Massachusetts is still open to businesses who want to obtain a medical cannabis business license, as the latest application window did not manage to issue all available permits. Candidates who wish to start a marijuana dispensary in Massachusetts will be reviewed on a first-come, first-served basis. There is no limit on the number of medical or recreational marijuana dispensaries allowed in the state.
As a result, profits of the marijuana industry are expected to increase dramatically by 2021. Experts say that the total revenue of the Massachusetts marijuana businesses will reach around $1 billion within five years.
When was cannabis made legal
Initially, legalization of cannabis in Massachusetts started in November 2012, when voters approved Question 3, making Massachusetts the 18th state to enact a compassionate medical marijuana program.
Opening a Massachusetts medical marijuana treatment center (dispensary) or becoming a cultivation facility producer (cultivation registration) was limited to 35 sites. Out of 35 available licenses, only 15 were actually awarded.
The state reopened the application submission process for the second time on June 29th, 2015 for non-profit organizations to apply for a Certificate of Registration to operate a Registered Marijuana Dispensary (RMD).
On November 8th, 2016, Massachusetts legalized recreational marijuana and became the first state on the East Coast to do so.
As of now, there is no deadline on the application process. The department will review applications on a first-come-first-served basis. Unlike other states, applicants are not scored but reviewed and awarded a license based on their compliance with Chapter 369 and the regulations.
Currently, there is no set limit on number of medical dispensaries allowed in the state of Massachusetts.
Number of dispensaries allowed
Medical: No limit. (12 open for sales. Just under 100 at earlier stages of application)
Recreational: 75 until October 1, 2018, with no limit after that. If a city or town decides to limit the number, the first licenses will go to experienced medical operators, followed by a lottery for the remaining spots if any. None have been issued so far.
How much money is there in the dispensary market
2016 Medical Sales amounted to $100,000,000, while this number is set to increase to $238,400,000 by 2021. Adult use sales are projected to reach $929,300,000 by 2021.
Possible marijuana business opportunities in Massachusetts
The state is open to Medical Marijuana Treatment Centers, also known as Registered Marijuana Dispensaries (RMD). RMDs are nonprofit entities that may obtain, grow, and dispense marijuana-related products. As of November 8th, 2016, Massachusetts is also open for recreational marijuana businesses.
The regulations that came into effect December 15th, 2016 allow for:
- Marijuana testing facilities
- Marijuana product manufacturers
- Retail marijuana stores
- Marijuana cultivators
The state has not established an application process yet; however, recreational stores and facilities can apply for licenses in April 2018. The first permits are scheduled to issue in June. This is just weeks before the first stores should open on July 1st.
For these first sets of licenses, the state plans to issue them to applicants with the most experience operating medical marijuana treatment centers first. After that, they will use a lottery among qualified applicants.
Licensing of your marijuana business is different depending on its functionality. There are 4 License Types available in Massachusetts: Cultivator, Manufacturer, Testing Facility, and Retailer (dispensary and delivery).
The standards for Massachusetts marijuana are the same as an alcohol licensee. Previous marijuana-related convictions won’t disqualify you from licensure. Growers should also be aware that the Cannabis Control Commission can institute an absolute cap on marijuana cultivation statewide.
There will be a maximum of 75 cannabis product manufacturers until October 2018 and a max of 75 cultivators until October 2019. When an application is received by the Cannabis Control Commission, they send a copy to the municipality in which the cannabis establishment is to be located. Whether the application is approved or rejected, the applicant will receive an official answer within 90 days.
The fees associated with applications are:
For adult use (recreational):
- Initial Application fee: up to $3,000
- License for retail marijuana store: $15,000
- License for a marijuana cultivator: up to $15,000
- License for a marijuana testing facility: up to $10,000
For medical businesses:
- Dispensary Stage 1 Application Fee: $1,500
- Dispensary Stage 2 Application Fee: $30,000
- Architectural review: $8.25 per $1,000 of construction costs, with a minimum fee of $1,500
How much does a marijuana dispensary in Massachusetts make?
The time frame to start a marijuana business varies – but at least a year is a good estimate. You will need time to secure finances, acquire necessary licenses, and source suppliers and employees.