BOSTON – Pot shop owners are calling on the state to cut the fees they have to pay cities and towns to start operations, arguing that they will have a minimal impact on police, fire and other community services.
The legislature’s Joint Cannabis Policy Committee heard statements from dozens of retailers and industry supporters Tuesday that local governments were charging excessive pay-to-play fees and refusing to justify the fees.
David Torrisi, president of the Commonwealth Dispensary Association, which represents marijuana retailers, said negotiations on so-called host agreements are “inherently one-sided, the impact fees are abused” and the cost of a marijuana business to the surrounding communities “negligible”. “
“I could argue that a dunkin ‘donuts store has more adverse effects than a marijuana store,” he said.
The state’s 2016 law legalizing marijuana allows adults 21 and older to own up to 10 ounces of weed, and it allows regulated cultivation and sale.
The law allows municipalities to impose excise duties on pot shops of up to 3% on retail sales. This is on top of a state excise tax of 10.75% on cannabis and a state sales tax of 6.25%.
In addition to these taxes, cities and municipalities can impose impact fees that are “reasonably related to the costs” of running a pot business, e.g. B. the occupation of additional police patrols. However, these fees may not exceed 3% of the company’s gross sales.
According to the law, these fees must be renegotiated by the municipalities every five years.
Some communities have added a “reopening” clause to the agreements that requires marijuana dealers to increase their payments when they give more money to other communities.
Industry officials say the long lines and traffic jams outside pharmacies that accompanied the opening of the first retail stores in late 2018 have long since subsided. Most businesses set their own security and do not rely on the local police.
Senator Diana DiZoglio, D-Methuen, has tabled a proposal that local governments should conduct annual reviews of the costs to their communities if they host pot businesses and reimburse pharmacies for impact fees if necessary.
If a municipality doesn’t conduct an audit, pharmacies can sue to get the money back.
Dizoglio says she has heard of marijuana companies that are not against paying fees but feel like the agreements are keeping them on a keg.
“They are concerned about what they see as a lack of transparency and accountability, including local authorities who are not documenting the impact,” she told the committee.
Andy Vargas MP, D-Haverhill, tabled a similar proposal in the House, which the committee is also considering.
Caroline Pineau, owner of Stem, a Haverhill cannabis company that sued the city over fees charged in the hosting agreement, said it had no impact on the city’s public safety but continues to be charged.
“I can tell you that after more than 12 months of operation I have not had any negative effects on Haverhill … and I have not yet had any documentation of the effects on Haverhill,” she said. “However, that hasn’t stopped the city from charging the full 3% impact fee.”
Pineau said that asking local officials for charges to be justified would ensure they were “proportionate to the cost”. She said the changes to the state’s pots law would also give cannabis operators “specific steps toward relief when local authorities fail to obey the law”.
The Massachusetts Municipal Association strongly opposes efforts to eliminate impact charges. She argues that the agreements are no different from contracts with developers and others to offset the increased cost of providing police, fire brigade, or other community services.
Christian M. Wade reports on the Massachusetts Statehouse for the North of Boston Media Group’s newspapers and websites. Email at [email protected]