“The sad part was people who were targeted when there was prohibition on cannabis, those same individuals were excluded from the cannabis industry.”

By Will Hammann, Maryland Matters

When Candice Peters opened Coastal Cure Cannabis in Delmar on June 1, it was the culmination of more than two years of hard work on a decade-old dream.

And that’s a fast turnaround compared to many of her peers.

Of the 83 “social equity” licenses for dispensaries that have been distributed by the state since 2023, only 17 are currently in operation, twice the number that were open at the start of this year as more and more finally get their businesses off the ground.

In addition to the challenges faced by any wishful entrepreneur, license holders say they also struggle with unique zoning issues, limited investors and unwilling real estate partners as the still-pervasive stigma around their product hangs in the air.

“It’s been a journey,” said Peters. “And there have been a lot of long nights, and longer days trying to jump…all of these hurdles.”

Peters, a physician who had long been interested in medical use of cannabis, first sought a license after marijuana was legalized for medicinal use in Maryland more than 10 years ago. But she didn’t come away with one then.

“There were no minorities, or very few minorities that got these licenses,” she said. “They were supposed to be a very blind application process. That turned out not to be true, which is how we end up here.”

The Cannabis Reform Act, which made recreational sales legal in 2023, also created the Maryland Cannabis Administration and the Office of Social Equity. It created the social equity licenses, for new dispensaries, growers and processors who came from Maryland communities—or who attended schools in communities—disproportionately affected by the war on drugs.

“The sad part was people who were targeted when there was prohibition on cannabis, those same individuals were excluded from the cannabis industry,” Peters said. “Multimillions of dollars have been made, and no one who was affected by it, decades ago, was able to really profit from that.”

That was echoed by Malcolm Gillian, founder of the Maryland Coalition for Cannabis Equity, a trade association representing social equity licensees like Peters.

“Cannabis should never have been illegal—the enormous impact and harm on folk in arrests and everything else—I definitely want to see that be corrected,” said Gillian, who said he is a few months away from opening his own dispensary.

He said his coalition, made up mostly of self-financed entrepreneurs, works to “make sure social equity licensees have the right funding opportunities, and frankly, when they get to market, have a chance to compete,”

Gillian said Maryland’s law, and the Cannabis Administration, have “created a very healthy, very robust, legal marketplace versus other states that are still challenged with killing the illegal markets.”

Sales have increased each year since recreational cannabis was legalized in 2023, according to data from the Cannabis Administration, totaling $3.46 billion since then and hitting a monthly record in April of $105 million in combined medical and recreational sales.

“The MCA remains committed to providing a safe, equitable and accessible medical and adult-use cannabis industry for qualifying patients and adult consumers,” the administration said in a statement.

Most dispensaries in the state began as medicinal-use operations that converted their licenses to sell recreational cannabis as well. There are 99 non-social equity equity licensed dispensaries currently operating in the state, according to MCA data.

Peters noted that part of regulating the industry has been ensuring that new businesses weren’t founded or swept up by larger investors with multiple locations, sometimes across multiple states.

“The resources that these multistate operators have, I mean, they’re so far above what we have access to,” she said. “Not just financially but in who we know, who we can contact to get expedited services.

“This round of licenses was critical to, not even evening the playing field, but at least allowing us to have a seat at the table,” Peters added. “If half those licenses are bought up by multistate operators, the other half of us would never be able to compete with those numbers.”

Making sure that social equity licenses stay in local hands is just one of the challenges the new businesses have faced. Peters, Gillian and Frank Hayes, an owner of Crabtree Cannabis in Kensington, said the law requiring that 65 percent of equity is held by the qualified applicant can make it especially difficult for social equity licensees to raise capital.

Hayes, who sits on the board of the Maryland Dispensary Association, has spent time lobbying to strike a balance between attracting investors and keeping ownership in the hands of the people the special licenses were meant for.

“We’re very limited in terms of what we can do from a marketing and advertising perspective,” he said. “We’ve lobbied to try to loosen up some of those restrictions with pretty little success.”

There are other challenges. Hayes and co-owner Felicia Covel Rami, owner of a catering business and Baltimore native who won a social equity license in the state’s lottery in 2024, were renovating a former bank to become their dispensary when the state ordered work halted after complaints from two nearby churches. State regulations prohibit dispensaries within 500 feet of places of worship.

It turned out the churches themselves lacked permits, and they were forced to move. Months after filing a lawsuit, the order was lifted, and their renovation could continue.

Hayes said just finding a location was a challenge, as many landlords or their major tenants are unwilling to share space with a cannabis dispensary, even if it complied with zoning laws.

“I think there is still certainly a stigma associated with cannabis because it’s federally illegal,” said Hayes, whose dispensary opened April 14. “I think a lot of that stigma originates from the war on drugs, which in my opinion was pretty misguided on behalf of the federal government.”

Acting Attorney General Todd Blanche in April reclassified medical cannabis from a Schedule I to a Schedule III drug. That put cannabis on the same level as pain medicine and ketamine, in the eyes of the federal government, instead of side by side with drugs like heroin and LSD.

That’s progress, said Peters and Hayes, who hope to see more cannabis research now that the rescheduling opens the door. But the order also created an uneasy future for the recreational side of dispensaries, since the federal Drug Enforcement Administration (DEA) still considers recreational cannabis illegal.

“If anything, this April decision has just created a lot of confusion,” Hayes said. “Some licensees have chosen to register and apply with the DEA, others have chosen not to, but I don’t think either camp has confidence [nor] clarity on the path forward.”

He and Covel Rami decided to register after their suppliers said they planned to do so, since registered businesses can’t deal with unregistered partners. Peters was already registered because of her medical career. But she noted that the DEA is the same agency that led the war on drugs that inspired the social equity license program and, “Choosing to trust them now, even for good reason, does cause me to pause.”

“To now include something that’s federally illegal, and submitting information to the DEA is a little frightening,” she said.

Hayes and Gillian, both of whom previously worked in California’s cannabis industry, said high taxes there in the past on adult-use cannabis had allowed an illegal market to continue to flourish. That is not the case in Maryland, which charges a 12 percent sales tax on the use of recreational cannabis, they said,

“There is no longer like a local weed guy [in Maryland], everyone just goes to the dispensary,” Gillian said. “It’s safe, it’s clean.”

“We’re in a state that has supported us,” Peters said. “I think Maryland does want us to be successful, so I’m hoping that they will support us going forward and moving through this whole process.”

As Peters moves forward, she said she hopes the unique perspective of social equity licensees can fulfill the program’s purpose.

“We’re intentionally trying to hire returning citizens, we’re intentionally trying to hire people of the underserved communities, and we’re intentionally trying to get the products out to those people as well,” she said. “I think as we destigmatize this, we’re only going to get more people that are using cannabis in a safe way.”

This story was first published by Maryland Matters.

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Illinois officials have posted a new form that recreational marijuana dispensaries can file in order to get permission to begin selling medical cannabis, which is taxed at a much lower rate than adult-use products.

The expanded opportunity for marijuana businesses comes as part of omnibus cannabis legislation that was passed by lawmakers and signed into law by Gov. JB Pritzker (D) this session.

The law also doubles the amount of marijuana that adults can legally possess, allows drive-thrus and curbside pickups at dispensaries and lets them stay open for longer hours of operation, among other changes.

The five-page form released this week by the Illinois Department of Financial and Professional Regulation (IDFPR) allows businesses holding an active Adult Use Dispensing Organization License issued under the state’s Cannabis Regulation and Tax Act to apply for a separate Medical Cannabis Dispensing Organization license.

“Any adult use dispensary holding an active license in good standing may opt-in for a medical dispensary license,” IDFPR said in previously issued guidance about changes made by the new cannabis omnibus legislation. “This medical dispensary license will allow the dispensary to sell cannabis to medical cannabis patients at the medical tax rate up to the medical patient’s allotment.”

Dispensaries can begin filing the form on September 10, and then they must wait for their so-called “15-37 License,” named after the section of the legislation, to be issued before they can begin medical cannabis sales.

Applicants must submit a non-refundable fee of $5,000 and, if approved, their standard renewal fee will then increase by an additional $10,000 per renewal cycle.

The new form, noted earlier by Illinois New Joint, asks about a business’s disciplinary history, ownership structure and tax compliance.

It also asks questions such as:

• Does the dispensary include materials or signs informing patients that possession of cannabis is illegal under federal law?
• Does the education plan offer information available to patients on the potential side effects of cannabis?
• Does the dispensary offer materials or signs informing patients that consuming cannabis is prohibited in public places?

Businesses also need to submit a patient prioritization plan that includes details about designating a medical cannabis line and registers that will serve medical cannabis patients first, as well as a floor plan showing a dedicated consultation area for patients.

The medical cannabis sales option for adult-use businesses is part of SB 3222, which was approved by the legislature and signed by Pritzker in June.

As enacted into law, the measure also allows residents of the state who are over 21 years of age to possess up to 60 grams of marijuana flower—double the amount in prior law. They are also able to have up to 10 grams of cannabis concentrates and infused products with up to 1,000 mg of THC—also double the earlier limit. Possession amounts for adult non-residents are also doubled under the bill and are generally set at half of what residents can carry.

Additionally, people with past convictions for possession of up to 60 grams of marijuana are now able to have those records expunged—double the previous cutoff allowing only those with convictions for up to 30 grams to be eligible.

The legislation also recriminalizes hemp THC products with more than 0.4 milligrams of THC per container, in line with a federal ban that is set to take effect in November.

The state’s list of medical marijuana qualifying conditions is also being expanded to add female orgasmic disorder, endometriosis, ovarian cysts and uterine fibroids.

The governor held a signing ceremony for the legislation at a marijuana dispensary, saying he is “proud that Illinois continues to lead the nation in showing what thoughtful, balanced cannabis policy can achieve.”

In 2019, Pritzker signed the state’s initial marijuana legalization policy into law.

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