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Major cannabis CEO pulls out of state business association over its resistance to diversity

Friday, Apr 30, 2021

* GTI is one of the biggest cannabis companies in Illinois

April 29, 2021

Dear Chairman John Sullivan [at Cresco Labs], Executive Director Pam Althoff and the CBAI Executive Committee:

After being part of the Cannabis Business Association of Illinois since it started six years ago, we have made the decision to withdraw our membership and leave the association as of today.

We do not agree with the direction of the association or the focus that the governing body has established. We believe that expanding industry ownership and opportunity to new and diverse entrepreneurs should be CBAI’s top priority, along with addressing the cultivation side of the Industry. We have fundamental issues with several of the association’s self-interested initiatives. We do not want to be a thorn in CBAI’s side as membership seems aligned with your priorities, or at least willing to go along with them.

Given that Illinois is in the early innings of an adult use program, we expect change ahead. Dina Rollman and I are plugged in and around to help. If you would like to work with Dina on the social equity or cultivation priorities, please be in touch.

In the meantime, we will agree to disagree. Green Thumb’s main priority in Illinois is to increase diversity in ownership and create meaningful economic opportunities for minorities within the cannabis industry. I believe that if you talk the talk, you must the walk the walk. There is virtually no minority representation in our cannabis business community and our team is going to focus on being part of the solution. We believe Illinois still has the chance to lead by example.

Respectfully,
Ben Kovler
CEO
Green Thumb Industries

The House Executive Committee is meeting this morning, so this should make things interesting.

* I’m told that Kovler is legit and is a major believer in equity. From his Twitter account…


* A provision in state law forbids new cannabis dispensaries from being located less than 1,500 feet to an existing dispensary. This has created what advocates and people like Kovler are calling “social equity exclusion zones.” Check ‘em out…


* Related…

* Chicago-based marijuana giant part of federal pay-to-play investigation

* Green Thumb Industries Responds to Baseless Allegations by Chicago Tribune

…Adding… CBAI…

The Cannabis Business Association of Illinois believes social equity licenses must be issued as soon as possible and the General Assembly should focus on ensuring any change to cannabis law puts awards for social equity applicants at the forefront. This is no time for distractions. We have made clear that any negotiations on the law should occur between the General Assembly and the social equity applicants who have had their lives on hold waiting for licenses to be awarded.

CBAI has taken decisive action to ensure that social equity applicants have the best chance of success entering the marketplace:

    • The CBAI Minority Access Committee, wholly comprised of social equity applicants, is negotiating with members of the General Assembly and other social equity groups on the association’s behalf for legislation that advances the interests of minority applicants.
    • CBAI prioritizes issuing licenses to social equity applicants above all other changes in cannabis law, and continues to call on the Pritzker administration to focus its efforts on getting licenses into the hands of those the law was designed to help.
    • CBAI has called for the State of Illinois to reimburse social equity applicants for costs associated with the delay in awarding licenses.
    • CBAI incubates, coaches and mentors social equity applicants and established the Minority Business Associate Membership to give minorities a stronger voice in our association and in the industry statewide.

From the moment the cannabis bill became law, CBAI has advocated for policies that provide greater ownership opportunities for minority cannabis entrepreneurs, including set-aside licenses, innovative incubation and co-location programs, and omnibus legislative packages that would move the state forward on awarding social equity licenses.

- Posted by Rich Miller        

17 Comments
  1. - SouthSide Markie - Friday, Apr 30, 21 @ 10:25 am:

    I don’t know enough about the issue to comment competently about the merits. But the civil tone of the letter is something I’d like to see more of in public discourse.


  2. - @misterjayem - Friday, Apr 30, 21 @ 10:43 am:

    “The civil tone of the letter is something I’d like to see more of in public discourse.”

    Maybe we need more cannabis use prior to public discourse.

    – MrJM


  3. - Mockery - Friday, Apr 30, 21 @ 10:45 am:

    The law, as drafted, had great intentions. The law, as implemented, has not gone smoothly. Part of the problem is this industry grew so fast but government hasn’t kept up. The social equity licenses should have gone out a year ago. Too much money on the line to let this industry fail.


  4. - Larry Bowa Jr. - Friday, Apr 30, 21 @ 11:05 am:

    Come on. This is PR. A dude who got born on top of a mountain of money such that he’s positioned to acquire one of the initial grow licenses in Illinois is suddenly, many years later, VERY concerned about the lack of equity in the state’s licensing process. He just wants his competitors to get a fair shot at some of his revenue stream! That’s just the kind of capitalist he is.

    Sure thing.


  5. - SouthSide Markie - Friday, Apr 30, 21 @ 11:16 am:

    Mr. JM, Agreed. Both before, after and in matters having nothing to do with public discourse.


  6. - Fav Human - Friday, Apr 30, 21 @ 11:23 am:

    I believe that if you talk the talk, you must the walk the walk.

    No doubt he’s going to vacate one of his locations in favor of an equity candidate once those are announced……


  7. - Cool Papa Bell - Friday, Apr 30, 21 @ 11:27 am:

    To the point of an exclusion zone - In the case of the circle around Wrigley field - That circle is where just 1 pot shop can be located? How many bars are in that circle? That rule has to go now. Why not give a minority owned business the second shop in each one of those circles.

    An aside - I’d much rather take my kids to the ball game (when we can again) and sit around a bunch of stoned Chads’ than the usual bro’s that I get stuck next too that are 8 Old Styles deep in the 3rd inning.


  8. - WestBurbs - Friday, Apr 30, 21 @ 12:12 pm:

    I’m a fan of Kovler’s position but I’m a bit skeptical. To be fair, that is primarily because I’ve been following Kovler’s treatment of the guy who was the genesis of GTI - and sure allegations are easy but looks like there is more than enough there to make Kovler look “sharp” in the bad sense of the word https://www.montereycountyweekly.com/news/cover/an-accusation-of-betrayal-mars-the-rising-star-of-cannabis-giant-green-thumb-industries/article_ae298484-f2e5-11ea-90a0-475c9acaaead.html


  9. - Rabid - Friday, Apr 30, 21 @ 12:15 pm:

    Now GTI can legally lower its prices, not part of the cartel


  10. - Candy Dogood - Friday, Apr 30, 21 @ 12:29 pm:

    ===No doubt he’s going to vacate one of his locations in favor of an equity candidate once those are announced===

    The existing industry stakeholders are engaged in rent seeking by trying to limit their competition. Demanding, expecting, or thinking that it is witty to suggest that a business that wants to increase the number of competitors they have do so by handing over one of their locations is just ridiculous and you should feel bad for even thinking this, much less posting it.

    The roll out of our pathway to legalized and recreational use was set up to make sure that only a handful of well heeled firms would be set to benefit and it is not in the public’s best interest to reward those well heeled firms with scarcity and force people to pay non-competitive prices.

    Supporting a system with reduced competition also keeps prices high which ultimately winds up rewarding the black market and organized crime.

    No reasonable person should be advocating for fewer dispensaries. No ethical person should be in favor of a cannabis industry that looks like the cast of The Whitest Kids U’ Know.


  11. - Friendly Bob Adams - Friday, Apr 30, 21 @ 1:15 pm:

    The legal weed roll out was pretty poorly done. There should be a lot more competition. These are not casinos where there can be only a limited number.

    Tax revenue shows that legal pot is very popular. Give the people what they want and more revenue will come in to the state.


  12. - Dotnonymous - Friday, Apr 30, 21 @ 1:19 pm:

    Just imagine the amount of tax dollars Illinois could be collecting and benefitting from…if the Illinois lily white monopoly men sold cannabis products at a fair (competitive) market price…those dollars go into the pockets of black market sellers from who knows where…minus any tax.


  13. - Dotnonymous - Friday, Apr 30, 21 @ 1:30 pm:

    In Decatur, where dispensaries are “Buffett banned”, I’m told marijuana can be obtained by opening one’s front door and asking nearly anyone within view, “Whose got green”…so, I guess the point of banning dispensaries was… what?


  14. - Shytown - Friday, Apr 30, 21 @ 3:31 pm:

    IDK but call me skeptical on this move. Also, this ultimately needs to be solved via legislative action, so there.


  15. - tennisshoos - Monday, May 3, 21 @ 8:02 pm:

    Oklahoma has it figured out. Do it like them and they won’t have to discriminate based on race and Ben can leave politics out of cannabis.


  16. - SandyC - Tuesday, May 11, 21 @ 2:35 pm:

    I don’t get involved in internal politics between cannabis owners…BUT, as a medical cannabis advocate, we’ve been told these same people above are against allowing patients to buy product in recreational only dispensaries. That is unacceptable and fairly greedy, IMO. The very people that got them to recreational are being denied products that are sometimes right down the street from them. Whereas, their medical dispensary is an hour or more away. Does that sound like our sick are being honored? I’d love to hear a good solid reason for this and not some lame excuse about ricing, software or legislative language…that btw, can be changed.

    Ok, off my soapbox. 🤷‍♀️


  17. - SandyC - Tuesday, May 11, 21 @ 2:36 pm:

    Sorry, meant *pricing. ^^


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