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Cannabis Bill Imperils Equity Progress: Lawyer
A major policy battle is brewing in Massachusetts over H. 4206, officially titled An Act Modernizing the Commonwealth's Cannabis Laws. The proposed cannabis bill is now before the Senate Ways and Means Committee, which, under newly adopted joint rules, must issue a final report within 60 days unless granted an additional 30-day extension.
For Adrienne D. Dean, a partner in the cannabis law practice at Cogent Law Group, the stakes could not be higher. She fears that if passed without revision, the cannabis bill could do "irreparable damage" to small and minority-owned cannabis businesses already struggling to survive in a competitive and volatile marketplace.
Among the bill's more controversial provisions is the proposal to raise the cap on dispensary licenses an entity can hold from three to six. Additionally, it would increase the allowable equity stake an investor can take without public disclosure from 10 percent to 34.99 percent. Dean argues that these changes could tilt the playing field heavily in favor of large, multi-state operators with deep pockets, effectively pushing out local "mom and pop" shops.
Supporters of the cannabis bill, including the Massachusetts Cannabis Coalition, counter that lifting the cap could give failing businesses a lifeline through acquisition by stronger companies. At an April hearing, industry leaders such as Tito Jackson of Apex Noire and Payton Shubrick of 6 Bricks voiced support, emphasizing that capital is hard to come by in the cannabis sector and that many owners have personally guaranteed loans.
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