Page 11 - BusinessWest September 19, 2022

Cannabis
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Growing Pains
The law makes other major changes as well, including a clarification of the local social-con- sumption approval process.
The advent of what’s known as cannabis cafés will give renters, public housing tenants, and
ated Cannabis Social Equity Advisory Board. “This legislation will create a more equitable cannabis industry in the Commonwealth,” said state Sen. Jo Comerford, noting that lawmakers “approached this issue with expertise and com-
passion, and the resulting bill will bring more diversity and equity to this industry.”
and property owners. “That’s challenging from a real-estate standpoint. If that were to change, it would provide a more stabilized financial under- pinning for the industry itself, and obviously, that would translate into folks that have space feel- ing far more comfortable in terms of the security they have relative to leasing and everything else. It would be accepted in the mainstream financial market.”
While Springfield didn’t embrace cannabis in the unfettered way Holyoke did — the city has put forward two rounds of retail applications and one for a grow facility, but that project, by Page Cultivate LLC in East Springfield, was derailed by the City Council in May over a site-plan change and other concerns — many of its leaders rec- ognize the economic value of the burgeoning industry.
“Once it was legalized, there was clearly a focus on it becoming an economic benefit for the city,” Sheehan said. “Much like when gaming was legalized, we looked to see what the economic potential of the cannabis industry would be rela- tive to both city finances and economic impact in terms of the marketplace.
“Obviously, the industry has had an impact on storefront and warehouse space, and I would quantify that as a positive impact,” he went on, adding that it remains to be seen what kind of impact the cannabis trade will have on the sur- rounding residential real-estate market.
“Caution is the watchword. As an industry, it
Cannabis
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“Much like when gaming was legalized, we looked to see what the economic potential of the cannabis industry would be relative to both city finances and economic impact in terms of the marketplace.”
tourists a legal place to use a legal substance. Under this legislation, a city or town may allow for social consumption sites through the passage of a bylaw or ordinance.
The legislation also creates a trust fund to make grants and loans to social-equity program participants and economic-empowerment prior- ity applicants, which will give entrepreneurs from communities that have been disproportionately harmed by marijuana prohibition and enforce- ment better access to grants and loans to get their businesses off the ground.
In addition, 15% of the revenue collected from the sale of marijuana and marijuana prod- ucts must be transferred to the Cannabis Social Equity Trust Fund, which will be administered by the Executive Office of Housing and Economic Development in consultation with a newly cre-
House Speaker Ronald Mariano added that “the passage of this legislation will help to ensure that those who have been historically impacted by marijuana prohibition can find new opportu- nity in the emerging industry. This legislation will help to support folks who have faced generations of inequality secure the needed capital to launch a cannabis business.”
The loan fund highlights one of the challenges of starting a business that’s technically illegal under federal law. Although there have been rumblings that the U.S. Congress could move to decriminalize cannabis and open up traditional financing to such businesses, nothing has been done so far.
“It’s still a hard-money business,” said Tim Sheehan, chief Development officer for the city of Springfield, and that affects both entrepreneurs
Michael Lynch
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Henry "Hank" Joe Doug Downey Kulig Gilbert
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