Burns & Levinson’s Fourth Annual State of the Cannabis Industry Conference featured a highly anticipated “Fireside Chat,” with Commissioner Steven Hoffman, Chairman of the Massachusetts Cannabis Control Commission, in an exclusive one-on-one Q&A with Frank A. Segall, co-chair of the Cannabis Business & Law Advisory Group at Burns & Levinson. After a rousing interview at last year’s conference, Segall and Hoffman followed up this year with a lively and wide-ranging interview that touched upon several hot-button issues regarding the cannabis industry in Massachusetts.
Despite the pandemic serving as a backdrop, the interview opened with the Commissioner offering positive news to potential cannabis license applicants and applications currently in process. Despite relegated to working remotely since early March, the Commissioner noted that the CCC has seen an uptick in productivity of license processing during this time. Since March, the Commission is averaging approximately 50 provisional licenses per month, increasing pre-pandemic numbers. Anecdotally, the Commissioner noted that the CCC had received fewer complaints regarding delays in the licensing process.
One source of frustration in the cannabis licensure process, according to the Commissioner, is the absence of a streamed process between cities/towns and the CCC. Under state law, applicants seeking cannabis business licenses must first enter into a host community agreement with a town or city before the CCC can consider a license application. Currently, the CCC does not have regulation and enforcement authority over municipalities and HCAs. The Commissioner pointed to proposed legislation that would grant the CCC authority to regulate and enforce HCAs. He expressed optimism that the legislation could provide much-needed clarification as to enforcement authority, which would make CCC’s enforcement responsibilities easier.
Attorney Segall and the Commissioner engaged in an interesting conversation about Governor Charlie Baker’s emergency order at the outset of the pandemic that rendered adult-use retail marijuana establishments as “non-essential” businesses. In response to a question by Attorney Segall about the position taken by Governor Baker, the Commissioner expressed that it’s not the CCC’s role to disagree with whether the Governor was right or wrong or had the authority to take this action. Instead, the Commissioner highlighted the fact that the cannabis industry has clearly illustrated it can operate safely under the circumstances. In the midst of the pandemic, the Commissioner expressed hope that the industry has displayed to Governor Baker that it can and will operate both medical and recreational cannabis businesses safely. He commended the resilience of the state’s retail operators, noting that all 44-45 operators successfully emerged from the shutdown and still remain open.
The interview also touched upon the proposed delivery license regulations, which had been scheduled for a vote on the same date as the conference. The proposed delivery framework would provide a period of exclusivity for participants in its Social Equity Program and certified economic empowerment applicants. Calling the proposed regulations “unprecedented” in any state, the Commissioner underscored the importance of advancing social equity in the industry.
The Commissioner described the rationale for delaying the final vote on the proposed regulations, which were postponed until November 30th. Acknowledging that this is a complex matter, Commissioner Hoffman expressed the importance of continuing to hear from constituents and afford people more time to comment and allow the CCC to listen in the spirit of openness and transparency. The Commissioner noted the CCC has been meeting with constituencies on all sides on this issue and intends to continue to do so.
The fireside chat concluded with a discussion of capital availability in the industry. The Commissioner said he is proud of the progress the industry has made, but the single most significant difficulty faced by the industry is concerning available funding, particularly for social equity and economic empowerment applicants. He indicated that he would continue to explore various existing and novel approaches to address this issue in the ever-changing and rapidly-growing cannabis industry.
Interviewer: Frank A. Segall
Steven Hoffman / Chairman, Massachusetts Cannabis Control Commission