Qualifications
Tier 1:Low Income (earnings of less than $41,230 annually) and either (a) a cannabis conviction prior to November 8, 2016 that could have been prosecuted as a misdemeanor or citation under current law OR (b) 5 years cumulative residency in a qualifying zip code. 51% ownership by the Social Equity Applicant is required.
Qualifying zip codes are: 90057, 90037, 90062, 90003, 90061, 90059, 90061, 90001, 90011, 90008, 90016, 90013, 90059, 90002, 90014, 90021, 90044, 90043, 90037, 90058, 90008, 90027, 90033.
Tier 2: (a) Low Income and 5 years cumulative residency in a qualifying zip code OR (b) 10 years cumulative residency in a qualifying zip code. 33⅓% ownership by the Social Equity Applicant is required.
Tier 3: Landlords who enter into a Social Equity Agreement with the City of Los Angeles to provide capital, leased space, business, licensing and compliance assistance to Tier 1 and Tier 2 applicants. These landlords are also going to provide access to property for Tier 1 Applicants rent-free with prorated utilities for 2 years (or more), provided that the property meet certain requirements.
1. business, licensing and compliance assistance; 2. expedited renewal processing; 3. program site specific conditions; 4. the potential for fee deferrals if the City Council adopts a fee deferral program; and 5. access to an Industry Investment Fund if established.
Tier 2:
1. business, licensing and compliance assistance; 2. expedited renewal processing; and 3. program site specific conditions.
Tier 3:
1. expedited renewal processing; and 2. program site specific conditions.
Workforce
Requirements a good faith effort to employ 50% of the weekly hourly workforce from the residents living within a 3 mile radius of the cannabis business premises, with 20% Social Equity Workers (same requirements as Tier 1 SEP applicants) and 10% Transitional Workers.
Tier 3:
a good faith effort to employ 50% of the weekly hourly workforce from the residents living within a 3 mile radius of the cannabis business premises, with 30% Social Equity Workers (same requirements as Tier 1 SEP applicants) and 10% Transitional Workers.
Restrictions for All Social Equity Applicants:
- Ownership or control of the entity that obtains the license can only be transferred to another person who qualifies for the same Tier as the original applicant and the transfer must be approved by Los Angeles Department of Cannabis Regulation.
- Prior to license approval, disclosure of any encumbrances or debt with disclosure of the borrower’s and the lender’s responsibilities and liabilities for the debt held by the applicant.
- Bylaws (for corporations) or Operating Agreements (for LLCs) must reflect ownership interest percentages and must be submitted to the by Los Angeles Department of Cannabis Regulation.
- Prior approval by the by Los Angeles Department of Cannabis Regulation for any loans made with disclosure of the source and terms of the loan. If the by Los Angeles Department of Cannabis Regulation believes that the debt may interfere with the applicant’s success, Tier status may be denied.
- Disclosure of any employee or management agreements.
- Disclosure of any options to purchase equity or control in the licensed entity.
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