Cannabis Is an Economic Bright Spot
In the 21 months since recreational marijuana became legal in Massachusetts, the industry has raked in about $150 million in tax revenue for state and local coffers.
Of that, $30 million — about 20% of the total — has poured in just since Memorial Day, when the state ended several weeks of COVID-19 restrictions on dispensaries as part of its reopening plan.
Talk about pent-up demand.
And talk about an opportunity.
In our cover story this month, Marcos Marrero, Holyoke’s director of Planning & Economic Development, drew a comparison between current demand for cannabis with the lifting of prohibition during the Great Depression. Though times were still tough, alcohol sales surged, and have rarely let up since.
In short, some industries are more resilient amid shifting economic tides than others, and cannabis — judging by these latest tax-revenue numbers, and by the customer lines outside dispensaries even as more competition springs up around the region — may be one of them.
Indeed, cannabis sales in the Bay State have totaled $785 million since November 2018, when adult use became legal here. The tax rate in the state is 6.25%, with a 10.75% excise and a 3% local tax in most areas. It adds up.
“This tax-revenue milestone is a big moment for the Massachusetts cannabis business community because it shows not only the great demand for safe, regulated cannabis, but also affirms the meaningful value this industry brings to cities and towns every single day,” David Torrisi, president of the Commonwealth Dispendary Assoc., noted in a statement following the news.
“We know the hardship that COVID-19 has imposed on local and state budgets,” he added, “and we are proud to help provide steady revenue streams that can hopefully reduce the need for difficult choices and maintain services.”
Such talk cheers Marrero and other municipal officials in Holyoke, the city that, more than any other in the region, has fully embraced the economic potential of cannabis, with a few businesses already open and many more in the pipeline.
And it’s not just tax revenue, although that is critical right now. It’s also jobs and business growth — both in new and growing enterprises that grow, manufacture, and sell cannabis products, and at companies that provide services to those entities, whether legal, security, maintenance … the list goes on.
It’s what Marrero called “economic contagion,” a positive and kind of delightful use of that latter word during this time of pandemic. Holyoke wants to create a cannabis cluster that will boost the entire city’s — and region’s — economy, and other communities might take heed of the lessons learned so far.
The main one is that cannabis appears to be a hardy sector, no matter what the broader economic conditions are. At a time when communities are looking for bright spots, this one ranks high on the list.