Impact Fee For Pot Stores Under Review New
Marijuana retailers want to remove the impact fees they pay cities and towns to set up shop, arguing the industry has had minimal impact on police, firefighters and other city departments.
A proposal tabled by Representative Andy Vargas, D-Haverhill, would require local governments to conduct annual audits of costs for their communities hosting potty businesses and reimburse dispensaries, if necessary. If a community fails to do an audit, clinics could take legal action to recover the money.
Supporters of the changes say some communities are moving beyond the 2016 referendum legalizing marijuana by charging excessive fees to settle.
“These fees were designed to offset the cost to communities, which has been negligible,” said David Torrisi, president of the Commonwealth Dispensary Association, which represents marijuana retailers. Some communities use impact fees for non-cannabis expenses, he said.
The 2016 law allows adults 21 years of age and older to own up to 10 ounces of weeds and allows regulated cultivation and sale. The law also allows communities to charge excise taxes of up to 3% under “hospitality agreements”. This is in addition to the state cannabis excise tax of 10.75% and the state sales tax of 6.25%.
Cities and towns may also charge impact fees that are “reasonably related to the costs” of hosting a pot business, such as staffing additional police patrols, but which do not exceed 3% of revenue. gross of the business.
These fees must be renegotiated by the communities every five years by law.
Meanwhile, some communities have added a “reopening” clause to pacts that require marijuana dealers to increase payments if they give more money to other communities.
Marijuana industry advocates say the long lines and traffic jams outside dispensaries following the opening of the first retail stores in late 2018 have long subsided. Most clinics hire out their own security and do not rely on local police.
As of 2020, at least 46 municipalities had at least one open recreational pot dispensary, according to the state’s Cannabis Control Commission.
The Massachusetts Municipal Association strongly opposes efforts to eliminate community impact fees, which argues that agreements are no different from contracts with real estate developers and others to offset the increased costs of the provision of police, fire or other municipal services.
In previous testimony on a similar proposal, Geoff Beckwith, the association’s executive director, suggested that the move is part of a broader strategy to “diminish and weaken the role of the municipality in granting processes. and licensing, ”which“ could have a long-term impact on the ability of municipalities to contract freely, even outside the marijuana industry. “
Marijuana industry experts excessive entry fees are unnecessarily stunting market growth by crowding out small businesses that cannot afford the high fees.
“There are communities that assess the fees of marijuana companies that go way beyond the scope of the law,” Jim Borghesani, a marijuana industry consultant who has worked on the ballot issue of 2016. “The rules of the game must be level.”
Christian M. Wade covers the Massachusetts Statehouse for newspapers and the North of Boston Media Group websites. Email him at [email protected]