Code of Massachusetts Regulations › 935 CMR - Cannabis Control Commission › Title 935 CMR 500.000 - Adult Use of Marijuana › Section 500.180 - Host Community Agreement Requirements for License Applicants, Marijuana Establishments, and Host Communities

Current through Register 1525, July 5, 2024
(1)
								935
			 CMR 500.180 is governed by M.G.L. c. 94G
			 § 3 (d)(1)-(5), as amended by St. 2022, c. 180 which went into effect on
			 November 9, 2022. Pursuant to M.G.L. c. 94G § 4(a), the Commission is
			 authorized to review, regulate, enforce, and approve HCAs and to develop a
			 Model Host Community Agreement.
(2)
General Requirements for Host Community Agreements
.
			 The Commission shall review and approve each HCA as part of a completed License
			 application and at each License renewal. The parties to an HCA relative to an
			 application for licensure are a License Applicant and a Host Community. The
			 parties to an HCA relative to an application for renewal of licensure are a
			 Host Community and a Marijuana Establishment.
(a) A License Applicant seeking a new License
			 to operate a Marijuana Establishment or MTC shall negotiate and execute a
			 compliant HCA with a Host Community, unless a compliant HCA Waiver has been
			 submitted pursuant to
			 935
			 CMR 500.180(5). A compliant
			 HCA or compliant HCA Waiver must be submitted in order for a License
			 application to be deemed complete pursuant to
			 935
			 CMR 500.102.
(b) A Marijuana Establishment seeking renewal
			 of a License to continue to operate in a Host Community shall have an HCA that
			 complies with
			 935
			 CMR 500.180 unless a compliant HCA Waiver has
			 been submitted pursuant to
			 935
			 CMR 500.180(5).
(c) An HCA submitted by a License Applicant
			 or Marijuana Establishment which is determined to conform with the Model Host
			 Community Agreement will be presumed compliant for purposes of this
			 section.
(d) A Host Community shall
			 negotiate the terms of an HCA in good faith.
(e) Each of the parties shall ensure that
			 HCAs satisfy the following minimum acceptable requirements:
1. The parties shall ensure that references
			 in an HCA to a License Applicant or Marijuana Establishment are consistent with
			 both the business entity name certified and recorded with the Secretary of the
			 Commonwealth and the business entity name stated either in a License
			 Applicant's license application or on a Marijuana Establishment's license
			 record as maintained by the Commission.
2. The parties shall ensure that HCAs set
			 forth all of a Host Community's conditions for allowing a Marijuana
			 Establishment or a License Applicant to operate in the community. A Host
			 Community may not contract for any purpose, on any terms, or under any
			 conditions inconsistent with any applicable provision of Massachusetts General
			 Laws. No Host Community may impose an unreasonable condition or a term that is
			 Unreasonably Impracticable in an HCA. A condition may be presumed reasonable
			 if:
a. The condition is required under a Host
			 Community's local rules, regulations, ordinances, or bylaws;
b. The condition has been deemed necessary to
			 ensure public safety and proposed by the chief law enforcement authority and/or
			 fire protection chief in a Host Community with explanation and detail why the
			 condition is necessary for public safety.
c. The condition has been deemed necessary to
			 ensure public health and proposed by the chief public health authority in a
			 Host Community with explanation and detail why the condition is necessary for
			 public health.
d. The condition is
			 a local requirement customarily imposed by a Host Community on other,
			 non-cannabis businesses operating in the community;
e. The condition is required by
			 law;
f. The condition does not
			 conflict with other laws; or
g.
			 The condition is otherwise deemed reasonable by the Commission based on
			 particular circumstances presented by an HCA or contracting
			 parties.
3. The parties
			 shall ensure that HCAs include a statement of all stipulated responsibilities
			 between a Host Community and a License Applicant or between a Host Community
			 and a Marijuana Establishment including, but not limited to, the following:
a. A provision requiring a Host Community to
			 annually transmit its invoice of claimed impact fees to a Marijuana
			 Establishment within one month of the anniversary of the date a Marijuana
			 Establishment received final licensure;
b. A provision explicitly identifying any
			 generally occurring fees to be charged by a Host Community. Generally occurring
			 fees are customarily imposed on other non-cannabis businesses operating in a
			 Host Community and shall not be considered a CIF (
e.g
.,
			 routine water, property tax, sewer, trash pickup
etc
.).
4. The parties shall ensure that HCAs include
			 the following information:
a. The specific
			 Marijuana Establishment license operations permitted under the terms of the
			 HCA;
b. The name, signature, and
			 title of the individual(s) authorized to enter into HCAs on behalf of a Host
			 Community as a contracting authority;
c. The name, signature, and title of the
			 individual(s) authorized to enter into HCAs on behalf of a License Applicant or
			 a Marijuana Establishment as an authorized representative;
d. The date(s) of execution by both
			 parties;
e. The effective date of
			 an HCA; and
f. The duration of an
			 HCA.
5. The parties shall
			 ensure that HCAs provide clear, specific terms regarding a Host Community's
			 assessment of a CIF if applicable, including, but not limited to, a provision
			 requiring a Host Community to transmit its invoice of claimed impact fees to a
			 Marijuana Establishment within one month of the anniversary of a Marijuana
			 Establishment's final license date.
(f) The parties may include a clause in an
			 HCA whereby the parties voluntarily agree to bring HCA disputes before a
			 private mediator retained by the parties. Neither party may unilaterally compel
			 private mediation.
(g) Approval of
			 HCAs may be conditioned on a Host Community being in good compliance standing
			 with the Commission relative to any HCA to which the Host Community is a
			 contracting party.
(h) The
			 Commission may deem a provision of an HCA invalid, and therefore unenforceable,
			 based on a finding that the provision violates M.G.L. c. 94G,
			 935 CMR
			 500.000 or
			 935 CMR
			 501.000:
Medical Use of Marijuana
.
			 The Commission may also declare an HCA or a provision of an HCA voidable upon
			 deeming the HCA as a contract of adhesion.
(i) The Commission may decline to approve an
			 HCA on the basis of any other ground that serves the purposes of M.G.L. c. 94G,
			 935 CMR
			 500.000, or
			 935 CMR
			 501.000:
Medical Use of
			 Marijuana
.
(j) A Marijuana
			 Establishment that seeks a name change pursuant to
			 935
			 CMR 500.104(1) after
			 execution of an HCA must provide notice of the change to the Host Community in
			 a form and manner determined by the Commission. A Marijuana Establishment that
			 seeks a location change to another Host Community shall submit a new HCA to the
			 Commission. A Marijuana Establishment that seeks a location change within the
			 same Host Community after execution of an HCA may be required to provide an
			 amended HCA to the Commission. A Marijuana Establishment that submits a Change
			 of Ownership request for the transfer of a license may be required to submit a
			 new or amended HCA to the Commission.
(k)
Prohibitions
.
1. No License Applicant, Marijuana
			 Establishment, or Host Community shall enter into an HCA that includes a
			 promise to make a future monetary payment, in-kind contribution, or charitable
			 contribution. A License Applicant or Marijuana Establishment may voluntarily
			 provide organizations with monetary payments, in-kind contributions and
			 charitable contributions after executing an HCA, as long as a License Applicant
			 or Marijuana Establishment's actions are not performed because of a condition
			 imposed by a Host Community, whether explicitly or implicitly.
2. A contractual financial obligation, other
			 than a CIF, that is explicitly or implicitly a factor considered in or included
			 as a condition of an HCA is unenforceable, subject to the following exceptions:
a. References in an HCA to a Marijuana
			 Establishment's obligations to pay any fees associated with sales tax, excise
			 tax on Marijuana and Marijuana Products, optional local tax, or as otherwise
			 provided in M.G.L. c. 94G, M.G.L. c. 64H, and M.G.L. c. 64N.
b. References in an HCA to a Marijuana
			 Establishment's obligations to pay a Host Community for generally occurring
			 fees associated with operating in a Host Community (
e.g
.,
			 water, sewer, property tax,
etc
.).
3. No Host Community may mandate or otherwise
			 require that the CIF be a certain percentage of a Marijuana Establishment's
			 total or gross sales as a term or condition of an HCA.
4. A Host Community shall not demand a CIF
			 exceeding 3% of the gross sales of a Marijuana Establishment as a term or
			 condition of an HCA.
5. No License
			 Applicant, Marijuana Establishment, or Host Community will use Inducements to
			 negotiate or execute an HCA. No municipality or Host Community shall negotiate
			 or renegotiate an HCA through the use of undue influence, duress, coercion,
			 intimidation, threats, or any strong-arm tactics including by threat of
			 dissolution of the HCA.
6. No Host
			 Community may rely on other written instruments, contracts, or agreements to
			 impose terms or conditions on a License Applicant, Marijuana Establishment, or
			 Medical Marijuana Treatment Center outside of an HCA.
(l) The following terms, conditions, or
			 clauses are prohibited in an HCA:
1. A
			 provision that discourages any party from bringing a civil cause of action or
			 other legal challenge relative to an HCA or to an individual term or provision
			 of an HCA;
2. A provision that
			 requires a License Applicant or Marijuana Establishment to make upfront
			 payments as a condition for operating in the Host Community;
3. A provision that affords a Host Community
			 sole and absolute discretion on how a Host Community will spend a
			 CIF;
4. A provision waiving a
			 Marijuana Establishment's ability to dispute whether impact fees claimed by a
			 Host Community are Reasonably Related and properly due and payable as a
			 CIF;
5. A provision that
			 categorically deems a Host Community's claimed impact fees to be reasonably
			 related or that otherwise excuse a Host Community from calculating impact fees
			 based on the actual operations of a Marijuana Establishment;
6. A provision that imposes legal, overtime,
			 or administrative costs or any costs other than a CIF on a Marijuana
			 Establishment with the exception of a Marijuana Establishment's tax obligations
			 or its responsibility for paying routine, generally occurring municipal
			 fees;
7. A provision that obligates
			 a Marijuana Establishment to set aside money in an escrow, bond, or other
			 similar account for a Host Community's use or purposes;
8. A provision that requires a Marijuana
			 Establishment to make any additional payments or obligations including but not
			 limited to monetary payments, in-kind contributions, providing staffing,
			 advance payments, or charitable contributions by a Marijuana Establishment to a
			 Host Community or any other organization.
9. A provision including or otherwise deeming
			 good faith estimates, unquantifiable costs, generalized expenses, or pro-rated
			 expenses as a CIF.