Pubdate: Sun, 02 Nov 2014
Source: Boston Globe (MA)
Copyright: 2014 Globe Newspaper Company
Contact: http://services.bostonglobe.com/news/opeds/letter.aspx?id=6340
Website: http://bostonglobe.com/
Details: http://www.mapinc.org/media/52
Author: John Laidler

OFFICIALS PURSUING MARIJUANA REVENUES

As a nascent medical marijuana industry prepares to launch in 
Massachusetts, some area communities are starting to pursue ways to 
potentially tap revenues from the pot-dispensing businesses.

Plymouth Town Meeting recently authorized officials to seek special 
legislation to charge a 5 percent local excise tax on the 
cultivation, transfer, or sale of medical marijuana or other cannabis 
products within the town.

The action comes in the wake of the Board of Selectmen signing a host 
agreement with the nonprofit William Noyes Webster Foundation, which 
seeks to set up a medical marijuana cultivation facility in a leased 
building on Industrial Park Road.

The five-year agreement would provide the town with up to $300,000 a 
year in payments from the foundation, including donations to the 
community and payments equal to what the foundation would pay in 
taxes if it owned its building and was a for-profit entity.

Plymouth's excise tax proposal originated from a task force created 
by selectmen about a year ago to explore possible new sources of revenue.

"It's pretty obvious there are opportunities for municipalities 
here," said John Moody, chairman of the town's Advisory and Finance 
Committee, and a member of the task force, referring to the revenues 
that cities and towns might realize from hosting medical marijuana 
facilities. He said an excise tax "seemed like a reasonable option for us."

The task force has estimated that a 5 percent excise tax would yield 
the town about $170,000 in annual revenues from a cultivation 
facility, assuming a 10,000-square-foot building that produces 759 
pounds of medical marijuana annually.

'It's pretty obvious there are opportunities for municipalities.'

The proposal is based on special legislation filed earlier this year 
by the town of Dennis, where the William Noyes Webster Foundation has 
a provisional state certificate to open a dispensary. The town's 
proposal also calls for a 5 percent local excise tax.

The foundation initially proposed housing its dispensary and growing 
facilities in separate sites in Dennis, but now wants to grow the 
marijuana at the Plymouth site because it has more room. The 
foundation is seeking state approval for the change, said its lawyer, 
Valerio Romano.

Quincy, meanwhile, negotiated a host agreement with Ermont, a 
nonprofit that has provisional state approval to open a medical 
marijuana dispensary in the city. The deal would require Ermont to 
provide Quincy with 3 percent of its gross revenues each year, 
according to Christopher Walker, spokesman for Mayor Thomas P. Koch.

Walker said Quincy is not pursuing a local excise tax because it 
believes the Legislature is likely to want to address the idea on a 
statewide basis.

Brockton has a tentative host agreement with a nonprofit, In Good 
Health, that has a provisional certificate to operate a dispensary 
with a marijuana growing facility in the city, according to Mayor 
Bill Carpenter.

Under the proposed deal, the company would pay the city 3 percent of 
its gross annual income, or at least $100,000, and another 1 percent 
to nonprofits in the city that provide treatment and other services 
for people with substance-abuse problems.

Carpenter favors an excise tax but said that, given the uncertainty 
of achieving that any time soon, he wanted to have the agreement in 
place to ensure a reliable source of income for the city if the 
facility begins operating.

The host agreements in Brockton, Plymouth, and Quincy all anticipate 
the potential of an excise tax with provisions that set limits on how 
much the provider would owe in combined taxes and payments while also 
ensuring the community a minimum level of income.

The 2012 ballot initiative that legalized medical marijuana in 
Massachusetts allows the state to license up to 35 dispensaries, with 
at least one but no more than five in each county.

The state in January gave initial approval to 20 dispensary 
applications, but in June issued preliminary certificates to just 11 
of them. Among the rejected applications were three by Medical 
Marijuana of Massachusetts for sites in Plymouth, Mashpee, and 
Taunton. The group filed a lawsuit in August contesting its elimination.

Plymouth Town Manager Melissa Arrighi said that even as her town 
pursues the local excise tax, it made sense to also secure a host 
agreement due in part to the uncertainty about gaining state approval 
of the tax. Selectmen authorized the host agreement at an Oct. 7 
meeting at which they agreed to send a letter of "non-opposition" to 
the cultivation facility.

The town manager in Dennis, Richard White, said his community's 
proposed special legislation had a hearing on Beacon Hill but has not 
progressed further. He said it may have encountered concern as a 
proposed new tax and due to the complexities involved.

"It was our way of pushing the Legislature to come up with some 
comprehensive policy" on how to help cities and towns with the costs 
of hosting a medical marijuana facility, he said.

Romano said the William Noyes Webster Foundation does not oppose 
excise taxes as long as they are reasonable.

"We think local municipalities should be compensated for their 
hosting of a controversial issue," he said.
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MAP posted-by: Jay Bergstrom