NewHavenBIZ

12 n e w h a v e n B I Z | A u g u s t 2 0 2 1 | n e w h a v e n b i z . c o m B efore Gov. Ned Lamont signed into law the bill that legalized recreational cannabis in Connecticut, legislators and advocates spent months painstakingly laying out nearly 300 pages of legislation that detailed how the new industry will work. And that was the easy part. Now that legalized adult-use cannabis is the law of the land, much of the onus for standing up and regulating the industry falls to the Department of Consumer Protection, newly-created Social Equity Council (SEC) and Department of Economic and Community Development (DECD). DCP Commissioner Michelle Seagull, who is largely responsible for building out the legal cannabis industry's regulatory regime, said she expects retail sales will probably start by the end of next year. In the intervening time, DCP and other groups have a lot of work to do, from setting specific security standards for dispensaries to creating a state-run workforce development plan for the cannabis industry. "It's very important that we do it correctly, but I think it will happen quickly," Seagull said. "We want a program that reflects the values and priorities of Connecticut." e speed at which Connecticut's adult- use market can get off the ground partly depends on how quickly the SEC is formed and creates licensing criteria for cannabis businesses. Much of the SEC's responsibilities will deal with social equity applicants, such as identifying geographic areas in the state that have been disproportionately affected by the 50-year war on drugs. But the law gives SEC approval power over non- equity applicants as well. For example, the council must approve an applicant's social equity and workforce devel- opment plans before any license is granted. e council will operate as an independent body, but is administratively under the auspices of DECD, which will also hire the SEC's executive director, said Department of Economic and Community Development Commissioner David Lehman. Lehman said council members will make decisions and the director will implement them. DECD is currently interviewing candidates for the executive director position, Lehman said. Once formed, SEC members have to identify and publish a list of U.S. Census tracts that qualify as "Areas of Disproportionate Impact" by Aug. 1. Five days later, the SEC is supposed to begin looking for a third-party to conduct a study on racial disparities and consequences of the war on drugs, among other things. SEC members must finalize and publicly post final social equity applicant qualifications by Sept. 1. ose applicants can begin submitting forms 30 days later, and non-equity businesses can start applying 30 days aer that, the law says. Medical dispensaries may begin applying to convert their licenses to serve the adult-use market on Sept. 1. It's a tight timeline, Lehman admits. "I do think there's a chance of meeting these dates," Lehman said. "We're working as fast as we can." DECD is also tasked with helping develop a cannabis business accelerator program for prospective social equity businesses, and an industry workforce training program. e law dedicates $50 million to put these programs into action. A large part of the SEC's and DECD's mandates are to make sure large multistate operators don't completely dominate market share in Connecticut's adult-use cannabis industry, Lehman said. "It is clear established players that have access to capital have a real advantage," Lehman said. "We already know larger, established players are going to be aggressive." Licensing requirements Outside of equity concerns, the Department of Consumer Protection will serve as the cannabis industry's primary regulator. Once the SEC is formed and lays out its standards for equity measures, DCP will accept cannabis business license applications, decide how many licenses the state will allow for each of the nine license categories and oversee a lottery process that decides which applicants it will consider, Commissioner Seagull said. Licensing will likely be a complicated process, but the statute covers what it will look like in broad strokes. Aer DCP sets the maximum number of licenses, the state will hold two lotteries for each license category: one for social equity applicants, and the other for general applicants. DCP, at first, will issue a provisional license to qualified business operators, which will then have 14 months to get everything in order for final approval. Prospective cannabis businesses should keep an eye on the standards DCP develops for provisional licensure and have certain ducks in a row, including a business plan and a location amenable to Michelle Seagull Now that a 300-page cannabis bill has passed, regulators, others face monumental task getting industry off ground by 2022 By Sean Teehan PHOTO | YEHYUN KIM/CTMIRROR.ORG Race to Market CTPharma staff members trim dried marijuana flowers. A staff member at Rocky Hill- based medical cannabis grower CTPharma checks on the marijuana flowers. PHOTO | YEHYUN KIM/CTMIRROR.ORG

• Cover