The Cannabis Business Assistance Loan/Grant Fund (CBAF) is a financing resource operated by the Maryland Department of Commerce (Commerce), to provide grants and loans for small businesses, including small, minority-owned and small women-owned businesses entering the adult-use cannabis industry. CBAF may also provide grants to Historically Black Colleges and Universities (HBCUs) for cannabis-related programs and to business development organizations, including incubators, to train and assist small businesses, including minority and women business owners and entrepreneurs, seeking to become licensed to participate in the adult-use cannabis industry.
Eligible Use of Funds
- Grants or loans to small businesses, including small, minority–owned or small women–owned businesses, for:
- License application assistance for participation in the adult–use cannabis industry;
- Assistance with the operating or capital expenses of a business participating in the adult–use cannabis industry; or
- Targeted training to support participation in the adult–use cannabis industry
- Grants to historically black colleges and universities for cannabis–related programs and to business development organizations, including incubators, to train and assist small, minority, and women business owners and entrepreneurs seeking to become licensed to participate in the adult–use cannabis industry.
Current Funding Opportunity - Social Equity Conditional Licensee Grant
Purpose: Provide direct capital assistance to Social Equity Applicants awarded a conditional Maryland Cannabis License. This Conditional Grant Program is structured with milestone-based tranches for conditional licensees who meet the Adequate Capital Requirement (ACR) established by Maryland Cannabis Administration (MCA). The ACR is demonstrated through MCA’s supplemental application. It is also structured with milestones that guide the licensees towards becoming operational and securing the standard adult-use cannabis license.
This funding is intended to enhance the licensee’s position attracting other funding resources as they arrange the capital needed to become operational.
Background: The State of Maryland, facilitated through the Maryland Cannabis Administration (MCA), awarded 205 conditional Social Equity Cannabis Licenses by way of lotteries held in the first half of 2024. After evaluation by MCA, lottery winners initially received a conditional license. A conditional license is valid for 18 months commencing on the day of the conditional license award. During the 18-month conditional license period, MCA will verify all information provided in the license application, including ownership and control of the business, and will conduct health, safety, and security inspections.
Structured as a Conditional Grant, eligible applicants may apply for grant disbursements in four (4) tranches with a maximum amount for each license type. Maximum disbursement amounts are calculated as match rates of Adequate Capital Requirement (ACR). Adequate Capital Requirement is a license milestone mandated by MCA at the six-month mark of being issued a conditional license, and demonstrated through the supplemental application. ACR amounts were determined by MCA based on estimated start-up costs for each license type to ensure the licensee is demonstrating a good faith effort towards securing the necessary capital needed and making adequate progress towards becoming operational.
Total funding per license, inclusive of all four tranches, is determined by license type as shown in the following chart.
Milestone-Based Conditional Grant Funding
Maximum Elgible Grant Amounts
| Dispensary
| Processor
| Grower/Cultivator
|
Standard
| Up to $131,250
| Up to $183,750 | Up to $525,000
|
Micro
| Up to $43,750
| Up to $61,250
| Up to $175,000
|
Grants will be distributed over four tranches based upon the demonstrated achievement of certain milestones. Each disbursement tranche requires the applicant to provide specific documentation, including proof of payment when applicable, verifying established milestones were achieved. Upon its verification, Commerce will approve the grant tranche disbursement for that applicant. If an applicant does not fully verify expenses or meet milestones for a particular tranche, the tranche disbursement will be declined, or it may be reduced. If an applicant meets some but not all of a tranche’s milestone requirements, partial disbursements may be considered at the discretion of Commerce.
ELIGIBILITY CRITERIA
To be eligible to register for the Social Equity Conditional License Grant, your business must meet and maintain all of the following requirements:
Standard and Micro:
- Meet or exceed the minimum Adequate Capital Requirement determined by the MCA.
- Be an existing business in Good Standing with the State of Maryland.
- Small Business Qualification - Applicant must be a small business, defined as an entity with 0-50 employees per license.
- Entity holds a Maryland Social Equity Cannabis Business Conditional License and the conditional licensee meets all requirements for licensing codified in Title 36 of the Alcoholic Beverages and Cannabis Article, and COMAR 14.17.
- Personal Net Worth Qualification - The business must be at least 51% owned by individuals whose personal net worth does not exceed $1.7 million. For the purposes of this program, net worth is defined as: the value of assets of an individual remaining after total liabilities are deducted including the individual's assets held jointly or as community property with the individual's spouse. Net worth does not include:
- The individuals' ownership interest in the applicant
- The individual's equity in the individual's primary place or residence; or
- The cash value of any qualified retirement savings plans or individual retirement accounts.
TRANCHE DISBURSEMENTS
Grant proceeds will be disbursed incrementally based on the grantee’s demonstrated ability achieving certain milestones shown in
this chart.
Examples of eligible expenses and qualifying evidence can be found
here. Take note: Invoices, receipts and supporting documentation submitted for review must be in the name of the business entity for expenses incurred between award of conditional license and conversion to a standard license. Proof of payment must accompany eligible verification. Proof of payment may include copies of a cancelled check, credit card statement, payment app statement or bank statement.
APPLICATION PROCESS
The application portal opened on June 3, 2025.
Applicants for the Social Equity Conditional License Grant need to register for access to the application portal with the Department of Commerce. It is encouraged to register in the application portal prior to submitting a request for Tranche #1 funding. This will help streamline Tranche funding requests.
Required Application Documents:
For applications to be considered, the information listed below must be provided. If necessary, applicants are encouraged to work with their advisor(s) in completing the application. Incomplete applications cannot be considered.
Prior to registering in the portal, applicants should have the following items readily available:
- Lottery number assigned by the MCA.
- Copy of the Maryland Social Equity Cannabis Business Conditional License Letter issued by MCA with the date of issuance clearly noted.
- A list of owners meeting the personal net worth qualification and the percentage of ownership for each of those qualifying individuals. Each of those individuals are required to submit a Schedule of Personal Net Worth with this application. Tips on how to complete the Personal Net Worth Template can be found here.
- Completed W9. Instruction on how to complete the W9 form [link to instructions].
- Evidence of Good Standing with the State - Good Standing can be determined on the Maryland Business Express website. A screenshot of the results will suffice, a formal certificate of good standing is not required.
- Copies of invoices detailing services rendered and proof of payment for eligible expenses (necessary for Tranches 2, 3 and 4).
***Incomplete applications cannot be processed.
There are no fees or costs to apply for a grant from the Fund. However, please note that grants are taxable.
Grants will be provided to applicants upon approval. Grantees are subject to random audit for compliance with the intended purpose of the grant. Applicants or grantees who do not comply with the intended purpose of a grant are subject to repayment of the grant in full.
Further, MCA has the right to request information from grantees and will use that right to request information related to expenditures of CBAF funds, including the right to subpoena records from third-party vendors and service providers of grantees to evaluate whether grantees are being charged fees, premiums or surcharges that specifically and disproportionately burden cannabis businesses. Commerce and MCA may share information between agencies regarding applicants and applications.
Resources for Cannabis Businesses
CONTACT
Questions about the Cannabis Business Assistance Fund should be directed to cannabis.financing@maryland.gov. A member of the Commerce team will respond to your inquiry in a timely manner.
Questions about the Cannabis Licensing application should be directed to policy.mmcc@maryland.gov.
Questions regarding technical assistance available for Social Equity Conditional Licensees should be directed to the info.ose@maryland.gov.
