Towns Can't Count on Cannabis Fees
WILLIAMSTOWN, Mass. — The town is accounting for the loss of about $300,000 in "impact fees" due to regulatory changes coming down from the commonwealth's Cannabis Control Commission.
Town Manager Robert Menicocci explained to the Select Board on Monday that the CCC has implemented a "pretty dramatic shift" in the rules surrounding the host community agreements signed by marijuana retailers and municipalities.
The commission earlier this fall gave itself the authority to approve or void HCAs and issues sanctions against host communities that are not in compliance. Communities also must be much more specific in how they claim impact fees, prohibits them from asking for future payments, charitable contributions, escrows or bonds, setting the fee as a percentage of sales, or limiting the licensees ability to dispute the fees. Fees can no longer be imposed after a license has been held for nine years.
Williamstown currently has one dispensary and, since it came online relatively early after the state established a regulatory regime following the 2016 referendum to legalize recreational pot, that community agreement is up for renewal.
"We had had a draft agreement that we had proposed to our retailer here in town and proposed that, on a short-term basis, back in the spring, to do this for a six-month period and, at that point, we would hopefully have clarification from the CCC," Menicocci said. "The attorneys went back and forth on that for some period of time, and we got to the point where the regulations actually came out, and the retailers' attorneys decided, based on that guidance, they wanted to further edit the agreement.
"That's where we're at right now. And I just want to make this clear to folks that this is very much on the radar and very much going nowhere at the same time. It's not for lack of trying that we don't have a host community agreement in place. As we talked about the impact fees associated with this, which was a large part of, I think the eagerness to jump into this business and be supportive of having establishments here in town — that largely goes away."
Menicocci said the state regulatory agency has made it more difficult for cities and towns to collect any impact fees from dispensaries. The change has elicited reactions from municipalities running from protests to threats to take the CCC to court.
"Not only [was the CCC] going to hold communities to very rigorous proof of the impacts, but they're also characterizing this as an 'impact plus,' " Menicocci said. "If a retailer had a number of calls for service from, say, the police … what the CCC is now saying is, 'That's normal, because the police go out to any establishment,' whether that be a bar, restaurant or store. So what you have to do is have even a higher bar set on this, above and beyond what would be ordinary.
"So the impact fee piece of this, I think, has essentially faded away. And once again, it's going to need further clarification on whether we can even recoup what was under our regional contract. We have a payment due to us under our old contract that we have not received from our retailer. That's not unusual. All retailers just stopped [paying] because the CCC said, 'Hey, we think this is retroactive to whenever we feel like saying it's retroactive to.
"That would be extraordinary, and even as part of the comment on the regulations, some of the legislators involved in this commented, 'That wasn't our intent.' "
While the town was able to account for the loss of impact fees in the budget, Menococci reminded the Select Board that there was a one-time boost in property tax revenue that helped smooth out the shortfall in revenue.
"When we said we had a good year last year with Cable Mills coming online, that was one factor why we weren't cutting our budget just to get through the year because of a revenue drop, a sizable one for our community," Menicocci said.
One topic on the agenda for Monday's meeting, the last scheduled session of calendar 2023, was the Select Board member's budget priorities for fiscal year 2025.
After taking feedback from his colleagues on the language used in those requests, Andrew Hogeland was tasked with submitting a final document to the town manager and Finance Committee that identifies four budget priorities for the coming fiscal year: lessening the property tax burden on residents, assessing town infrastructure with an eye toward energy efficiency, website and communication improvements and allocating town funds to support, "programming and events designed to create opportunities for enhancing our sense of community."
Menicocci and his staff are in the process of developing an FY25 budget that ultimately will be presented to town meeting in omnibus form in May.
The Select Board also approved the calendar for that meeting and the annual town elections.
On the election side, nomination papers will be available on Monday, Feb. 5. Papers with signatures from a requisite number of town voters are due back for certification by the town clerk on Tuesday, March 26, for an election that will be held on Tuesday, May 14, from 7 a.m. to 8 p.m. at Williamstown Elementary School.
Town meeting is scheduled for one week later, on May 21, at 7 p.m. at Mount Greylock Regional School.
The last day to submit warrant articles for that meeting — including via citizens petition — is Monday, March 25. Select Board Chair Jeff Johnson reminded residents that articles submitted via citizens petition require at least 10 signatures, though more are recommended, and potential petitioners are encouraged to meet with the town manager to make sure their article language is properly worded to ensure its efficacy if passed by town meeting.
The board discussed setting a potential date for a continuation of town meeting to address concerns in recent years that overly long meetings are discouraging participation by residents. Hogeland suggested that the decision could be made in March, after the board has a sense of what the meeting warrant looks like.
He did note that some potential warrant articles the Select Board itself is crafting could generate discussion at the May meeting. On Monday, the board discussed the fine points of two proposals it has discussed bringing to the meeting: a further expansion of the senior tax exemption for property taxes and a property tax exemption based on the commonwealth's senior "Circuit Breaker" tax program.
Both the programs, which require beneficiaries to demonstrate need based on income limits, would shift some of the property tax burden away from those in need to more affluent property owners.
In other business on Monday, the Select Board:
• Approved annual liquor, innkeeper and common victualer licenses for 2024.
• Received an update on the town's process for redoing its website. The town is looking at several vendors with experience doing municipal websites in an effort to make the town's page easier to navigate and to address issues of compliance with the Americans with Disabilities Act.
• Reminded residents that there are two more information sessions this week for potential applicants for Community Preservation Act funds in FY25: Wednesday and Thursday from 1 to 3 p.m. in the town manager's office at town hall.
• OK'd an underground extension of electrical conduit by National Grid on Sweet Farm Road.
• And signed off on a conservation restriction for 10 acres of land recently acquired by Williamstown Rural Lands Foundation on Oblong Road. WRLF Executive Director Robin sears and President Greg Islan explained that the non-profit is planning to create handicapped parking spaces at the site and construct a handicapped-accessible path into the trees to a spot with an ADA-compliant picnic table.
Tags: Cannabis Control Commission, marijuana dispensary,
