem that lies with cannabis legislation relying too heavily on lawmakers who lack the proper knowledge to govern the plant.
“It's really about being able to get their ear, and when you have their ear, being able to have a very real conversation to hopefully help them change their way of thinking. I spent some time in New York pre-Covid talking to all of [Governor Andrew] Cuomo's aides, because I felt like they didn't really understand the significance of social equity,” Harrington said.
“And even after all that talking we did, I'm hearing that the new bill that they're proposing to go adult use [in New York] is missing social equity again. So for some reason, it's not registering in their heads of the issues in regards to diversity and inclusion.”
So what does an adequate solution really look like? In order for the legal cannabis industry to be fair, accessible, and truly profitable, lawmakers must account for the legacy market and provide them with the support they need to transition into a legal operation.
De La Rosa’s campaign brings attention to legacy amnesty, calling on lawmakers to consider the following when crafting legislation:
Legacy operators should be allowed to use their available funds without verifying the source; legacy operators should be able to sell existing and tested products; legacy operators shouldn’t be assessed or charged for back taxes; legacy operators should be supported with education, compliance measures, and workforce development resources; and legacy operators should be able to apply for a license with a discounted fee and no liquid asset requirement.
These are a few key requests that could have a significantly positive effect on the cannabis industry as a whole. As cannabis inches towards federal legality, the legacy market needs to be considered sooner rather than later, or the issues that consumers and operators currently face will only continue to pile on and persist.
Taylor Engle is a freelance writer, editor, and public relations/marketing specialist based in Brooklyn, New York. In her free time, she loves to cook, do yoga, and hang out with her cat.