Massachusetts marijuana law changes rile pot activists
BOSTON — Marijuana users would pay substantially higher taxes, while city and town officials would have more leverage to ban retail pot shops, under a raft of rules proposed for the state’s legal weed industry.
On Wednesday, a legislative panel approved a bill strictly limiting the cultivation, sale and use of marijuana. The legislation was expected to come up for a consideration Thursday in the House of Representatives, but legislative leaders decided to postpone a vote until next week. The Senate must also approve the measure.
Pot advocates blasted the proposal, saying it guts key provisions of the law legalizing marijuana that voters approved last November.
“They’re blatantly defying the will of the voters,” said Jim Borghesani, a spokesman for the Campaign to Regulate Marijuana Like Alcohol, which pushed legalization.
House Speaker Robert DeLeo told reporters that lawmakers raised concerns about the bill that need to be addressed before it’s put to a vote.
“There are certain things we have to clear up,” he told reporters, without elaborating. “We want to get it right the first time, so we don’t want to rush it.”
More than 54 percent of Massachusetts voters approved the law, which allows adults 21 and older to possess up to an ounce of marijuana in public and 10 ounces at home, and to grow up to a dozen plants on their property. It also allows retail sales and growing facilities, which are expected to open next year.
Currently pot sales would be subject to a 3.75 percent excise tax and a 2 percent local tax — in addition to the state’s 6.25 percent sales tax.
Lawmakers and state officials say the combined 12 percent levy isn’t enough to cover the costs of regulating the industry.
Under the proposed changes, pot sales could be taxed up to 28 percent — with a 16.75 percent state tax and a 5 percent local tax, in addition to sales taxes.
Borghesani said the actual rate could be as high as 47 percent because commercial growers who supply the retail market would also be taxed.
“The tax rate is going to be so high that it’s going to encourage the blackmarket to continue,” he said. “This is not the right way to create a legal marijuana market.”
Geoff Beckwith, executive director of the Massachusetts Municipal Association, said he welcomes the higher tax levy but wants a larger share to go to cities and towns.
Local marijuana tax should be at least 6 percent, he said, to cover the costs.
“The state isn’t going to be going out to enforce this law,” he said. “That’s a cost that will be borne largely by cities and towns.”
Some states where recreational pot is legal have taken steps to reduce taxes, citing concerns that legalizing marijuana hasn’t reduced black market sales.
Oregon reduced pot taxes from 25 to 17 percent late last year, while Colorado’s tax rate will drop from 29 to 27 percent in July.
Alaska’s rate is 25 percent. Washington D.C. is prohibited by federal law from taxing and regulating pot sales.
Maine, which also legalized marijuana in November, has set the rate at 10 percent, while California has set a 15 percent rate. Nevada voters approved a 15 percent tax.
Proposed changes in Massachusetts’ pot law would also give city councils and selectmen the authority to restrict, or even ban, pot shops within their communities.
The voter-approved law requires a community-wide referendum to outlaw pot shops.
“It makes more sense to have a legislative body make that decision, rather than a costly referendum,” Beckwith said. “No other zoning issue is subject to a referendum.”
Borghesani said the voter approved law gave local governments control over pot shops.
“They can determine the location, the hours and signage,” he said. “But taking away the rights of local constituents and giving it to selectmen or city councils is a bad move.”
Those opposed to recreational marijuana want lawmakers to restrict, if not set aside, many of the controversial provisions of the new law. They argue that the law was written by the multi-billion-dollar marijuana industry, and voters were misled about many aspects.
The proposed rules also include restrictions on marijuana advertising and marketing.
TV, radio, print and even billboard advertising would be banned unless at least 71 percent of the audience is over 21.
It wasn’t clear how that would be enforced.
Cities and towns would be allowed to further restrict advertising and signage.
The proposed legislation would also make changes to the yet-to-be-created Cannabis Control Commission, which will oversee recreational and medical marijuana.
The law would take control of the five-member regulatory body away from the state treasurer’s office.
A 17-member committee of House and Senate lawmakers that drafted the proposal kept details of the bill under wraps before they were unveiled Wednesday.
Whether the proposal has enough support to pass the Legislature was unclear.
Gov. Charlie Baker hasn’t said where he stands on it.
Many lawmakers hadn’t even seen a copy of the bill just one day before the House was set to vote on it. Several declined to comment, saying they hadn’t yet reviewed it.
Rep. Lenny Mirra, R-West Newbury, who supports legalization, said lawmakers should be cautious about ratcheting up taxes because that could drive blackmarket sales. He was still reviewing the proposal but said he will likely vote against it.
“The voters have spoken, emphatically,” Mirra said. “We need to respect that.”
Christian M. Wade covers the Massachusetts Statehouse for North of Boston Media Group’s newspapers and websites. Email him at cwade@cnhi.com.