Massachusetts Cannabis Business Licenses
WHAT IS MASSACHUSETTS' CURRENT CANNABIS MARKET STATUS?
Massachusetts is home to both medical and adult-use cannabis markets. In 2016 voters approved a ballot initiative that legalized cannabis for adult use, while also eliminating penalties for possession of small amounts of cannabis and cultivation of a small number of plants. On November 20, 2018, the first two recreational dispensaries opened doors for the sale of cannabis to adults 21 and older. Within the first week of operations, the two stores combined sold $2, 217,621 in cannabis products to adult-use consumers. The industry has continued to show strength within the Commonwealth, recording nearly $400 million in sales in its first full year of operation with an average of $46 million in sales per month.
Due to the two-month closure of all recreational operations implemented by Governor Baker as a response to the COVID-19 pandemic, the fiscal year 2020 saw skewed sales numbers across adult-use and medical cannabis establishments. Although the Commonwealth experienced business closures and lulls in customer volume during 2020, Massachusetts legal, adult-use gross sales have still totaled over $1 billion since 2018, generating $539 million in sales within 2020. With the resurgence of sales since dispensaries have opened doors to limited capacities and have begun home delivery operations, cultivators and processors are carefully increasing staffing to full capacity to ensure an uninterrupted supply chain.
With the introduction of new license types in the Commonwealth and a growing consumer base, the Massachusetts cannabis market will be one of the most quickly evolving markets in the East Coast cannabis industry.
WHAT ARE MASSACHUSETTS' CANNABIS LAWS?
In November 2012 Massachusetts voters approved the Massachusetts Medical Marijuana Initiative permitting medical cannabis for patients who possess a Commonwealth-issued registration card after receiving a recommendation from a physician. The law allows for licensed dispensaries to provide up to one ounce of cannabis, or five grams of cannabis concentrate per transaction to patients as stated in the Regulations.
In November 2016 the voters of Massachusetts passed a ballot initiative legalizing recreational cannabis. Once dispensaries opened, adults 21 and older were able to purchase and possess up to one ounce of cannabis, and grow up to six plants within the privacy of their homes with a maximum limit of 12 plants per household for residences with two or more adults living in the home. Once harvested, the household may hold up to a maximum of ten ounces. Under the initiative, cultivators have the opportunity to apply for a variety of Massachusetts cultivation licenses broken down in a tier system based on the amount of plants grown. Full text of both medical and recreational regulations can be found here.
During November and December of 2020, amended regulations and legislation went back and forth behind closed doors at the Cannabis Control Commission, resulting in new regulations being released and implemented for cannabis establishments going into 2021. With new regulations came announcements of new license types, Delivery Courier and Warehouse Delivery, for Massachusetts Operators. These licenses are currently limited to Social Equity Applicants in the Commonwealth of Massachusetts. The Delivery Courier license allows Delivery operators to facilitate deliveries for Dispensary licensees. The Warehouse Delivery license allows for consumer orders to originate from a non-storefront warehouse facility.
Massachusetts’ medical and recreational cannabis businesses must negotiate a Community Host Agreement with the city or township in which the facility operates. Cities and townships are allowed to implement a community impact fee of up to 3% of the businesses’ annual revenue.
WHAT IS MASSACHUSETTS' CANNABIS LICENSING TIMELINE & CANNABIS APPLICATION PROCESS?
The Massachusetts application process is available for the following license types: Medical Marijuana Treatment Center (MTC); Marijuana Cultivator (Indoor and Outdoor; 11 Different Tier Sizes); Craft Marijuana Cooperative; Marijuana Product Manufacturer; Marijuana Retailer; Existing Licensee Transporter; Third-Party Transporter; Marijuana Research Facility; Independent Testing Laboratory (ITL);, Standards Testing Laboratory; Microbusiness; Wholesale Delivery (Social Equity Only); Delivery Courier (Social Equity Only); and Social Consumption Establishments (Social Equity Only).
Each license type comes with an associated application. Annual licensing fees ranging from $200 to $50,000 are waived for Economic Empowerment applicants and Social Equity Program Participants. The Cannabis Control Commission (CCC) provides an in-depth breakdown of the fees and additional application resources on the Application Guidance document (Jan 2020).
Hopeful operators must remain patient during the licensing process. Operators receive a provisional license prior to receiving a final license with the expectation that facilities will work toward meeting the compliance inspection requirements set forth by the CCC. Additionally, those participating in the Social Equity Program, or are an Economic Empowerment applicant will receive priority during the application review process.
To apply for a Commonwealth of Massachusetts cannabis license, you must register here.
WHAT IS THE HISTORY OF CANNABIS IN MASSACHUSETTS?
Possession of small amounts of cannabis became decriminalized in Massachusetts in November 2008 with the passage of The Massachusetts Sensible Marijuana Policy Initiative. The initiative made possession of less than one ounce of cannabis punishable by a $100 with no possibility the citation would be reported to the Commonwealth’s criminal history board. Parents must be notified if minors are found to possess more than one ounce of cannabis. The minor must also participate in a drug awareness program, and complete ten hours of community service. This is a drastic change from the previous law in which those charged with cannabis offenses faced up to six months in jail and a $500 fine.
The Massachusetts Medical Marijuana Initiative, also known as Question 3, was approved by a 63% vote allowing for the establishment of a Massachusetts Medical Cannabis Program. Effective January 1, 2013 patients could purchase and possess up to a 60 day supply, or ten ounces per every two months of medical cannabis. Although some cities and townships attempted to ban cannabis businesses in their local municipalities, Attorney General Martha Coakley later ruled bans would conflict with the law, and municipalities were only allowed to regulate — not ban cannabis.
As a result of the November 8, 2016 election, recreational cannabis for adults 21 years and older became legal in Massachusetts. Although provisions for homegrown cannabis went into effect on December 15, 2016, dispensary doors did not open until November 20, 2018. In terms of recreational cannabis facilities, local municipalities have the authority to require local permits and decide whether or not a facility may be established.
DOES MASSACHUSETTS HAVE A HEMP PROGRAM?
Massachusetts hemp businesses face financial ruin after the state banned the sale of most CBD products. The edict was deemed a “policy statement” outlining the Commonwealth’s interpretation of existing law. Follow this link to get access to the application resources and fees for both grower and processor. You may also apply for a dual license if you intend to co-locate businesses.
ARE YOU PREPARING FOR THE MASSACHUSETTS CANNABIS MARKET?
Massachusetts is currently accepting applications for all cannabis facility types providing ample opportunities for entrepreneurs. Each township and local municipality is equipped with its own zoning laws and requirements as they pertain to cannabis establishments. You can review the Cannabis Control Commission’s municipality tracker here to find cannabis-friendly townships near you.
Point7 is pleased to offer an array of products and service packages that are customizable to your needs. Whether you are in the beginning stages of the application process or are already operating and need procedures and compliance assistance, Point7 has the knowledge and resources to assist you.