“We appreciate action on medical deintegration … and other overdue reforms—but handing more power to big cannabis and gutting the CCC’s independence are poison pills.”
A savage ratfucking is underway, and Massachusetts cannabis business owners and consumers who may end up getting screwed have state lawmakers to thank.
Since last year, Beacon Hill legislators and other state officials have been itching to rain hell on the Cannabis Control Commission. That has included calls for an audit by Inspector General Jeffrey Shapiro, who has rightfully identified innumerable agency shortcomings, as well as rambling condemnations from senators and representatives.
But now there’s confirmation that they don’t actually give a shit. Because while legislators feign concern for the commission and the companies it licenses, they are concurrently denying increased funding to the troubled agency and are now—as we just learned yesterday—considering an omnibus bill that could devastate the Massachusetts industry to benefit a few deep-pocketed out-of-state businesses.
The State House News Service reports: “The bill adjusts the existing cap on retail licenses any one operator can hold. The current limit is three, but some business owners have said the cap prevents them from selling their businesses. Under the bill advancing towards the House, the cap on retail licenses would be raised to six, and the existing three-license caps would remain in place for cultivation and manufacturing.”
So much regulatory capture considered, it’s no surprise that “current and former cannabis regulators, business leaders, and [the advocacy group] Equitable Opportunities Now … are sounding the alarm about [the] House-backed cannabis bill that, they warn, poses an existential threat to small, local, and equity-owned businesses in Massachusetts.”
As EON explained in a media release, “The bill would more than double existing license ownership limits by allowing individuals and entities to hold up to 6 licenses outright and up to 35% ownership in an unlimited number of additional businesses, which … would pave the way for large multistate operators (MSOs) to consolidate control of the industry.”
“This bill is a gift to corporate cannabis and a death sentence for local and social equity businesses,” EON Co-Founder Shanel Lindsay said. “How is someone with one, two, or three stores supposed to compete with someone buying for six or more stores? It will undermine everything Massachusetts has worked so hard to achieve in building the most equitable cannabis industry in the country.”
The fight over license caps up until now
As we reported in April, license cap expansion was front and center at a recent hearing of the Joint Committee on Cannabis Policy. The topic dredged up lots of tension, with EON sending a letter to House Speaker Ron Mariano “on behalf of nearly 60 cannabis business owners, social equity applicants, advocates, and community leaders … express[ing] deep concern and disappointment over proposals to weaken Massachusetts’ cannabis license ownership limits—one of the most important safeguards for equitable industry participation.”
At the hearing, Tito Jackson, a former Boston city councilor and current owner of Apex Noire dispensary in Boston, spoke in favor of raising the license cap alongside Payton Shubrick of 6 Brick’s in Springfield. Together they argued that the industry is in a tough spot at the moment, and that companies like theirs need the option of an exit plan via selling to a larger company that’s looking to expand its footprint in the state.
“This is a difficult industry,” Shubrick said, “the rules are constantly changing depending on your [CCC] investigator, and it’s getting harder to meet the day-to-day needs. … I cannot exit the space and I can not improve my business model. … Increasing the cap doesn’t mean that everyone has to sell; however, not giving people that option is problematic.”
Among the many testifying on the other side of the issue, Sen. Liz Miranda told her colleagues that social equity advocates by and large “don’t want one or two businesses dominating the Massachusetts cannabis market.” She said she spoke with friends and constituents on both sides of the ownership limit debate leading up to the hearing, and ultimately decided against giving more leverage to “multi-state conglomerates and shell companies” which, the senator alleged, are already skirting ownership limits.
In response to this week’s news, former CCC Commissioner Shaleen Title said the “limits imposed by the Massachusetts legislature have been one of the strongest and most effective ways to support small businesses, promote equity, and protect the public from concerns related to corporate misconduct when marijuana is legalized.” A founder of Mass EON, she continued, “Our ownership limits in Massachusetts provide protection against corporate concentration by Altria, British American Tobacco, Molson Coors, and other companies who are lobbying for federal legalization and preparing to make acquisitions in markets like Massachusetts. What would be the policy implications of doubling the potential market share of these companies?”
The rest of the House bill
The EON statement continued: “Small business owners are also concerned that the bill proposes dismantling the independence of the CCC by replacing five full-time independent commissioners with just one full-time and two part-time commissioners. This shift would politicize policymaking and enforcement, weaken accountability, and strip power from the very communities the law was designed to uplift.”
Beyond the aforementioned sections, advocates acknowledge that the whole bill isn’t rancid. Among the positives they recognize: “language from Sen. Liz Miranda’s S.88 to strengthen enforcement of existing ownership limits”; “medical vertical deintegration with exclusive access for equity businesses”; “increased purchase and possession limits.”
EON wrote: “While advocates praise Cannabis Policy Chair Dan Donahue and House members of the Committee for including several positive provisions, they would rather the Legislature do nothing than pass a flawed bill that gives control of the market and policymaking to the largest, most profitable businesses.”
“We appreciate action on medical deintegration, enforcing ownership limits, and other overdue reforms—but handing more power to big cannabis and gutting the CCC’s independence are poison pills,” EON Deputy Director Kevin Gilnack said. “Most cannabis businesses would be better off if the legislature did nothing.”
“We support stronger enforcement of ownership limits but not their elimination in practice,” said Kim Napoli, Esq. of the social equity business Underground Legacy Social Club LLC. “Allowing MSOs to control up to six stores and 35% of unlimited other stores while gutting the CCC’s independence is not reform. It’s a hostile takeover.”
“We’re just starting to see real progress: delivery operators are becoming profitable, grants are rolling out, and social consumption is on the horizon,” said Philip Smith, a social equity cannabis manufacturer and CEO of Freshly Baked. “Now is the time to stabilize the market, not rig the rules in favor of those who already have the most.”
EON Co-Founder Shanel Lindsay said: “Lawmakers must choose: Will they protect the public interest and equity—or cave to pressure from the cannabis industry’s biggest players?”
