Business Monday: New rules for cannabis home delivery spark opposing reactions among local …

On November 30, the Massachusetts Cannabis Control Commission (CCC) approved new regulations for home delivery, which will now allow state residents to buy adult-use marijuana without ever having to leave their homes.

However, many dispensaries across the state reacted angrily to the news, and the Commonwealth Dispensary Association (CDA) indicated that it will challenge the new regulations in court. Conversations with retailers in Berkshire County show the complexity of reactions to the issue.

Two important local dispensaries – Canna Provisions and The Pass — are not members of the CDA. Canna Provisions COO and co-founder Erik Williams explained that they see the proposed changes as a big step forward for the industry. “We are not part of the group suing over the changes and are disgusted and perplexed by those who are,” Williams said.

The source of the controversy was the decision by the CCC not to allow brick-and-mortar dispensaries to make their own deliveries for three years, until 2024. In the meantime, the new regulations create two classes of adult-use marijuana delivery licenses — so-called “marijuana couriers” and “marijuana delivery operators.” Marijuana courier license-holders will be allowed to deliver cannabis products to consumers from a retail dispensary for a fee. The more controversial marijuana delivery operators will be allowed to buy wholesale cannabis products from cultivators and make deliveries from their own warehouse without having to operate a retail storefront.

Theory Wellness in Great Barrington has set up a physically distanced tent for customers to pay for pre-orders. Photo: Terry Cowgill

A key factor in the development of these new license types was the desire to increase access to and ownership of the industry by minorities. For three years, the two license types will be available only to social equity and economic empowerment applicants.

“These regulations are a major step towards the equitable cannabis industry that was envisioned by voters and lawmakers when they established the adult-use cannabis market in Massachusetts,” said David O’Brien, the president of the Massachusetts Cannabis Business Association, which represents a wide swath of the industry players.

“Since 2018 alone, the retail cannabis industry has generated over one billion dollars in revenue, but entrepreneurs with limited access to start-up capital, especially Black and Latino entrepreneurs and those who have been harmed by the failed war on drugs, have been largely shut out of this fast-growing market,” O’Brien explained. “These regulations will open the door.”

Efforts to make the industry more diverse win approval from Canna’s Williams, but he hopes that more will be done. “We are happy that the rules and regulations have been passed to allow two different types of delivery models,” Williams said. “We are also generally concerned that this would signal that the work for a socially equitable cannabis industry is done — and that is far from the case.”

Williams also wonders if the delivery-only business model is viable in the real world. “The more diversity in the types of licenses, the more diverse the opportunities for businesses,” Williams said.

“We are generally concerned, however, that this model is only a pipe dream and not a viable or profitable business model without minimum delivery orders or large delivery fees. It seems to us that ideals behind making this a social equity and economic empowerment program that couldn’t serve many in those communities is counter-productive.”

That being said he is excited to find a delivery company to partner with as soon as possible. “We believe that this will impact our business positively as we expect to work closely with licensees to add another level of convenience and choice to our customers,” Williams said.

“To be clear, no one opposes equity,” said the Commonwealth Dispensary Association in a statement issued the same day the new regulations were announced. The CDA represents 80 percent of the medical and adult-use marijuana market.

Pastel colors are the order of the day for products from The Pass in Sheffield. Photo courtesy Berkshire Welco

Theory Wellness and Berkshire Roots are members of the CDA, which will likely bring a lawsuit on their behalf. Brandon Pollock, co-founder and CEO of Theory Wellness, agreed that offering the service will be great, but he expresses concern that the program will not work as the state hopes. He fears that “well-capitalized individuals” would still seek “to take as much market share as possible.”

The battle over delivery is far from over.

“Unfortunately, some have effectively framed this discussion as a means to distract from the very real, numerous, and unfortunate consequences this new policy will have for our small businesses, communities, and most importantly, for the very people this policy purports to support,” the group said, adding that the “unfortunate reality” was that the new delivery licenses would not actually boost participation in the state’s equity programs “due to the capital and technology required to operate as an online retailer.”

CCC Chairman Steven Hoffman downplayed the possibility that legal challenges from the CDA could ensnare the CCC’s decision. “That’s certainly their prerogative to do so. We made what we thought was the right decision, one that we stand by,” Hoffman said before adding that the group is ready to fend off any legal challenges.

Latest posts