Massachusetts asks municipalities to curb demands on cannabis firms

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Massachusetts marijuana regulators urged city and town officials to keep within the boundaries of state law when negotiating local agreements with recreational marijuana businesses.

The Cannabis Control Commission cited “anecdotal” evidence of municipalities putting excessive financial demands on companies wishing to locate within their communities, further slowing the already delayed rollout of the state’s voter-approved recreational marijuana law.

Retail marijuana stores had been expected to begin opening July 1 in Massachusetts, but none have so far and it could be at least several more weeks before the first ones are operational.

Under the law, cities and towns may charge cannabis businesses for reasonably anticipated municipal costs related to such things as increased traffic or police protection.

But host community agreements (HCAs), as they are called, are not allowed to assess fees that exceed 3% of the total annual revenues of the business, and not for any longer than five years.

Prospective marijuana businesses are required to secure HCAs before they apply for a license from the state.

In addition to the maximum 3% fee in host community agreements, municipalities under the law can collect taxes of up to 3% on recreational marijuana sales.

State Rep. Mark Cusack of Braintree and Sen. Patricia Jehlen of Somerville, Democrats who chair the Legislature’s Marijuana Policy Committee, recently sent a letter to regulators asking them to get tougher on cities and towns that overreach in negotiating host agreements.

The commission, which did not single out any community, also questioned the extent of legal authority it had over the agreements.

It also issued two more provisional retail recreational licenses to operators of medical marijuana dispensaries and gave local officials two weeks to respond to the concerns raised at the meeting.

Associated Press