Summary of Gov. Lamont's 2021 Legalization Proposal – S.B. 888
Gov. Ned Lamont’s 2021 proposal to end cannabis prohibition – S.B. 888 – would replace the unregulated illicit market with a taxed and regulated system of licensed cultivators, retailers, manufacturers, and delivery services. The bill also includes strong protections for public safety and deterrents for underage use. It directs an 11-member Equity Commission to develop equity-related recommendations by November 2021.
Legalizes possession of up to one and a half ounces.
Decriminalizes possession up to two and a half ounces, reducing the penalty to a civil penalty.
Law enforcement would be prohibited from effectuating an arrest or seizure of cannabis on the sole basis of activity in violation of federal law.
Law enforcement may not expend resources, including time, to offer information or support to federal law enforcement for federal cannabis violations.
On July 1, 2021, the department may begin accepting applications for eight (8) license types: retailer, hybrid retailer, cultivator, micro-cultivator, product manufacturer, food and beverage manufacturer, product packager, and delivery service.
Micro-cultivators would be allowed to manufacture cannabis, package and label products, perform extractions, create infused products, and to transport to other cannabis establishments. They could also sell and deliver cannabis and cannabis products to adult-use consumers, but not to patients or caregivers. Micro would be initially limited to 5,000 square feet of grow space and would be eligible for 5,000-increment increases. They would be limited to 2,000 square feet of retail space.
Retailer: $500 for lottery entry, $5,000 for a provisional license, and $2,500 for a final license
Hybrid retailer: $500 lottery entry fee, $5,000 for a provisional license, and $2,500 for a final license
Cultivator: $1,000 for lottery entry, $25,000 for a provisional license, and $75,000 for a final license
Micro-Cultivator: $250 lottery entry fee, $500 for a provisional license, and $1,000 for a final license
Product Manufacturer: $700 lottery entry fee, $50,00 for a provisional license, and $2,500 for a final license
Food and Beverage Manufacturer: $250 lottery entry fee, $1,000 for a provisional license, and $5,000 for a final license
Product Packager: $500 lottery entry fee, $5,000 for a provisional license, and $2,500 for a final license
Delivery Service: $250 lottery entry fee, $1,000 for a provisional license, and $5,000 for a final license
Backer License: $100 fee
Key employee License: $100 fee
Cannabis Establishment employee: $50 fee
Conversion fee for dispensary to become hybrid retailer: $250,000
Conversion fee for producer to become cultivator: $750,000
Allows dispensaries to apply for conversion to hybrid retailers beginning September 1, 2021 without applying to lottery process. Adult-use sales would begin on May 4, 2022. Consumers could purchase up to one ounce per day.
Allows a producer to sell, deliver, or transport cannabis or cannabis products to cannabis establishments, upon authorization by DCP after the completion of a conversion application and approval of a medical supply shortage plan.
Creates a third party lottery process for selecting licensees. Prior to the first date applications will be accepted, the department will post the maximum number of applications that will be approved for each license type. Once an applicant is selected as a lottery winner, they would receive a provisional license. Approved applicants may apply for a final license. Lottery selection is non-transferable. A provisional license expires after 12 months and shall not be renewed.
All deliveries from dispensaries and hybrid retailers must use delivery service for adult-use consumers until the earlier of May 1, 2023 or one year from the beginning of adult-use sales.
Establishes a wholesale tax of $1.25 per dry weight gram of cannabis flower, $.50 per dry weight gram of cannabis trim, and $.28 per wet weight gram of cannabis, in addition to the state sales tax of 6.25%.
Allows municipalities to levy a 3% gross receipt tax.
Directs revenue from cannabis licensing and taxes into the General Fund for 2022 and 2023. In 2024, 50% of the monies would be directed towards payments in lieu of taxes to municipalities, and the remaining 50% to the General Fund. In addition, the Equity Commission will make recommendations on redirecting funds.
Social Equity in the Cannabis Industry
Establishes an 11-member Equity Commission:
Two appointed by Governor, with at least five years’ experience in social justice or civil rights
One appointed by Governor, with five years’ experience in economic development
One appointed by Governor, with five years’ experience in providing access to capital to minorities
One appointed by the Black & Puerto Rican Caucus
Two appointed by Governor from communities that have been disproportionately harmed by cannabis prohibition and enforcement
The Commissioners of Consumer Protection, Economic & Community Development, Revenue Services, and Office of Policy Management or their designee
The Equity Commission would provide recommendations to: (1) target a portion of revenue to communities that have been disproportionately harmed by cannabis prohibition and enforcement; and (2) create a licensure program to ensure members of disproportionately harmed communities are provided equal access to licenses for cannabis establishments.
The Equity Commission would also report to the Governor and the legislature with recommendations on:
(1) the distribution of a portion of tax revenues to support residents in communities disproportionately harmed by cannabis prohibition;
(2) the distribution of a portion of tax revenues to support prevention and recovery programs;
(3) establishing the specific qualifications for equity applicant status for owners of cannabis establishments based on study;
(4) providing for expedited or priority license processing for each class of license;
(5) requiring any cannabis establishment licensed issued on or after January 1, 2022 and not owned by an equity applicant to comply with an approved plan to reinvest or provide employment and training opportunities in disproportionately impacted census tract areas OR in communities disproportionately impacted by high rates of drug related arrests, marijuana sale arrests, or marijuana possession arrests. For licenses issued prior to termination of the commission, the commission shall approve such a plan;
(6) establishing a lower fee structure for equity applicants;
(7) requiring that any cannabis establishment owned by an equity applicant shall be not less than a specified percent owned and controlled by one or more equity applicants, whose primary addresses have been in this state for the past five years and who manage the day-to-day operations and make long term decisions for the business;
(8) establishing a process to best ensure that equity applicants have access to the capital and training needed to own and operate a cannabis establishment; and
(9) establishing the entity that shall be responsible for implementing and regulating the equity program.
The Equity Commission report is due no later than November 15, 2021 to the Governor and General Assembly.
Redresses Harms Caused by Prohibition and Unequal Enforcement
Provides automatic expungement for possession convictions prior to October 1, 2015.
For possession convictions after October 1, 2015, persons may petition the court for erasure at no cost.
Eliminates cannabis possession as a basis for parole or probation revocation, unless a person has been found to be drug dependent and ordered to not use or possess cannabis.
Eliminates odor of burnt cannabis as a reason to effectuate a stop or search with an exception for suspicion of impaired driving.
Prohibits community host agreements by municipalities, which have been detrimental to equity in Massachusetts.
Allows municipalities to prohibit cannabis establishments except for medical cannabis dispensaries or producers. They may also establish hours and signage, within limits, and restrictions on density of cannabis establishments.
No municipality may prohibit delivery of cannabis or cannabis products to consumers, qualifying patients, or caregivers, when made by authorized delivery services.
Provides municipalities with enforcement ability for public health. Allows municipalities to issue civil fines for outdoor smoking of not more than $50.
Promoting Public Health and Public Safety
Creates protections against marketing and labeling towards minors.
Creates strong penalties for transferring cannabis to minors
Retailers may not display cannabis that is visible from outside the store.
Directs the Commissioner of the Department of Consumer Protection to:
establish health, safety, and security requirements, including storage and transportation requirements, and training and employment requirements;
prohibit products designed to appeal to children, including images of toys, cartoons, animals, kids, and products resembling trademarked foods;
restrict ads, including those with a high likelihood of reaching children; and
require a warning label or handout with retail cannabis, which includes risks related to driving, cannabis use disorder, the developing mind, psychiatric disorders, pregnancy and breastfeeding, and explaining the need to safeguard cannabis from minors and pets.