The City of Los Angeles’ Social Equity Program (SEP) Eligibility Verification Process opens today and will be open for 60 (sixty) days. Potential Social Equity Applicants MUST complete the SEP Applicant Eligibility Verification Process in order to be eligible to apply for SEP Priority Processing for Phase III Storefront Retail and Delivery licenses. All those that become verified during the SEP Eligibility Verification Process will be treated the same regardless of whether they are verified today or on day 59 of the Process, so don’t panic if you aren’t ready to submit proof of eligibility documentation today.
Phase III Storefront Retail Licenses Unlikely for Non-Equity Applicants Applying Individually
When it comes to storefront retail licenses, given the small number of licenses available (because of undue concentration limits), the City’s Social Equity Program which requires retail licenses to be processed at a 2:1 ratio (two social equity applications for every general application), and the fact that over 150 retail licenses were issued to non-equity applicants during Phase I, it is highly unlikely that any non-equity applicants will receive storefront retail licenses during Phase III. Therefore, if you want to get a storefront retail license in the City of Los Angeles, you either need to be a Verified Tier 1 or Tier 2 SEP Applicant or be partnered with one.
So, what is a Tier 1 or Tier 2 SEP applicant? Look no further, the City’s recently amended SEP applicant qualifications are outlined below.
TIER 1 Social Equity Applicants
A Tier 1 Social Equity Applicant is a person who meets the following criteria:
- Low Income and prior California Cannabis Arrest or Conviction; OR
- Low Income and a minimum of five years’ cumulative residency in a Disproportionately Impacted Area.
Additionally, a Tier 1 Social Equity Applicant must own at least 51% Equity Share in the licensed entity.
TIER 2 Social Equity Applicants
A Tier 2 Social Equity Applicant is a person who meets the following criteria:
- Low Income and a minimum of five years’ cumulative residency in a Disproportionately Impacted Area; OR
- A minimum of 10 years’ cumulative residency in a Disproportionately Impacted Area.
Additionally, a Tier 2 Social Equity Applicant must own at least 33.3% Equity Share in the licensed entity.
During the SEP Eligibility Verification Process, potential SEP Applicants must submit proof that they qualify as either a Tier 1 or Tier 2 Applicant. This means they must submit proof that they fulfill at least one of the criteria sets noted above. See the chart below for examples of simplest documentation that can be submitted to help prove the necessary criteria have been met. Please note that other evidence may be accepted as well.
During the SEP Eligibility Verification Process, potential SEP Applicants must submit proof that they qualify as either a Tier 1 or Tier 2 Applicant. This means they must submit proof that they fulfill at least one of the criteria sets noted above. See the chart below for examples of simplest documentation that can be submitted to help prove the necessary criteria have been met. Please note that other evidence may be accepted as well.
Low Income
- Tax returns showing an annual income of less than $45,644.
- Proof of six months of eligibility for programs related to being low income.
California Cannabis Arrest or Conviction
- Court minutes showing the conviction or arrest;
- Background check paperwork showing the conviction or arrest;
- Other court or law enforcement paperwork showing the arrest or conviction information.
Residency in a Disproportionately Impacted Area
- Utility bills showing the applicants name and the address that falls in the Disproportionately Impacted Area (at least one bill for each year required).
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If you would like help determining if you qualify as a Tier 1 or Tier 2 SEP Applicant, compiling proof of your qualifications, or completing the SEP Verification Process, please contact Rogoway Law Group today.
