Administrators of a New York state fund that raised public money to help “justice-involved individuals” start cannabis businesses say they have set aside more than $1 million for themselves as the fund struggles to meet its goals. The City newspaper on Thursday reported that he paid .
Despite falling short of its goal of helping 150 people open stores, Social Equity Impact Ventures has received approximately $1.7 million in payments in the past 12 months and has only started 21 stores in 2.5 years. , also failed to meet its funding goal. According to to document obtained by the city. The program, with $50 million in public funding and $150 million in private equity, will allow individuals who had problems with state cannabis laws before legalization to start their own cannabis businesses. The aim is to support the According to Submit to New York State Dormitory Authority (DANSY).
In addition to its investment, the state owns a 49% stake in the fund, according to City Newspaper.
The three members of the management group include former New York City comptroller and Democratic mayoral candidate Bill Thompson, former NBA star Chris Webber and former Los Angeles sneaker entrepreneur LaVetta Willis, according to City. It is said that it was It is estimated that if there are no changes in financing or investment in new stores, managers could increase revenue by about $15 million over 10 years.
The city said the payments were funded by a 2% annual fee on contributions to the fund. (Related: Court of Appeals rules upholding New York state law restricting gun use in ‘sensitive areas’ following Supreme Court decision)
Governor Wes Moore of Maryland, Governor Kathy Hochul of New York, and Governor Tim Walz of Minnesota speak to reporters after meeting with US President Joe Biden at the White House in Washington, DC, on July 3, 2024. . (Photo by Anna Moneymaker/Getty Images)
The fund has been heavily criticized since its creation, with emails obtained by the city saying that Matthew Greenberg, a former financial analyst for the Bureau of Cannabis Control, said that “$50 million was not paid to the fund for a 2% fee.” “It will be completely used up,” he said. Condition for over 10 years.
“Social Equity Impact Ventures has raised a significant amount of money from the fund, money that could have been used to support more social equity businesses,” said Lucas, co-founder of cannabis consulting firm Candelta. Mr McCann told The City. “Rather, it goes back into their own pockets.”
The fund’s commitment to provide loans of $800,000 to $1.2 million to businesses at 10% interest in January 2023 was never formally proposed in writing, and instead was The interest rate has been raised to a maximum of 13%. Unable to raise funds from investors by the September 2022 deadline, the company instead took a $150 million loan from a private equity firm.
“They’ve never done what they wanted to do, so why are they getting paid?” McCann told The City.
Hochul’s office and DANSY did not immediately respond to requests for comment from the Daily Caller News Foundation.
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