Chart: Licensing bottlenecks hamper growth of Massachusetts MMJ program

By Eli McVey

Still reeling from a sluggish start statewide, Massachusetts’ medical marijuana program also is hindered by local-level licensing bottlenecks that have allowed just a handful of dispensaries to open to serve nearly 35,000 MMJ patients throughout the state.

According to data from the Massachusetts Executive Office of Health and Human Services, the state’s MMJ program has added more than 15,000 patients since January 2016. Yet only five additional dispensaries became operational over the same period.

That means a substantial number of patients who’ve received recommendations are unable to purchase MMJ, because many still don’t live near one of the state’s nine operating dispensaries.

In February 2017, for example, nearly 40,000 active certifications were issued by physicians, but about 14% of those patients did not register with the state – a necessary step in the process that allows someone with a recommendation to purchase MMJ.

As the number of operating dispensaries has increased, there has been a decline in the percentage of patients with active physician certifications who are not registered with the state. In early 2016, when just four dispensaries were open throughout Massachusetts, about 22% of patients with physician recommendations had not registered with the state.

So what’s keeping more dispensaries from opening?

In addition to facing a lengthy application process at the state level, a dispensary is required to receive a “letter of non-opposition” from the municipality in which it wishes to operate. Without local approval, a dispensary cannot open, a stipulation many towns are using to ward off unwanted MMJ outlets.

Some municipalities add even another step to the process of acquiring a non-opposition letter. Because dispensaries operate as nonprofits and therefore do not pay local taxes, some towns require “community hosting agreements.” These typically mandate that a dispensary pay a sizable fee or agree to share a portion of revenue with the town before a letter is granted.

Local authorities are trying to further leverage this control by attempting to strike lucrative “pay-to-play” deals that can cost dispensaries, in some cases, hundreds of thousands of dollars.

As of February 2017, nine dispensaries were fully operational, three had final certificates but hadn’t begun selling, and 87 had received provisional certificates but were still in the inspection phase. An additional 119 applicants were stuck in earlier stages of the application process.

It’s unclear how many of these dispensaries will receive local approval and eventually open their doors. And with recreational marijuana businesses expected to open in Massachusetts by early 2018, the future is very uncertain for the overwhelming majority of MMJ businesses still waiting to receive a license.

Eli McVey can be reached at [email protected]

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