Massachusetts Cannabis

August 7, 2018

Is the Massachusetts Cannabis Control Commission Going to Enforce the Cap on Host Community Agreements?

The Massachusetts Cannabis Control Commission is finally putting some teeth into enforcement of the practice of cities and towns trying to extract additional fees from recreational marijuana businesses. At present, the law requires that recreational marijuana businesses obtain a “Host Community Agreement.” In other words, the marijuana operators must negotiate with the municipality to get their approval before they can locate their business within the community. This has opened up a point of leverage for the cities and towns to exploit their power. The Host Community Agreement allows the municipality to get a fee of up to 3 percent of their gross sales from the marijuana operators. Since the businesses must get the consent of the municipality when it applies for a license, the municipalities have used this opportunity to demand “voluntary” fees in excess of the 3 percent cap. As the Boston Globe reported recently, the municipalities are probably breaking the law.