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With Speaker Mariano’s backing, Mass. Legislature poised to advance marijuana reforms

By Dan Adams | Jan 30, 2022

Massachusetts legislators are poised to advance a number of significant changes to the state’s marijuana laws, which despite widespread calls for reform have remained largely untouched since 2017.

Lawmakers and their aides said they expected the Legislature’s joint committee on cannabis policy to approve three bills by the end of Friday. And perhaps more importantly, House Speaker Ron Mariano said he supports the measures, significantly boosting their chances of passage.

While the sweeping legislation is unlikely to have any immediate impact on marijuana consumers and medical patients, it would reshape the industry in a number of ways, such as fixing a glitch in the current law that has prevented cities and towns from volunteering to host “social consumption” facilities, or cannabis cafes.

It would also crack down on municipalities collecting excessive “impact fees” from local cannabis companies; the House passed a similar measure in February 2020, but the Senate did not take it up before the pandemic. The legislation would further designate a slice of pot tax revenue to helping more economically disadvantaged entrepreneurs enter the legal industry — an unfulfilled promise of the state’s legalization law that followed decades of racially disproportionate arrests for marijuana.

“To address ongoing concerns that have become more pronounced with the growth of this new industry, the House will once again take up legislation this session to fix the host community agreement process and clarify community impact fee payments,” Mariano said in a statement to the Globe. “If passed into law, [this bill] will help our cannabis industry thrive and allow equitable opportunities to those disproportionately impacted by the systemic racism of historic drug policy, including the criminalization of cannabis.”

Mariano has also directed Rep. Dan Donohue, co-chair of the cannabis committee, to work with joint judiciary committee co-chair Rep. Michael Day on reforms to the state’s system of sealing and expunging old criminal records, especially marijuana-related charges, the Speaker’s office said.

A Globe review in November found that few former defendants have succeeded in having their records hidden or wiped clean, despite a 2018 law meant to expand access to the process.

Senate President Karen Spilka was less committal, but her office said in a statement she was “pleased” the bills were up for approval by the cannabis committee and would review them. In November, Spilka said her marijuana policy priorities were “host community agreements, social equity, and automatic expungement of eligible offenses related to cannabis,” precisely the same issues expected to be approved by the cannabis committee.

The legislation also aligns with the priorities of advocates and state regulators.

Last week, the state Cannabis Control Commission voted to request legislative action on social consumption. The agency previously drafted regulations for the facilities in 2019; if approved, they would roll out slowly in a handful of volunteer municipalities and be subject to tight regulations around ventilation and over-serving.

The idea for such lounges or cannabis cafes was included in both the 2016 ballot initiative legalizing marijuana and a 2017 rewrite by lawmakers, but Secretary of State William Galvin has for years essentially blocked cities and towns from offering to host such businesses, saying the statute erroneously refers to a nonexistent local voting mechanism.

Critics have long contended that the lack of licensed cannabis bars — along with a ban on public marijuana consumption — leaves renters, tourists, and public housing residents with no legal place to consume a legal substance. (Next door in New York, a new law legalizing marijuana permits cannabis consumption anywhere cigarettes are allowed.)

In Massachusetts, the cannabis commission has also requested legislative intervention around host community agreements, the controversial deals that marijuana operators must negotiate with their city or town before they can win a state license.

While municipalities are nominally barred from including fees that are not “reasonably related” to a pot company’s local impact, the vast majority of cities and towns charge the maximum — 3 percent of revenue — without enumerating any particular costs. The practice has drawn lawsuits and longstanding protests by both marijuana operators and advocates, who say the time, expense, and opaqueness of the local licensing process has favored bigger, richer, and better-connected operators over local entrepreneurs.

The new legislation would give the commission oversight of the deals, though municipalities would allowed a “safe harbor” period to renegotiate their agreements in accordance with the new rules before being penalized.

It would also strongly encourage municipalities to give preference to marijuana companies owned by state-designated “social equity” and “economic empowerment” applicants, mostly people from communities hit hardest by the war on drugs. To accomplish this, the measure takes a carrot-and-stick approach: Cities and towns where such businesses open will receive an extra 1 percent impact fee from the state, while those that fail to license such businesses by July 2023 will lose the ability to charge any fees at all.

Along the same lines, another portion of the proposed legislation would divert 20 percent of the state’s excise tax on recreational marijuana into a trust fund that would issue grants and loans to social equity and economic empowerment applicants, who in the absence of traditional bank loans for marijuana operations have struggled to secure private financing and get their businesses off the ground.

“The gap between the law’s stated commitment to equity and the on-the-ground reality of the industry shows just how much work we have left to do,” state Senator Sonia Chang-Díaz, the other co-chair of the cannabis committee, said in a statement. “There’s universal agreement about the problems: high costs of entry and lack of access to capital create a near-impossible barrier for many talented entrepreneurs. This bill addresses both sides of that coin.”

The fund would be administered by an independent board of experts under the auspices of the Executive Office of Housing and Economic Development. The regulators at the cannabis commission had also requested such a fund, with chairman Steve Hoffman warning last week that larger operators were exploiting the situation by hawking predatory deals to entrepreneurs with limited financing options.

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