The Massachusetts Cannabis Social Equity Trust Fund: What You Need to Know

By David M. Ullian

Feb 13, 2024

Chapter 180 of the Acts of 2022, An Act Relative to Equity in the Cannabis Industry, which went into effect in November 2022, established the Cannabis Social Equity Trust Fund (“CSE Trust Fund”) to encourage full participation in Massachusetts’ regulated cannabis industry by entrepreneurs from communities that have been disproportionately harmed by marijuana prohibition and enforcement.

The CSE Trust Fund is administered by the state Executive Office of Economic Development (EOED) and is intended to provide financial assistance to social equity businesses seeking to operate cannabis establishments licensed by the Massachusetts Cannabis Control Commission (the “CCC”).

State law, specifically M.G.L. Chapter 94, Section 14A, requires the EOED to create regulations governing the structure and administration of the CSE Trust Fund, and on February 2, 2024, the EOED’s Cannabis Social Equity Trust Fund Regulations, 400 CMR 8.00, were officially published.  

Below, you will find high-level information about the new CSE Trust Fund.

Who Is Eligible to Apply?

To be eligible to receive financial assistance from the CSE Trust Fund, an individual or business entity must be licensed by the CCC to operate a cannabis business in the Commonwealth of Massachusetts or a License applicant AND meet at least one of the three following criteria:

1. The individual or business entity is a CCC-certified Economic Empowerment Priority Applicant
2. The individual is a CCC-certified Social Equity Program Participant
3. The business entity is a Social Equity Business, which is defined as a cannabis business comprised of at least 51% (majority) ownership of individuals who are Social Equity Program Participants or who have been certified as meeting the CCC’s criteria for designation as an Economic Empowerment Priority Applicant, or both.

What Types of Financial Assistance Are Available?

Financial assistance will be provided in the form of grants or loans, which could include direct grants, recoverable grants, low-interest loans, forgivable loans, loan guarantees, or other forms of credit enhancement.  The EOED has sole discretion to decide what types of financial assistance will be made available.

Once selected to receive financial assistance, an individual or business entity must execute a binding contract with the EOED that includes terms addressing permitted uses of the funds, repayment, penalties if the recipient defaults or otherwise breaches the contract, and restrictions on the sale or transfer of certain types of “Restricted Assets.”

How Do I Apply?

Applicants must submit a complete application with supporting documentation through the EOED’s online grant application portal (Submittable). A link to the application portal is available here: Cannabis Social Equity Trust Fund - How to Apply.

When Can I Apply?

The EOED has regulatory authority to accept applications on a rolling basis or issue Request for Proposals (RFPs) at least once each year.

Economic Empowerment Priority Applicants and Social Equity Businesses that hold a provisional or final License issued by the CCC are currently eligible to submit applications for grants of up to $50,000 under the EOED’s Immediate Needs Grant Program through February 15, 2024, at 11:59 PM Eastern. 

Additional information about the Immediate Needs Grant Program is available here: Immediate Needs Grant Program - Notice of Funding Availability.

It is anticipated that additional financial assistance programs will be launched later in 2024.

Where Can I Find More Information About the CSE Trust Fund?

Additional information about the CSE Trust Fund is available here: Cannabis Social Equity Trust Fund - About the Trust Fund.

As the access to capital continues to be very limited, interested individuals and business entities that may be eligible should familiarize themselves with the regulatory criteria and application process for the CSE Trust Fund and take advantage of this unique opportunity offered by the Commonwealth of Massachusetts to increase equity within state’s regulated cannabis industry.   

Contact Us!

If you have any questions or would like to schedule a call to discuss the Cannabis Social Equity Trust Fund and how you might be able to obtain funding for your cannabis business, please contact David M. Ullian at d.ullian@vicentellp.com or 617-752-7148.