AMESBURY — The city is offering a break to its cannabis businesses, and at least one has paid the kindness forward.
The city counts five cannabis retail or cultivation facilities either in development or operation. CNA Stores and Alternative Therapies Group Inc. both own retail shops and CNA Stores and Jamaco LLC have plans for cultivation facilities as well.
Alternative Therapies Group Inc. opened its retail location on Route 110 in January 2020, just weeks before the COVID-19 pandemic began, and CNA Stores opened its Route 110 retail location in January 2021.
Cannabis-related businesses in Massachusetts typically sign a host community agreement with municipalities. Host community agreements often include the company paying 2 to 3% of its annual gross sales revenue to the municipality as well as a 2 to 3% community impact fee to pay for potential negative effects to services brought on by the new businesses.
Host community agreements – and the community impact fees, in particular – have not been well-received. Lee and Northampton are two Massachusetts municipalities that have waived their community impact fees and the owner of the Haverhill retail cannabis store Stem has sued that city for failing to provide documentation of costs incurred.
Mayor Kassandra Gove made the decision to suspend the city’s community impact fees until further notice late last month.
“These funds have never been collected, this would have been the first time,” Gove said in an email. “So this isn’t revenue we’re losing, it’s revenue that’s just not being added right now. Our cannabis businesses just got started before the pandemic and these funds can now be utilized to support their operations and staff.”
Many other businesses were, of course, also closed for a good part of the opening stages of the pandemic. Gove said cannabis-related businesses are also unable to take part in many grant programs.
“They can’t take federal funds, they weren’t open in time to receive our (Community Development Block Grant) funding, etc.,” Gove said. “So while many of our other businesses could take advantage of federal grant programs and our own CDBG grant program, these businesses could not.”
Gove added that the city also receives a 3% excise tax from its cannabis businesses, which accounted for $620,210 in fiscal 2021 and $237,531 so far in fiscal 2022.
Rob DiFazio, CEO of CNA Stores, said waiving the community impact fee was a great move by the city.
“Working with cities and towns, like we did with Mayor Gove, and having an open line of communication is key,” DiFazio said. “This is new to everyone, even myself. So working through that process is important.”
DiFazio said he and his company would much prefer finding their own ways to give back to the community and have donated $161,202 to Haverhill-based Veterans Northeast Outreach Center, which works to end veteran homelessness in New England.
“We’re trying to find creative ways to help the cities use these funds that are beneficial to everybody,” DiFazio said. “If we can make a positive impact on our city, then that is something I would like to do.”
Transparency is very important when dealing with government, according to DiFazio.
“I look at this as a fee that we agreed to pay if we cause an impact,” DiFazio said. “That is the key thing. Some people in some places look at it as the money that we have to pay. No matter what, that will be thrown into the general fund and used whenever necessary.”
DiFazio continued to say that he is dubious of some municipalities that have claimed they have had to hire more police officers to handle marijuana-related issues.
“When you do the research about how many people were arrested in that city, you may see something like four people arrested on offenses related to marijuana and two of those offenses were the same person,” DiFazio said. “I don’t think you have to hire six new cops to deal with four offenses.”
Staff writer Jim Sullivan covers Amesbury and Salisbury for The Daily News. He can be reached via email at jsullivan@newburyportnews.com or by phone at 978-961-3145. Follow him on Twitter @ndnsully.
Staff writer Jim Sullivan covers Amesbury and Salisbury for The Daily News. He can be reached via email at jsullivan@newburyportnews.com or by phone at 978-961-3145. Follow him on Twitter @ndnsully.
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