MMA webinar reviews newly promulgated CCC regulations

An MMA webinar today with attorney Nicole Costanzo of KP Law discussed the Cannabis Control Commission’s recently promulgated regulations and their impact on host communities.

Costanzo began by reviewing how host community agreements — both new and pre-existing ones — will be affected by the new regulations when they take effect on March 1, 2024. In the spring, the CCC will review host community agreements, or HCAs, to determine compliance with the new regulatory requirements and social equity mandates.

Under the new regulations, HCAs must satisfy certain “minimum acceptable requirements.” For instance, no host community may impose an unreasonable condition or a term that is “unreasonably impracticable” in an HCA. HCAs must also include a statement of all stipulated responsibilities between a host community and a marijuana establishment.

Regarding a host community’s assessment of community impact fees, HCAs must include “clear, specific terms,” such as the certified business name of the licensee, the specific type of marijuana operations permitted, and the duration of the HCA.

Several terms, conditions and clauses are now prohibited in an HCA, including provisions that require upfront payments or impose legal, overtime, administrative, or any costs other than a community impact fee.

“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,” Costanzo said. “A contractual financial obligation, other than a [community impact fee], that is explicitly or implicitly a factor considered in or included as a condition of an HCA is unenforceable.”

The recent regulations allow host communities to discontinue relations, although marijuana establishments may submit a request for equitable relief to the CCC. If the CCC grants or denies equitable relief to a marijuana establishment, it will provide notice of its decision to a marijuana establishment and a host community.

Costanzo concluded by reviewing the mandatory practices to promote and encourage full equity participation. Host communities must publicize certain information in conspicuous locations, explain the reasoning for the approval or denial of an application, and develop an equity plan to promote and encourage full participation.

MMA Legislative Analyst Ali DiMatteo moderated 25 minutes of questions and answers, which addressed inquiries about cannabis cafes, retail operation limits, charitable funding provisions, and amending bylaws to limit licenses.

• Cannabis Compliance: Host Community Agreements and Social Equity Requirements presentation (737K PDF)