Code of Massachusetts Regulations › 935 CMR - Cannabis Control Commission › Title 935 CMR 501.000 - Medical Use Marijuana › Section 501.180 - Host Community Agreement Requirements for License Applicants, MTCs, and Host Communities

Current through Register 1525, July 5, 2024
(1)
								935
			 CMR 501.180 is governed by M.G.L. c. 94G
			 § 3(d)(1) through (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 an MTC.
(a) A License Applicant seeking a new License
			 to operate an MTC shall negotiate and execute a compliant HCA with a Host
			 Community, unless a compliant HCA Waiver has been submitted pursuant to
			 935
			 CMR 501.180(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 501.102.
(b) An MTC seeking renewal of a License to
			 continue to operate in a Host Community shall have an HCA that complies with
			 935
			 CMR 501.180 unless a compliant HCA Waiver has
			 been submitted pursuant to
			 935
			 CMR 501.180(5).
(c) An HCA submitted by a License Applicant
			 or Medical Marijuana Treatment Center 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 MTC 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 an MTC'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 an
			 MTC 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 an MTC including, but not
			 limited to, the following:
a. A provision
			 requiring a Host Community to annually transmit its invoice of claimed impact
			 fees to an MTC within one month of the anniversary of the date an MTC 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 MTC
			 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 an MTC 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 an MTC within one
			 month of the anniversary of an MTC'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:
Adult Use of Marijuana
or
			 935 CMR
			 501.000. 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. cc. 94G and 94I,
			 935 CMR
			 500.000, or
			 935 CMR
			 501.000.
(j) An MTC that seeks a name change pursuant
			 to 935 CMR 501.104(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. An MTC that seeks a location change to another Host Community
			 shall submit a new HCA to the Commission. An MTC 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. An MTC 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, MTC, 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 MTC may voluntarily provide organizations with monetary payments,
			 in-kind contributions and charitable contributions after executing an HCA, as
			 long as a License Applicant or MTC'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 an MTC'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 an
			 MTC'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 an MTC'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 an MTC as a term or condition of an
			 HCA.
5. No License Applicant, MTC,
			 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 MTC 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 an MTC'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 an MTC;
6. A provision that imposes legal, overtime,
			 or administrative costs or any costs other than a CIF on an MTC with the
			 exception of an MTC's tax obligations or its responsibility for paying routine,
			 generally occurring municipal fees;
7. A provision that obligates an MTC 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 an MTC 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 an MTC 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.