cawacko
Well-known member
I know we have some weed smokers on this board. How many of you hippies (I kid, I kid) are familiar with these equity weed programs or have them in your area?
They were meant to help people hurt by the war on drugs, but most haven’t worked out. The costs are high, the rules are a mess, and the black market still undercuts legal shops. A few folks have made it work, but they’re the exception.
Shawn Richard stood in a surging Haight-Ashbury crowd one morning in December 2019, golden scissors in his hands. If anyone deserved to cut the ribbon on what should have been San Francisco’s marquee cannabis store, it was the “king of legal weed.”
Richard has said he started dealing drugs at 13 and later landed in prison. He kept selling after he came home, stopping only when his little brother was slain at age 20 on Easter Sunday of 1995. Tragedy inspired Richard to remake himself into a nonviolence advocate. And now, at the sunny end of this long arc, he was the city’s model marijuana-industry success story.
“It’s been a long time coming,” he said. And it had. California voters legalized recreational cannabis in 2016. The first sales were Jan. 1, 2018. But it took San Francisco policymakers until nearly 2020 to figure out how to sideline the corporate types seizing the market in other places and center people like Richard instead.
Now here he was, the first permit holder in the city’s “social equity program,” which reserved cannabis business licenses for people “unfairly burdened by the War on Drugs.” This meant Richard and his store, Berner’s on Haight, would also be an experiment: to see if legalization could atone for decades of racist law enforcement excesses and empower small businesses, some owned by members of the city’s dwindling Black populace.
Richard was fully committed. As the only weed retailer allowed on the main drag of the Haight-Ashbury thanks to strict zoning laws, he’d resisted temptation to sell out, telling Wired he rejected cash offers from “big dogs” to use his permit. Not good enough; he was the big dog. And as a founder of the San Francisco Equity Group, he would lead the way for other applicants. “I hope every other person of color can look at this and see it can really happen,” he told the Chronicle at the time.
It didn’t hurt that Richard had power behind him. He and then-Mayor London Breed, both of whom grew up in Western Addition public housing, had known each other most of their lives. One of Richard’s business partners, Conor Johnston, was a combative former Breed chief of staff and “periodic adviser” to the mayor who had pivoted to cannabis. Another partner, Johnny Delaplane, was part of a group that won a permit in 2017 to run a medical dispensary on Bryant Street called Project Cannabis.
That this well-connected dream team had snagged the first “equity” permit — and that two of the three frontmen were white — prompted grumbles. Competitors saw the “city family” doing itself favors again. But Richard also had the best marketing: Standing with him on opening day, in a black alligator jacket, was the draw for the crowd: Berner, a San Francisco native born Gilbert Milam Jr., the co-founder and public face of Cookies, perhaps the best-known marijuana brand in America.
Under a licensing deal inked the month before, Richard’s store would be the first recreational cannabis outlet in San Francisco to use the brand’s coveted intellectual property, tapping Berner’s Instagram-powered marketing machine while selling its iconic strains like Gary Payton, Sunset Sherbet and Powerzzzup. The potential was obvious — for everyone. Two Cookies stores in Los Angeles, styled in urban chic with gleaming white floors and the brand’s light-blue hue on the walls, were already ringing up close to $1 million in sales a month. As a sweetener, Cookies floated the team a $760,000 loan for startup costs.
About the only hiccup was the name. The city worried that a store called “Cookies” would be too appealing to children. Naming the store after Berner instead was the compromise. Any fears that the buying public would be confused disappeared the night before the grand opening, when a mob of Cookies fanatics pitched camp on the sidewalk.
Amid the good vibes, there was little to indicate what was to come: That the store would go belly-up in a little more than four years. That the great expectations of the equity program and legal cannabis would crumble along with it. And that, despite the failure, Richard and his partners would still be poised to pocket millions — with Cookies footing the bill.
When Richard snipped the ribbon, the queue of customers snaked down Haight Street, up Cole and almost all the way to Waller. “The sky was the limit,” Parker Berling, Cookies’ president, had said during negotiations for the licensing deal. And on that morning, who would have doubted him?
A near-century of marijuana prohibition wrecked many lives while creating wealth for a select few willing to run the risk. It was axiomatic that legalization would make new moguls — but who?
Policymakers in some places chose legalization’s winners and losers themselves by doling out a limited number of business licenses. The temptation was too much. Envelopes filled with cash passed hands. A Massachusetts mayor went to federal prison for bribery. As would later be revealed, other firms seeking market position were cultivating corruptible officials across California.
Seeking to avoid that mess, San Francisco electeds decided they should have no say at all. Marijuana regulators would issue permits not through a lottery (you could rig that) or a scored application (too subjective) but to whoever completed an online application the quickest.
Though city law did not cap the number of permits allowed, zoning did. Cannabis retailers couldn’t be too close to a school, a park or another weed store, creating “green zones” and bidding wars for available commercial space. On Haight between Masonic Avenue and Stanyan Street, just one shop would be allowed.
When the application portal opened at 10 a.m. on May 22, 2018, the city advised applicants to set aside “about two hours.” An ownership group that included Haight Street merchant Alex Aquino and Mike Musleh, owner of the Pork Store Cafe, submitted its application for a cannabis coffee shop concept just before noon.
They thought they’d done well.
They had no chance. The Richard-Johnston-Delaplane team submitted in an “exceptionally fast” eight minutes, Nicole Elliott, then the director of the San Francisco Office of Cannabis, later told the Examiner. The second-fastest application arrived in 13 minutes, records show.
It soon emerged that Johnston had been part of a small cohort that Elliott’s office invited to test a beta version of the application. Rather than slog through forms manually once the portal opened, his team leaned on another of the partners, a “tech wizard and ‘Star Wars’ nerd” named Quentin Platt, who tailored software to “autofill information,” Johnston later told me.
That the mayor’s friends had outhustled and outsmarted everyone else was no problem for some. “We were concerned about a dispensary in the neighborhood,” said Ted Loewenberg, the executive director of the now-defunct Haight Ashbury Improvement Association. Any worries he had over a “dope store,” though, were allayed when he found out Johnston was involved.
The team’s competitors, however, were furious. “It’s all political — come on,” Alexis Bronson, a Black entrepreneur who tried to partner with a Seattle-based outfit for a permit a few doors up Haight, told me after Berner’s opened. (Their application took 35 minutes.)
The Aquino-Musleh team went further, alleging in a May 2019 lawsuit that the city “discriminated against its citizens in favor of those applicants who are better-connected at City Hall.” They didn’t actually want to sell weed, the suit claimed. Instead, the play was to “reap a windfall” reselling the permit.
Johnston and Delaplane would not comment for this story, and Richard did not respond to repeated requests for comment. In a 2019 interview with the Examiner, Johnston insisted the beta testing did not provide “any advantage” to his ownership team, named the Cole Ashbury Group.
City officials also denied any favoritism. The idea that City Hall “shepherded politically connected individuals through the application process is false,” Elliott wrote in a Nov. 20, 2018, letter.
Johnston scolded me when I pressed him about the episode a few weeks after the big opening. That was old news. “And in focusing on a refuted allegation from one of our competitors, you’re missing the important story,” he said. Getting a permit, he said, wasn’t even half the battle. Equity applicants needed startup capital, and with the industry shut off from institutional financing, creativity was key.
They were meant to help people hurt by the war on drugs, but most haven’t worked out. The costs are high, the rules are a mess, and the black market still undercuts legal shops. A few folks have made it work, but they’re the exception.
San Francisco’s first ‘equity’ weed store was an epic failure. City Hall insiders may still pocket millions
The cannabis shop on storied Haight Street had it all: Prime real estate, star power, political clout and social justice. Then things got ugly.
Shawn Richard stood in a surging Haight-Ashbury crowd one morning in December 2019, golden scissors in his hands. If anyone deserved to cut the ribbon on what should have been San Francisco’s marquee cannabis store, it was the “king of legal weed.”
Richard has said he started dealing drugs at 13 and later landed in prison. He kept selling after he came home, stopping only when his little brother was slain at age 20 on Easter Sunday of 1995. Tragedy inspired Richard to remake himself into a nonviolence advocate. And now, at the sunny end of this long arc, he was the city’s model marijuana-industry success story.
“It’s been a long time coming,” he said. And it had. California voters legalized recreational cannabis in 2016. The first sales were Jan. 1, 2018. But it took San Francisco policymakers until nearly 2020 to figure out how to sideline the corporate types seizing the market in other places and center people like Richard instead.
Now here he was, the first permit holder in the city’s “social equity program,” which reserved cannabis business licenses for people “unfairly burdened by the War on Drugs.” This meant Richard and his store, Berner’s on Haight, would also be an experiment: to see if legalization could atone for decades of racist law enforcement excesses and empower small businesses, some owned by members of the city’s dwindling Black populace.
Richard was fully committed. As the only weed retailer allowed on the main drag of the Haight-Ashbury thanks to strict zoning laws, he’d resisted temptation to sell out, telling Wired he rejected cash offers from “big dogs” to use his permit. Not good enough; he was the big dog. And as a founder of the San Francisco Equity Group, he would lead the way for other applicants. “I hope every other person of color can look at this and see it can really happen,” he told the Chronicle at the time.
It didn’t hurt that Richard had power behind him. He and then-Mayor London Breed, both of whom grew up in Western Addition public housing, had known each other most of their lives. One of Richard’s business partners, Conor Johnston, was a combative former Breed chief of staff and “periodic adviser” to the mayor who had pivoted to cannabis. Another partner, Johnny Delaplane, was part of a group that won a permit in 2017 to run a medical dispensary on Bryant Street called Project Cannabis.
That this well-connected dream team had snagged the first “equity” permit — and that two of the three frontmen were white — prompted grumbles. Competitors saw the “city family” doing itself favors again. But Richard also had the best marketing: Standing with him on opening day, in a black alligator jacket, was the draw for the crowd: Berner, a San Francisco native born Gilbert Milam Jr., the co-founder and public face of Cookies, perhaps the best-known marijuana brand in America.
Under a licensing deal inked the month before, Richard’s store would be the first recreational cannabis outlet in San Francisco to use the brand’s coveted intellectual property, tapping Berner’s Instagram-powered marketing machine while selling its iconic strains like Gary Payton, Sunset Sherbet and Powerzzzup. The potential was obvious — for everyone. Two Cookies stores in Los Angeles, styled in urban chic with gleaming white floors and the brand’s light-blue hue on the walls, were already ringing up close to $1 million in sales a month. As a sweetener, Cookies floated the team a $760,000 loan for startup costs.
About the only hiccup was the name. The city worried that a store called “Cookies” would be too appealing to children. Naming the store after Berner instead was the compromise. Any fears that the buying public would be confused disappeared the night before the grand opening, when a mob of Cookies fanatics pitched camp on the sidewalk.
Amid the good vibes, there was little to indicate what was to come: That the store would go belly-up in a little more than four years. That the great expectations of the equity program and legal cannabis would crumble along with it. And that, despite the failure, Richard and his partners would still be poised to pocket millions — with Cookies footing the bill.
When Richard snipped the ribbon, the queue of customers snaked down Haight Street, up Cole and almost all the way to Waller. “The sky was the limit,” Parker Berling, Cookies’ president, had said during negotiations for the licensing deal. And on that morning, who would have doubted him?
A near-century of marijuana prohibition wrecked many lives while creating wealth for a select few willing to run the risk. It was axiomatic that legalization would make new moguls — but who?
Policymakers in some places chose legalization’s winners and losers themselves by doling out a limited number of business licenses. The temptation was too much. Envelopes filled with cash passed hands. A Massachusetts mayor went to federal prison for bribery. As would later be revealed, other firms seeking market position were cultivating corruptible officials across California.
Seeking to avoid that mess, San Francisco electeds decided they should have no say at all. Marijuana regulators would issue permits not through a lottery (you could rig that) or a scored application (too subjective) but to whoever completed an online application the quickest.
Though city law did not cap the number of permits allowed, zoning did. Cannabis retailers couldn’t be too close to a school, a park or another weed store, creating “green zones” and bidding wars for available commercial space. On Haight between Masonic Avenue and Stanyan Street, just one shop would be allowed.
When the application portal opened at 10 a.m. on May 22, 2018, the city advised applicants to set aside “about two hours.” An ownership group that included Haight Street merchant Alex Aquino and Mike Musleh, owner of the Pork Store Cafe, submitted its application for a cannabis coffee shop concept just before noon.
They thought they’d done well.
They had no chance. The Richard-Johnston-Delaplane team submitted in an “exceptionally fast” eight minutes, Nicole Elliott, then the director of the San Francisco Office of Cannabis, later told the Examiner. The second-fastest application arrived in 13 minutes, records show.
It soon emerged that Johnston had been part of a small cohort that Elliott’s office invited to test a beta version of the application. Rather than slog through forms manually once the portal opened, his team leaned on another of the partners, a “tech wizard and ‘Star Wars’ nerd” named Quentin Platt, who tailored software to “autofill information,” Johnston later told me.
That the mayor’s friends had outhustled and outsmarted everyone else was no problem for some. “We were concerned about a dispensary in the neighborhood,” said Ted Loewenberg, the executive director of the now-defunct Haight Ashbury Improvement Association. Any worries he had over a “dope store,” though, were allayed when he found out Johnston was involved.
The team’s competitors, however, were furious. “It’s all political — come on,” Alexis Bronson, a Black entrepreneur who tried to partner with a Seattle-based outfit for a permit a few doors up Haight, told me after Berner’s opened. (Their application took 35 minutes.)
The Aquino-Musleh team went further, alleging in a May 2019 lawsuit that the city “discriminated against its citizens in favor of those applicants who are better-connected at City Hall.” They didn’t actually want to sell weed, the suit claimed. Instead, the play was to “reap a windfall” reselling the permit.
Johnston and Delaplane would not comment for this story, and Richard did not respond to repeated requests for comment. In a 2019 interview with the Examiner, Johnston insisted the beta testing did not provide “any advantage” to his ownership team, named the Cole Ashbury Group.
City officials also denied any favoritism. The idea that City Hall “shepherded politically connected individuals through the application process is false,” Elliott wrote in a Nov. 20, 2018, letter.
Johnston scolded me when I pressed him about the episode a few weeks after the big opening. That was old news. “And in focusing on a refuted allegation from one of our competitors, you’re missing the important story,” he said. Getting a permit, he said, wasn’t even half the battle. Equity applicants needed startup capital, and with the industry shut off from institutional financing, creativity was key.
