Grow, Gift, Repair

HCA reform bill passes house!

If the bill is passed by the Senate and signed into law by Governor Charlie Baker, it would give the state Cannabis Control Commission authority to regulate host community agreements, invalidating provisions that violate the limits. The agency in 2018 said it lacked clear legal power over the deals, and so far has simply verified that every license applicant has signed one. But in January 2019, amid growing evidence of abuses, the commission voted to formally request that the Legislature grant it oversight of the contents of the contracts.

The bill passed by the House would also make clear that any “monetary payments, in-kind contributions, and charitable contributions” count toward the 3 percent cap, and that the five-year term begins when the business opens, not earlier. Other financial obligations that factor into local permitting — explicitly or implicitly — would not be enforceable. The measure would further allow local officials to waive the host community agreement requirement altogether.

“It’s come to light that some host community agreements impose financial obligations that go beyond the 3 percent,” Rogers said on the House floor. “This law makes clear that that is not permissible.”

Municipalities have long insisted the current law allows cities and towns to charge fees beyond the 3 percent cap and require marijuana companies to make charitable donations in exchange for local permits.

The powerful Massachusetts Municipal Association lobbied strenuously against the bill. The group’s executive director, Geoff Beckwith, called it “an overreach that would unwisely interfere with local authority” in a letter to legislators, and accused marijuana industry lobbyists of seeking to “flatten the landscape and remove municipal discretion and flexibility in the negotiation process.” He said other factors, such as “a lack of business and retail experience” and difficulty obtaining capital, are the real reasons smaller, more diverse marijuana outfits have struggled to win local approval.

However, it appears such concerns were outweighed by other pressures, including the federal investigation by US Attorney Andrew Lelling, a related scandal over bribes allegedly paid by marijuana companies to the former mayor of Fall River, and press coverage of local officials seeking money from marijuana firms for seemingly unrelated matters — such as a requirement in Salem that operators pay an additional 1 percent of revenue annually to fund a feasibility study on a proposed shuttle bus and give $25,000 a year to local charities.

It is unclear how the bill would affect the hundreds of host community agreements already signed across the state.