REFERENCE OR WATCH:
WATCH THE LIVE STREAM VIDEO: PART 1, PART 2, PART 3
New Public Documents on Cannabis Control Commission Website:
- API Agreement
- Guidance on Marijuana Establishment Agent Registration
- Applicants that have SUBMITTED ALL 4 PACKETS BY COUNTY as of AUGUST 9, 2018
- Executive Summary – Pharmacannis Massachusetts, Inc. – MRN281252
- Executive Summary – M3 Ventures, Inc. – MCN281446
- Executive Summary – M3 Ventures, Inc. – MPN281346
- Executive Summary – M3 Ventures, Inc. – MRN281290
- Executive Summary – I.N.S.A., Inc. – MRN281680
- Executive Summary – I.N.S.A., Inc. – MCN281268
- Executive Summary – I.N.S.A., Inc. – MPN281426
- Guidance on Host Community Agreements
AGENDA
A) CHAIRMAN UPDATES
APPROVAL OF APRIL 18 + JULY 26 MEETING MINUTES
B) UPDATES FROM EXECUTIVE DIRECTOR
- STAFFING
- LICENSE APPLICATIONS STATUS
C) COMMISSION DISCUSSION & VOTES
- a) Guidance for Farmers
- b) Guidance on Marijuana Establishment Agent Registration
- c) Public Awareness Campaign
- d) Host Community Agreement Guidance—Discussion of Public Comment
- e) Equity-focused Municipal Guidance—Discussion of Public Comment
D) STAFF RECOMMENDATIONS ON COMPLETED LICENSING APPLICATIONS
- a. Pharmacannis Massachusetts, Inc. (#MRN281252), Retail
- b. M3 Ventures, Inc. (# MCN281446), Tier 2/Indoor-Cultivation
- c. M3 Ventures, Inc. (# MRN281290), Retail
- d. M3 Ventures, Inc. (# MPN281346), Product Manufacturer
- e. I.N.S.A., Inc. (# MCN281268), Tier 7/Indoor-Cultivation
- f. I.N.S.A., Inc. (# MPN281426), Product Manufacturer
- g. I.N.S.A., Inc. (# MRN281680), Retail
E.) NEXT MEETING
- Thursday, August 23rd 1:00 PM
- Massachusetts Gaming Commission
- 101 Federal Street 12th Floor Boston, MA
A) CHAIRMAN UPDATES
- APPROVAL OF JULY 12 MEETING MINUTES
B) UPDATES FROM EXECUTIVE DIRECTOR: Shawn Collins
- NEW CCC STAFF
Director of Investigations – Patrick Beyea, former Senior Senior Investor for New York State Police
- LICENSE APPLICATIONS
[12] Provisional Licenses
[95] Applicants SUBMITTED ALL 4 PACKERS UNDER REVIEW
(see below, right column is change from last meeting)
These 95 applications represent 52 separate entities.
FLOWCHART FOR APPLICATION REVIEW (see below)
STATUS of 95 SUBMITTED APPLICATIONS (see below)
TOTAL NUMBER OF LICENSE APPLICATIONS that have submitted ALL 4 PACKETS by county as of July 12, 2018 (see below)
C) COMMISSION DISCUSSION & VOTES
- a) Guidance for Farmers
Doyle: This is essentially a consolidation and summarization of regulations that pertain to farmers and cultivators as well as answers to frequently asked questions and easy references to particular issues.
McBride: This should be helpful to town managers and municipalities seeking guidance.
Title: My suggestion would be to include a waiver form for alternate security provisions.
*Motion passed*
Collins: This document was created to assist Marijuana Establishments and prospective Marijuana Establishment agents with the registration process required under 935 CMR 500.030. It does not apply to registration for laboratory establishment agents under 935 CMR 500.029.
Flanagan: Under Chapter 55, the DPH under the consultation of the CCC is mandated to establish a science-based Public Awareness Campaign on safe and responsible marijuana consumption with the goal of decreasing the youth-usage rate.
Revenue generated through the sale of adult-use marijuana shall be allocated to fund the program.
Sinclair:
Phase 1 is an online campaign to educate youth about marijuana-use with the goal of decreasing the youth-usage rate done in collaboration with the DPH commencing Monday, August 13th. A video of the first ad can be viewed here.
Phase 2 is a fully integrated marketing campaign on youth prevention and responsible adult-use. Later phases will address the dangers of manufacturing marijuana products at home and other identified education needs.
The Public Education Campaign is informed by a representative pre-survey exploring the knowledge, attitudes, and practices around cannabis and the new law from Massachusetts residents age 21+ and 18 focused groups that took place in 3 locations, including 1 urban, 1 suburban, and 1 rural.
The campaigns effectiveness will be measured in a post-survey reassessing the knowledge, attitudes, and practices around cannabis and the new law in a comparable separate Massachusetts sampling.
These tactics will target relevant websites and major social media channels such as Facebook, Twitter, and Instagram, through the use of Google ad’s and social media marketing.
Out-of-home, billboards, transit, ect will support long-scale effectiveness of the campaign targeting large cities including prospective neighborhoods that may intend on hosting adult-use marijuana establishments.
Printed materials and MoreAboutMJ.com will provide useful information such as tips for having discussions about marijuana with children, facts about risks of underage cannabis consumption, and crucial details about the law that help consumers remain complaint.
McBride: Is there a component of the campaign to focus on schools?
Flanagan: Right now the goal is youth prevention and to give parents the tools. Eventually with the revenue allocation from adult-use sales that is a possibility.
- d) Draft Guidance on Host Community Agreements: Discussion of Public Comments
McBride: We received comments of every variety: from the industry, municipalities, and residents with general interest of the roll-out of the industry.
Agreements are going to vary from municipality to municipality, it shouldn’t be a cookie-cutter agreement. The impacts are going to be different depending on what types of marijuana establishments they are, the makeup and geography of the municipality ect.
A flat fee is okay, but you’re still limited to 3% with Host Community Agreements.
These guidelines aren’t intended to be a ceiling, they’re is intended to be a floor. This isn’t an exhaustive or exclusive list.
The statue requires for the conditions to be spelled out in the Host Community Agreement. Any amount that is not a community impact fee, if it’s an additional condition under the HCA, it needs to follow thru with legal requirements we set forth about what “fees” are.
There must be a reasonable relation, it needs to be proportional between the cost and the impact.
The Community Impact Fee is limited to 5 years. At or before the conclusion of the HCA, parties may negotiate a new optional fee at the end of the term.
Title: In the law, it says the Host Community Agreement shall include all stipulations of responsibilities between the Host Community and the Marijuana Establishment
Hoffman: Towns and cities are charging for expert advice in terms of lawyers and consultants, is that a legitimate cost to be covered by the HCA?
Doyle: That is consistent with other types of permits. It can be difficult for a municipality with a constrained legal budget to engage in an extended negotiation process. It would be helpful for that to be funded so that they can engage rather than ban.
Hoffman: My concern is with the small businesses as they are unlikely to have those resources.
Doyle: Attorneys with this sort of experience would be an excellent addition to our RFQ. People familiar with appearing before municipalities, we encourage them to apply for our technical assistance programs before September 7th.
Hoffman: If the law says you can’t exceed 3% with a flat fee and in retrospect it turns out to exceed 3%, in my mind that is a violation. Isn’t that contrary to the spirit we’re talking about?
Title: I trust the contractors to be intelligent enough to negotiate a a flat fee that does not exceed the permissible amount.
This is an issue that is not going away, we should evaluate what’s happening today and we should re-visit it.
I believe the vast majority of municipalities are acting in good faith, trying to implement what their constituents want, but there are other municipalities going beyond what’s in our guidance.
The essence of this motion is that the applicants HCA will reviewed for compliance with the law before a final license can be issued:
“The commission will require applicants to submit signed HCA’s and will review them as past of its licensing process. The scope of review will be to ensure that licenses are compliant with MGL including that the community impact fee is:
1. “Reasonably related to the costs imposed upon the municipality by the operation of the Marijuana Establishment or medical marijuana treatment center.”
2. Not more than 3% of the gross annual sales of the Marijuana Establishment.
3. The community impact fee is limited to a term of 5 years.
4. The HCA includes all stipulations of responsibility between the municipality and Marijuana Establishment
The Commission may conduct inspection and review all documents required upon completion of a final license.
Doyle: My concern is we are not specifying the process, it may hurt the applicant in the end. My other concern is whether municipalities will be open to allowing applicants to go forward without these stipulations.
Title: If you’re an applicant that is making a payment that you are not lawfully allowed to make in exchange for some special treatment I think that is a problem.
Secondly, I don’t think it’s our call as to whether or not we’re hurting the applicant. If that was the issue then we shouldn’t ask for a lease because there are many people who can’t afford a lease even though they need one to apply.
In terms of timing, we need to address this now. If we’re to issue a final license without inspecting the HCA and we decide later to change our mind’s we’ll be treating applicants differently.
McBride: Denial of the license hurts the applicant but also because it opens us up to legal processes and I don’t particularly want us to be sued. We would also be adding an additional bureaucratic process on top of an already slow process.
There’s no explicit authorization in the law for us to perform a review of HCA’s, I question our legal authority.
Hoffman: Before we issue a final license we should decide whether on not we’re going to interject.
We have asked for a voluntary of submission of HCA’s through our municipal surveys. I don’t believe it is possible to require that without a change in the regulations
Title: Nobody is suggesting that we have any right to interfere with a contract between an applicant and the municipality. What we have the right to do is to ensure that they have a legal HCA before we issue a license.
I think we’ve seen a lot of evidence. We’ve heard applicants say things like 4%. We’ve seen things like 3% plus a $100,000 flat fee.
Instead of throwing our hands up and saying we did all we could to help [small businesses], we need to look where we are today, re-evaluate, take public comment, we have a complex challenging conversation, and then we make a decision.
Flanagan: I think we’ve done a lot of work specifically around the little guy & I’ll continue to fight for the little guy, but they’re not gonna make a town as much money as the big guy ever will. I think they’re going to get lost in this regardless of what we do & that’s part of my fear.
My concern is if we start collecting HCA’s and start looking at what’s in those agreements… everyone’s needs are different, so what are we comparing?
We’ve got to figure out what we we want our end result to be before we go to the staff and say start going through these HCA’s.
Hoffman: I feel confident in our staff to not look at individual monetary numbers, but if there’s a justification for the costs incurred and is it documented.
McBride: That information is likely not going to be included in an HCA. It has to reflect the conditions and stipulations of responsibility, but the particularly specific pieces are parts that come into play during the course of a negotiation but may not necessarily included.
Hoffman: If the law says it has to be proportionate to the actual costs, if this were litigated how would a court determine whether it was indeed proportional to the costs incurred?
McBride: There would be discovery. That would be done during the course of the lawsuit.
Hoffman: I’m not sure I agree with Commissioner Title’s suggestion but I do agree with her that we can’t just throw our hands up and say we cant do anything here. I’m open to other suggestions, what can we do?
McBride: The proposal is to go look at the documents at an applicants site [during their final inspection].
Hoffman: I agree we can’t tell a municipality what to do, we can’t nullify a contract decided between 2 parties. I really want to do two things, I want more data on what how widespread this problem is.
I agree with your assessment, most cities and towns are operating in good faith but there are some exceptions
Title: If we allow an exception one time, if it doesn’t apply to that municipality why would the others follow the law?
Hoffman: I agree, it’s not so much the number of times, it’s what’s going on. I agree one time is one too many. I don’t know if we can change the outcome but at least we will know how the problem will go.
The second thing is, the Hawthorne Effect works. If people know what they’re doing will be exposed to the public, they will think twice, maybe they won’t change their behavior but maybe they will and I don’t see any cost not to try.
Flanagan: You say you want data. Isn’t that what the two-week public comment period was for? We only got 36 responses. How much more are we going to do as a Commission to get more feedback?
Hoffman: I’m not looking for feedback, I’m looking for contracts. It works simultaneously with exposing this to fresh air.
McBride: We have limited authority. If we get this information, what are we doing?
Hoffman: We know what our limitations are currently. We have the option of going to the legislature to modify the legislation if it’s a persistent and important issue.
The second is we have the option of changing our regulations to address the problem at the appropriate time.
I agree that right now we have very limited options, but if we get more data and study this issue, I think we have, longer term, a lot of options we can move forward with.
Title: If we have an applicant who goes beyond what’s in the guidance, either we deny it during the meeting or we have our staff say to them the agreement is not in compliance, come back with another agreement that complies. What that sets is a path forward where every HCA then has to meet the standards of the law.
The other thing is what about all the prospective applicants without HCA’s who we’re unable to agree to those conditions and weren’t able to come before us? We have to think about them too.
I would suggest on the question of what the staff process might be and how long it might take is to take an opinion from the staff and revisit the conversation.
Hoffman: I agree and we should address all of the issues raised in terms of resources, timing, and explicitly recognize that any intervention we do have, that there are things we can and cannot do. I suggest a communication strategy as part of the recommendation to the staff to address that concern.
Collins: At what stage would we be inspecting the HCA?
Hoffman: The only way we can enforce our ability to review is during the final inspection process.
McBride: We would leave it up to the Executive Director, Chief of Investigations & Enforcement, and the licensing staff to determine what that process would look like, how long it would take. If we’re going to do this, we need to do it before we issue a final license.
Title: I don’t think we need to overstate the recommendation which is simply to check for documentation of costs, the percentage of gross sales or a flat fee with a limit of 3% of gross sales, a term of 5 years, and a sentence that says “this includes all stipulations of responsibilities between the Host Community and the Marijuana Establishment.”
Doyle: I don’t think it’s simple as that. In the statute, a Community Impact Fee is one thing, but not the only thing that can occasion monetary transfers between the marijuana establishment and the municipality which is where this gets complex.
That’s where it may get difficult for staff to analyze and determine whether the agreements are in compliance.
Hoffman: I’m confident the staff can come up with something to address those complexities. We’ll push back on the Sept 6th agenda if that’s okay with the staff.
Collins: Yes, we can address this next meeting.
*Motion passed*
- e) Draft Guidance on Local Equity: Discussion of Public Comments
Title: A recommendation from EON (Equitable Opportunities Now): “We encourage lowering community impact fees for economic empowerment applicants”
A recommendation from the MMA (Mass Municipal Association): “We discourage municipalities from enacting any separation requirements”
A recommendation from EON, Elevate NE: “We recommend that municipalities alternate signing HCA’s with Economic Empowerment applicants and non- Economic Empowerment applicants.
Doyle: Could we make sure to list the studies we’re referring to?
Title: Yes that’s fair.
Doyle: I’m having discomfort with two points, discouraging municipalities from enacting any separation requirements and recommending alternate signing of HCA’s with Economic Empowerment applicants.
Title: If you exacerbate the real estate by suggesting an 800 ft buffer from another marijuana establishment that just further reduces the number of properties that are available. That as a general matter discourages smaller applicants.
Flanagan: I have a concern with including studies in our guidances. We can probably find researchers that will find studies to go against out claims. My recommendation is that we don’t include studies but if others are supportive of that, I’m willing to vote against it on my own.
Title: We are a very capable agency, we have a resource department, we have a research agenda. If we cant put forth two paragraphs that characterizes what the research says on an issue I think that is a much bigger problem.
McBride: I suggest if we agree to keep the studies in our guidances that these be living, breathing documents. We can add relevant studies as they become available.
*Motion passed*
D) STAFF RECOMMENDATIONS ON 7 COMPLETED LICENSE APPLICATIONS
Pharmacannis Massachusetts, Inc. #MRN281252 – Retail
M3 Ventures, Inc. #MCN281446 – Tier 2/Indoor-Cultivation
M3 Ventures, Inc. #MRN281290 – Retail
M3 Ventures, Inc. #MPN281346 – Product Manufacturer
I.N.S.A., Inc. #MCN281268 – Tier 7/Indoor-Cultivation
I.N.S.A., Inc. #MPN281426 – Product Manufacturer
I.N.S.A., Inc. #MRN281680 – Retail
E.) NEXT MEETING
- Thursday, August 23rd 1:00 PM
- Massachusetts Gaming Commission
- 101 Federal Street 12th Floor Boston, MA
REFERENCE OR WATCH: