The growing number of Massachusetts communities that forbid marijuana businesses troubles marijuana advocates, and it should trouble state policy makers too. But the solution is not to punish those towns by taking away their share of pot tax revenues, as some critics demand. Lawmakers ought to strengthen the carrot offered to towns before they even think about resorting to sticks.
After last year’s successful ballot measure to legalize recreational marijuana at the state level, more than 100 municipalities have responded with permanent or temporary bans, or tight restrictions on retail sales. Some of those towns opposed legalization in November. But many towns whose voters approved sales don’t want them in their backyard. Last month, for instance, Milford voters nixed commercial marijuana after voting for legalization last year.
If too many towns opt out, it’ll make it harder to stamp out the black market — one of the goals of legalization. It will extinguish business opportunities for entrepreneurs. And it may result in pot businesses clustering in poorer communities: Wealthier towns have been first in line to ban pot retail.
But the marijuana advocates asked for this. It was their ballot proposal, after all, that offered communities the prospect of having it both ways. Voters were specifically reassured that they could opt out, and no mention was ever made of fiscal consequences if they did. Towns that disallow commercial marijuana should still get their share of the state tax revenues from pot, just as every Massachusetts municipality is getting a benefit from casino gambling even though some of them specifically rejected casinos of their own.
Rather than punishing opt-out municipalities, the ballot measure relied on inducements for communities. The ballot proposal allowed towns that permitted marijuana to tack on an extra 2 percent local tax, a figure the Legislature recently upped to 3 percent.
That’s still the soundest approach. Over time, towns may find it harder and harder to resist the lure of that extra revenue. Prohibiting pot shops might be the politically expedient course now, but when the choice is between cutting school budgets or allowing a pot retailer, towns might have to reconsider. And if the problem of widespread opt-outs persists, the Legislature should sweeten the deal by raising the local option to a higher rate.
After all, the Legislature has already tweaked elements of the pot law, and lawmakers shouldn’t treat the exact tax rate as written in stone. Lawmakers made what was at best an educated guess about the right tax rate, which currently maxes out at 20 percent, and they should be ready to adjust it again if needed.
The high number of opt-out municipalities is hardly the only growing pain in the nascent Massachusetts pot industry. The newly formed Cannabis Control Commission is confronting several novel problems, including uncertainty over how marijuana business can operate on Nantucket or Martha’s Vineyard, since it’s illegal to transport marijuana by air or sea.
Working through those challenges should be the state’s top priority now. And it also might be the best way to change skeptical minds at the municipal level: The smoother the rollout of the pot law goes, the more likely towns and cities are to drop their opposition to commercial marijuana.