What to know about the 2 marijuana reform bills from the Mass Legislature.
Both houses of the Massachusetts Legislature have now passed bills to change the state’s marijuana law to help diversify the local industry, pave the way for so-called coffee shops in cannabis and other issues that advocates and regulators say have created obstacles and concerns in the booming $3 market. billion industry.
House lawmakers on Wednesday backed a proposal to channel money from the state’s marijuana excise tax into industry funding opportunities for residents of communities disproportionately affected by the pandemic. war on drugs, the State House Press Service reports.
The state has seen relatively few companies launch with ties to the Cannabis Control Commission’s social equity program or economic empowerment entrepreneurs.
According to Press service.
“Since the adoption of legal recreational cannabis, the establishment and growth of the legal industry in the Commonwealth has been, for the most part, successful, leading to hundreds of new businesses, thousands of new jobs and the creating new sources of revenue for the Commonwealth and its municipalities through this new and innovative industry,” said Worcester State Representative Dan Donahue, Chairman of the House Cannabis Policy Committee.
“It is, however, time to review the original legislation to clarify the intent of (the) legislation and to work to ensure that we continue to remove barriers to entry into this unique industry for the communities that are so disproportionately impacted and impacted by marijuana prohibition,” Donahue added.
State lawmakers are also considering how to allow cities and towns to license marijuana establishments where customers can consume cannabis products on-site and how to improve oversight of host community agreements.
The deals, the agreements between potential companies and municipalities that are needed to ensure the former can operate legally, have raised concerns about the power local authorities are ceding as gatekeepers to the still relatively new industry.
In September, for example, former Fall River mayor Jasiel Correia was convicted of extorting hundreds of thousands of dollars from marijuana entrepreneurs seeking to open stores in the city in exchange for community deals. of reception.
Here’s what to know about the two bills as House and Senate officials hammer out a final version:
Here’s what the Senate bill proposes
Last month, the state Senate passed its own marijuana industry reform bill, which proponents say addresses some of the most significant and outstanding issues lingering five years after the enactment of the legal state market.
According to Press service.
The bill received unanimous support after gaining approval from the Cannabis Policy Committee.
Senator Sonia Chang-Díaz, Senate committee chair and current gubernatorial candidate, said the proposal was intended to address “long-standing issues with long-identified solutions.” Press service reported.
“If you talk to advocates, to policy experts, to the Cannabis Control Commission, you’ll find near-universal agreement,” Chang-Díaz said. “They will tell you… the costs of entering the industry are too high and there is a severe lack of access to capital in this industry. It typically takes $1-1.5 million in cash to open a new cannabis retail store or $3-5 million for a manufacturing plant.
“It’s no surprise that despite our best intentions, the industry has remained overwhelmingly white and overwhelmingly in already wealthy hands,” she added.
The Senate bill seeks to rectify this by creating grants and loans – including repayable, interest-free loans – for participants in the CCC’s social equity program and for priority applicants for economic empowerment.
The money would go through the Cannabis Social Equity Trust Fund, which would get 10% of the money from the Marijuana Regulation Fund, the state account that pays for marijuana excise tax and other fees.
Under this system, the trust fund would have received approximately $11.24 million in fiscal year 2021 alone, according to the news service. Lawmakers have estimated the account could receive an influx of between $15 million and $18 million in fiscal year 2023.
Additionally, the bill would give cities and towns the ability to allow marijuana cafes in their municipalities by local ordinance. Cities and towns could also use the local referendum option already available to approve or reject the right to open such an establishment within their borders.
“Allowing this to go through the local political process, this decision making to go through the local political process in the same way as all other municipal ordinances, will both save the municipal resources needed to execute a ballot issue and to avoid delays resulting from having to wait months or years until the next election cycle in some cases, while maintaining accountability to voters,” Chang-Díaz said.
The proposal would also ask the CCC to review and approve host community agreements and “regulate and enforce” their terms, according to the Press service.
With regard to these conditions, the bill also defines more clearly what local authorities can ask of potential companies under these agreements and obliges the CCC to develop a model agreement that municipalities can use as a model. Cities can also waive the requirement for host community agreements under the bill.
“By clarifying the requirements of host community agreements, making financial investments to increase social equity, and enabling the full implementation of the cannabis industry by allowing social consumption permission, I am convinced that this legislation contributes to the continued growth of a competitive and fair market. commercial marijuana industry here in the Commonwealth of Massachusetts,” Senate Ways and Means Committee Chairman Michael Rodrigues said last month.
Here’s what the House bill proposes
On Wednesday, House lawmakers nearly unanimously passed their own bill focused on similar challenges in the industry.
The sweeping proposal passed by a 153-2 vote, with negative votes coming from Rep. Jeff Turco, a Winthrop Democrat, and Rep. Marc Lombardo, a Billerica Republican, according to the news service.
House Speaker Ron Mariano hailed the bill as an effort “to advance a fair cannabis industry” in Massachusetts.
“This bill provides capital to minority-owned marijuana businesses to ensure that those disproportionately harmed by marijuana prohibition can participate in this new industry,” Mariano said in a statement. post on Twitter. “It also expedites the expungement process for those seeking to expunge a criminal record for offenses that have been decriminalized, clarifies the approval process for social consumption sites, and grants cannabis businesses the same tax benefits as others. companies.”
Notably, the House bill seeks to direct 20% of the money raised each year through marijuana taxes and fees into what would be the new Social Equity Trust Fund, according to the Press service. The fund would provide grants and loans to entrepreneurs whose demographics are disproportionately impacted by drug prohibition laws.
In essence, the model is similar to the Senate proposal, but the House version would channel more money into encouraging diversity in the industry.
In fiscal year 2021, for example, the trust fund would have received about $22.3 million under the bill, the Press service reports.
“Business owners, they’ll tell you they need about $1 million to innovate realistically to get into this industry,” said Boston State Rep. Chynah Tyler, who has tabled the amendment to raise the amount to 20%. “So if we really want to bring social equity to this industry, if we really want to do what we say by putting our money where our mouth is, we need to invest real dollars.”
Like the Senate bill, the House bill clarifies what can be included in a host community agreement, grants the CCC the power to review and approve such agreements, and enshrines in law the right for towns and villages to waive the requirements of these agreements.
Under the House bill, cities and towns can also hold a referendum vote to determine whether they will allow marijuana cafes to open or by the vote of a public body, the Press service reports.
“Establishing social consumption sites is important because many residents don’t have a place where they can legally consume cannabis products,” Donahue said. “This problem disproportionately affects tenants, especially those in social housing and medical patients. Additionally, social consumer businesses tend to have lower start-up costs than other license types. »
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