935 CMR 501.180 Host Community Agreement Requirements For License Applicants, Mtcs, and Host Communities

• Library: Code of Massachusetts Regulations
• Edition: 2023
• Currency: Current through Register 1511, December 22, 2023
• Citation: 935 CMR 501.180
• Year: 2023

(1) 935 CMR 935 CMRundefined501.180 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 935 CMRundefined501.180(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 935 CMRundefined501.102.

(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 935 CMRundefined501.180 unless a compliant HCA Waiver has been submitted pursuant to 935 CMR 935 CMRundefined501.180(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 CMRundefined935 CMR 500.000: Adult Use of Marijuana or 935 CMRundefined935 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 CMRundefined935 CMR 500.000, or 935 CMRundefined935 CMR 501.000.

(j) An MTC that seeks a name change pursuant to 935 CMR 935 CMRundefined501.104(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...