The only thing it will do is put me into a worse situation.
By Bhaamati Borkhetaria, CommonWealth Beacon
The cannabis industry is divided over whether to maintain the three-dispensary limit.
The state set the license cap in 2017 as a measure to keep large companies from monopolizing the cannabis industry and to protect small cannabis business owners—particularly those who come from communities harmed most by the war on drugs.
Some cannabis entrepreneurs now say that the limit restricts their abilities to run their business. Some cannabis entrepreneurs have said that the Legislature should increase the cap on licenses to help struggling businesses attract capital from multi-state operators.
All the bills that are currently being considered seek to increase the limit of licenses from three to six or nine. A bill would allow businesses that already have three licenses the opportunity to own more than four social equity companies.
At the Legislature’s first cannabis hearing of the legislative session on Wednesday, marijuana business owners and leaders spoke for the bills to raise the cap.
Payton Shubrick of the 6 Bricks dispensary, located in Springfield, has argued for an increase in the limit. She stated that the business was family-owned, and she has had to deal with the fall in marijuana prices since opening her dispensary. According to the testimony of her, increasing license caps will give larger companies more chances to purchase or invest in businesses like hers.
Shubrick stated, “At this time I have an asset that is slowly losing its value due to oversaturation. This creates a dynamic which makes it impossible for me to make a profitable exit.”
The owner of Apex Noire—the first black-owned dispensary to open in Boston—and a former member of the Boston City Council, Tito Jackson, also spoke in support of changing the license cap.
“Increasing the license cap should be seen as a tool—one that business owners can use if they are able to,” said Jackson. “It does not mean that…everyone has to sell. It is harmful to deny these individuals this option.
Cannabis business owners from other states also testified against the bill.
Ruben Seyde is the owner and operator of Delivered Inc. a cannabis-delivery company. He said: “I guarantee that raising the limit will have the opposite effect of everything else people mentioned.” “It will not help [social equity businesses like mine]. This will only put me into a more difficult position than I’m in now. Already, I’m struggling to compete in this industry. I am already struggling in this market. [multi-state operators] “I have no other future than the larger companies.” “I have no other viable route to follow to reach a level of profitability from where I am now.”
Before the hearing on the legislation, almost 60 cannabis business leaders signed a petition urging lawmakers to keep the limit of three dispensaries per business.
We’ll see. [multi-state cannabis businesses] Kevin Gilnack (Deputy Director of Cannabis Advocacy Group Equitable Opportunities Now) said this in a telephone interview before the hearing.
Kimberly Roy is a member of the Cannabis Control Commission and has submitted a written statement to the Legislative Committee in support of the cap on licenses.
“Current statutory ownership limits help to create a Massachusetts cannabis industry that encourages full participation, competition, locally owned and operated entrepreneurship…while fostering a diverse marketplace,” said Roy. “Current proposals to lift the current license cap threaten to undermine these goals, harm those we are mandated to help and as a by-product may create a ‘Walmart effect’ supply chain where market consolidation, buying power and price manipulation can be controlled by the wealthy few.”
Cannabis industry is struggling due to the declining price of marijuana, and lack of capital. Social equity business owners—who come from disadvantaged backgrounds and, by definition, have limited access to capital—have been particularly hit by debt and the challenges of the industry.
The hearing was overwhelmingly in favor of two bills which would increase the limits on cannabis possession and purchase, and simplify the registration process for cannabis workers. The current system requires that every employee of a cannabis-related business obtains a unique registration for each different license establishment. A single person could need to register multiple times, which can be costly for the business owner. The business community is in favor of streamlining the registration process.
A second bill will allow medical marijuana companies to keep their licenses without having to grow, process or dispense any cannabis. The bill also reduces the license fee for Massachusetts medical dispensaries, and allows people with medical marijuana cards from other states the use them at Massachusetts medical cannabis dispensaries.
“We need to reinvest in the future of the program, and that means streamlining it, modernizing it, and removing the shackles that limit patient access and prevent equity [owners] Jeremiah MacKinnon said, “We want to prevent people from working in the medical field.” We brought these issues before the [Cannabis Control] Commission, but nothing has changed after six years. The issue was not on the list of priority.”
This article first appeared on CommonWealth Beacon and is republished here under a Creative Commons Attribution-NoDerivatives 4.0 International License.
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Mike Latimer provided the photo.
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