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Signed, sealed, delivered. Massachusetts Governor Charlie Baker has signed a host of cannabis reforms into law, including measures to increase diversity, increase oversight on business and municipality agreements, and push the state closer toward consumption lounges. 

To combat the state’s lack of diversity in the industry, the new legislation calls to create a Social Equity Trust Fund. The new fund will be seeded with 15 percent of the money in the Marijuana Regulation Fund, which is funded by the marijuana excise tax, application and license fees, and industry-related penalties. Under the new fund, grants and loans will become available to entrepreneurs, with a focus on people of color and other groups disproportionately affected by the War on Drugs. 

Another welcome change for Bay Staters is the new law altering state tax code. Cannabis businesses can now write off their business expenses, an act that was previously prohibited for those in the industry. 

Following the extortion conviction of former Fall River Mayor Jasiel Correia, who manipulated the state’s host agreement requirements, the new law limits community “impact fees” to just 3 percent of a business’s total sales. The new legislation also allows the CCC to examine and approve host community agreements, ultimately offering more oversight to ensure the fees are justified and reasonable. 

The new bill also outlines a process for municipalities to allow on-site consumption establishments. We’ll be keeping an eye on the timeline for this new sector of the industry. 

Baker did veto one section of the bill: a measure instructing the CCC, Department of Elementary and Secondary Education, and the Department of Public Health to study and recommend ways to eliminate obstacles for students with medical marijuana cards to possess, administer, and consume the plant at public and private schools. 

“I support many of the provisions this bill adopts to improve regulation of the cannabis industry, and I support the bill’s efforts to expand opportunities for social equity businesses,” said Baker in a signing statement. Regarding the vetoed study, he said, “the language of the section is highly prescriptive – making it clear that the agencies charged with producing the study must identify ways to make medical marijuana widely available within schools, rather than considering whether such an allowance is advisable.”

We look forward to keeping up with the impact these new laws will have on the Massachusetts cannabis industry and beyond. 

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