How to open a dispensary in Massachusetts

Overview

Are you wondering how to open a cannabis dispensary in Massachusetts? This page is intended to keep you up to date on the latest news and information relevant to opening a cannabis business in Massachusetts. This includes helpful insights on what is next to come for the state.

In Massachusetts, both medicinal and recreational marijuana are legal. The plant was controlled, taxed, and made accessible for legal sale by licensed shops in November 2018. Just 3.5 years after the first dispensary opened in the state, recreational marijuana sales in Massachusetts are quickly surpassing $3 billion. On May 14th, 2022, the total gross sales of recreational marijuana in the state of Massachusetts hit $3,001,846,490. This included sales from 216 cannabis retail locations and 11 delivery services.

On August 11th, S. 3096, An Act Relative to Equity in the Cannabis Industry was signed into law by Governor Charlie Baker. This measure represented the most significant change to the state’s cannabis laws to have been proposed since 2017. Under the law, 

  • Massachusetts has formally decoupled from Internal Revenue Code Section 280E, a federal provision prohibiting enterprises that deal in schedule 1 or 2 restricted drugs from deducting ordinary and necessary business costs on their income tax returns. The decoupling of cannabis businesses from 280E will result in considerable tax savings for such businesses.
  • A new social equity trust fund has been established, to be funded with 15% of recreational marijuana tax revenue. It would give grants and loans to businesses from areas affected by the war on drugs to aid with startup expenses. 
  • It would also allow cities and municipalities to ask voters whether they want social consumption places through ballot questions.

We anticipate that further information about legalization, regulations, and applications will soon become available. As new information becomes available, we will update this page to provide the most up-to-date information. Here’s what you need to know right now.

The Opportunity Size

After getting off to a sluggish start in 2018, sales of recreational marijuana in Massachusetts are rising, and they are on track to reach up to $2.6 billion by the year 2025, according to MJBizDaily

Local Cannabis Restrictions & Laws

When searching for a place to launch a cannabis business in the state of Massachusetts, one of the most crucial factors to take into account is location. There are several local communities or cities whose officials have made the decision to outright prohibit or severely limit the use of marijuana.

You may examine the current state of municipal zoning and ordinances for each city or town by using the Municipal Tracker provided by the CCC. The Municipal Tracker provides information on the zoning and bylaws pertaining to adult-use marijuana for each of Massachusetts’ 351 cities and towns.

Medical Marijuana

On November 6, 2012, voters in Massachusetts gave Question 3, the Massachusetts Medical Marijuana Initiative, its approval by a majority of 63%. When the legislation went into effect on January 1, 2013, it removed criminal and civil sanctions for the possession and use of up to a 60-day supply of marijuana by patients who had a registration card. Non-profit dispensaries that have been granted a license by the state are legal under the law.

Patients suffering from cancer, HIV/AIDS, glaucoma, and several other medical illnesses are eligible to acquire a registration card if a physician recommends it. As of September 2022, there are approximately 100,000 people registered to use medicinal marijuana in the Commonwealth of Massachusetts.

Medical Marijuana Treatment Center

Formerly known as Registered Marijuana Dispensaries, Medical Marijuana Treatment Centers (MTC) are vertically integrated businesses that cultivate, process, and retail their own medical cannabis and cannabis products. MTCs are permitted to distribute cannabis and cannabis-related items to registered patients.

To open a medical marijuana treatment center in Massachusetts, there is a license application fee of $3,500 and a license fee of $50,000.

As of September 2022, 98 medical-use business licenses are operational across the Commonwealth. 

Recreational Use Legalization

On November 8th, 2016, Massachusetts residents voted in favor of Question 4 to repeal cannabis prohibition for anyone aged 21 and over. Accordingly, on December 15, 2016, the cultivation and possession of cannabis by adults were each made legal in the Commonwealth of Massachusetts.

On November 20th, 2018, the first sales of cannabis to adults took place in two retail locations that had been granted the appropriate licensing.

Adult-Use Cannabis License Types

As of September 2022, there are a total of 1,155 Marijuana Establishments that have been granted licenses by the Cannabis Control Commission. A Marijuana Establishment (ME) can be a: 

  • Retailer
  • Microbusiness
  • Cultivator
  • Manufacturer
  • Social Consumption Establishment
  • Craft Marijuana Cooperative
  • Transporter
  • Courier
  • Delivery Operator
  • Independent Testing Laboratory
  • Standards Laboratory
  • Research Facility
  • or any CCC-licensed establishment catering to adults, with the exception of MTCs.

Since the first two marijuana retailers opened their doors in 2018, 235 more have received notifications from the Commission to initiate operations statewide and are now in the process of opening their doors to customers. Another 166 have been granted provisional or final license approval for marijuana retailer licenses and are finishing up the inspection and compliance processes required by the Commission. 

How much does it cost to open a dispensary in Massachusetts?

The cost of opening a dispensary in Massachusetts includes an application fee of $1,500 and an annual dispensary license fee of $10,000. For microbusinesses, there is no application fee, and the annual license fee is 50% of all applicable license fees.

How to get a cannabis business license in Massachusetts

Here is an overview of the licensing process taken from the Guidance on Licensure.

  1. Research the laws and regulations regulating adult-use or medical-use marijuana to learn more about the regulatory requirements for obtaining a license in the city or municipality in which you want to do business.
  2. Begin studying and creating your business’ operational plans. All proposals must adhere to adult-use or medical-use rules.
  3. Collect information about the individuals and companies that will be mentioned on the license and who will govern the company.
  4. Host a community outreach meeting and collaborate with the local government to draft the needed Host Community Agreement.
  5. Submit an online application with the required licensing and background check fees. Access the Massachusetts Cannabis Industry Portal (MassCIP) to start the application process.
  6. The Commission will evaluate the application according to its priority level and submission date. The applicant will be contacted by email when the Commission has reviewed the application.
  7. The next inspection will be made just before the doors open. When the report from the inspection is reviewed, your company will be given the green light to open for business.

Due to what has been an unprecedented year for Massachusetts, events are continuously unfolding that will affect when and how recreational legalization will happen. By adding yourself to our Massachusetts Cannabis Mailing List (below), we will keep you updated on how to open a dispensary in Massachusetts and all relevant news, including news that is not so easy to find, and comments based on Massachusetts Legalization below.

This includes but is not limited to

  • What are the latest updates with recreational cannabis business opportunities in Massachusetts?
  • Will there be any special programs available for residents to open their own cannabis businesses?
  • And more 

 

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