Mass. towns rake in cannabis bucks

As the Catskill Town Board debates allowing cannabis dispensaries to open within town limits, two Massachusetts towns say that since 2019, legal dispensaries are creating a revenue windfall. Courtesy of Tribune News Service

CATSKILL — Over three fiscal years, the town of Great Barrington, Massachusetts, has garnered more than $6.7 million in sales tax revenue and community impact fees from cannabis sales, the town finance director told the Select Board on Aug. 23.

According to the U.S. Census Bureau, Great Barrington has a population of just under 7,000.

The town of Lee, Massachusetts, had its first cannabis retailer open in 2019, and in its first year of operation, it generated more than $494,000 for the town, which is 3% of its sales, the chief operating officer told the town board in July 2020.

A cannabis dispensary that opened in Massachusetts generates a great deal of revenue for the locality, Athens Village Trustee Nancy Poylo said.

“If you look at Great Barrington and you see what this one store has done for downtown Great Barrington, it’s incredible,” Poylo said. “It has brought in such an influx of people — there are more people shopping, dining, lunching.”

The Village of Athens has put together a committee to review the decision.

The Catskill Town Board plans to hold a public meeting to discuss opting in to permitting marijuana sales or to opt out.

The town has to make a decision by the end of the year, Supervisor Dale Finch said at the board meeting Tuesday.

Former Gov. Andrew Cuomo signed legislation March 31 legalizing recreational adult-use cannabis. There will be a 9% state excise tax imposed on marijuana sales and a 4% local tax. Counties will receive 25% of the local tax revenue and 75% will go to the city, town or village.

Municipalities can opt out of permitting cannabis sale sites. The deadline to opt out is Dec. 31.

To opt out of allowing adult-use cannabis retail dispensaries or on-site consumption licenses, a municipality must enact a local law by the December deadline.

If a municipality does not opt out by the December deadline, it will be unable to opt out in the future, but any municipality that has opted out by the December deadline may opt back in at any time to allow dispensaries or on-side consumption licences by repealing the local law which established the prohibition.

Under state law, county governments are not allowed to opt out. Only cities, towns and villages can.

The law also allows voters in a municipality to petition whether to approve the local law.

Finch said he didn’t think the town would see a lot of money from allowing dispensaries.

“You’re going to get 3% of the sales ... you still have to do a million in sales to get $30,000,” Finch said.

The move to legalize adult-use marijuana is projected to generate an additional $350 million in taxes annually and could potentially create 30,000 to 60,000 jobs across the state, according to the governor’s office.

Town Councilman Jared Giordiano said the opportunity to collect taxes is rare.

“That’s the one chance we have of getting money where the county doesn’t keep it,” he said.

For some municipalities considering the move, permitting it doesn’t guarantee additional revenue.

“All of this will depend on if we permit it, there has to be a business that wants to set up in the village,” Athens Village Trustee Joshua Lipsman said. “If they don’t set up in the village, there is no money. If they do, it will depend on how much business they do.”

Kinderhook Town Supervisor Patsy Leader said in July some town board members have talked about the issue in passing but the matter of opting out of sales has not been brought before the town board, She said she would be willing to discuss it with the board.

“I don’t know if there’s anyone willing to come here and do the business in the town of Kinderhook, but I’d hate to miss out on the sales tax revenue, because that does help the town and helps us take care of our infrastructure, so I’d hate to lose out on that,” Leader said.

Finch had some concerns about bringing more drugs to the Twin Counties as many struggle with addiction and many recovery centers are in the area. But Councilwoman Dawn Scannapieco said marijuana is different.

“I don’t know if they’re trying to get people off of marijuana,” Scannapieco said. “They’re probably trying to get people off of heroin and alcohol, which is legal.”

If the town decides to opt out, Finch said they could still opt in at a later time, but once people start establishing businesses, it would be difficult to change.

With the new law, Finch said he didn’t think marijuana would be in short supply.

“I think anybody in Catskill that wants marijuana is going to have it,” he said.

Scannapieco said dispensaries would provide a safer way to obtain marijuana.

Finch said it would be best to let the community weigh in.

“I think having an in-person (hearing) but giving people an opportunity to voice their opinion, especially if we’re going to consider opting out — I think it’s good. It’s good either way, people should let you know what their opinions are,” he said.

A date for a public meeting or hearing has not been set, the town clerk said.

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