Former NBA star Chris Webber and an investment team have set out to raise money that will help entrepreneurs with marijuana convictions build cannabis dispensaries in New York, state officials said Wednesday.
Webber’s firm, Social Equity Impact Ventures LLC, submitted the winning proposal to create a $200 million social equity fund to the state’s housing finance team, the Dormitory Authority of the State of New York (DASNY).
With $50 million from the state and $150 million from investors, Social Equity Impact Ventures will establish and equip up to 150 marijuana dispensaries statewide. New Yorkers who receive the first recreational facility retail licenses can sublet the space from the state and repay the support with loans. The first round of licensing is limited to New Yorkers who have successfully run a business and who have a marijuana conviction or are related to someone who has a marijuana conviction.
Consistent with state and national trends, black and Hispanic Long Islanders were more likely to be arrested for marijuana offenses than their white counterparts, according to research by criminal justice reform groups. The Social Fund is part of the state’s strategy to ensure those punished during Prohibition aren’t pushed out of the new industry.
“We call that a success fund because that’s the only option,” said Webber, who played for five NBA teams from 1993 to 2008. Last year he was inducted into the NBA Hall of Fame.
“The only way is to make sure that not only do our applicants have wonderful access to funding and infrastructure, but they also have those quiet moments, those conversations when you have doubts,” he added, citing the group’s ability to listen and provide support and guidance.
His partners at Social Equity Impact Ventures include Lavetta Willis, who is working with Webber on a second fund for cannabis-related ventures; Suzanne Shank, CEO of minority and women-owned investment firm Siebert Williams Shank; and William Thompson, another officer of Siebert Williams Shank and former comptroller in New York City.
“We’ve been fighting to get to the table for so many years,” Shank said. “Now that we’re there, our mission is to help others come to the table.”
The fund managers are expected to receive $150 million in commitments from private investors by September 1 and run the fund for about a decade Guidance attached to the country’s call for proposals. Social equity impact ventures receive up to 2% of the money raised, the guidelines say.
The state took further steps Thursday to open the recreational marijuana field. The Cannabis Control Board, which oversees marijuana and hemp policy, approved 41 conditional cultivation licenses, one of which went to Suffolk-based Big Sky Ranch Holdings LLC. The company, which did not immediately respond to Newsday’s requests for comment, is now allowed to grow cannabis and only minimally process the plant.
The Cannabis Control Board voted to accept applications for conditional processing licenses from June 28 through August 31. To qualify, companies must have experience processing hemp, which comes from the same plant as marijuana and can be converted into CBD products believed to provide wellness benefits, but not high. Once licensed, processors can extract tetrahydrocannabinol (THC), the marijuana compound with psychoactive effects, and create oil packets for vapes and other products.