Massachusetts Governor Signs Cannabis Industry Reform Bill

Massachusetts Gov. Charlie Baker (R) on Thursday signed the bill package of cannabis industry reforms, which includes social-equity provisions, tax reforms for the industry, and a reworking of the state’s host community agreements, Axios reports. The measure also includes a re-tooling of how the state expunges previous cannabis convictions and includes a pilot program for cannabis cafés.  

The new law alters the state tax code so cannabis businesses can write off business expenses like non-cannabis firms. Previously, the state did not allow cannabis businesses to take normal business deductions.

Under the law, communities can still impose a limited-time “impact fee” on cannabis businesses that seek to open shop in their municipality, but that fee is now limited to 3% of the business’s total sales. The so-called community host agreements came under fire following the arrest, and ultimate conviction, of former Fall River Mayor Jasiel Correia who extorted cannabis businesses under the guise of the host agreement.

Baker did veto part of the bill that would have led to a study on pediatric medical cannabis consumption in 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. I have serious concerns, however, about [the study]. 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.” — Baker, in a signing statement, via the Boston Globe  

Lawmakers had approved the omnibus cannabis bill unanimously in the Senate and 153-2 in the House. Massachusetts lawmakers could decide to try and override Baker’s veto of the section providing for the study, but the state’s formal session has ended.