Mayor Ken Gray recently signed community host agreements with both of the companies that have received provisional licenses to cultivate medical marijuana in Amesbury, the Alternative Therapies Group (ATG) and Green Heart Holistic.
Both agreements took up and extended the negotiating framework that Mayor Kezer had started late last year, as his term came to an end.
Mayor Gray forwarded copies of the agreements to the City Council today.
I have posted them here:
The agreements are different in technical terms but appear to be the same in the essentials [caveat: I'm not a lawyer]:
- Both companies agree to make unrestricted contributions of $50,000/year to the City for 5 years
- Both companies agree to make additional contributions to Amesbury charitable organizations of at least $5,000/year
- After 5 years, both companies agree to make unrestricted contributions of $50,000/year, with increases chained to the Consumer Price Index
- No end date, save the point that either business either loses their DPH license or moves out of Amesbury
- Both companies agree to be treated as non-tax exempt entities, for the purposes of local property and personal tax, irregardless of how either the Commonwealth or the local Assessor determines they should be treated (given their Chapter 180 status as exempt organizations)
- Both companies agree that they will not seek DPH licenses to dispense medical marijuana in Amesbury
Assuming that both ATG and Green Heart's provisional licenses are made permanent by DPH, Amesbury stands to realize at least $100,000 a year in unrestricted income. When we are talking at the level of individual positions (as I believe we will be in this year's budget), that kind of income from two businesses is significant.
The tax status provision is also significant. Opinion on how these businesses will (or won't) be taxed locally has been all over the map. Our own City Assessor has indicated that, in his opinion, these entities (organized as 'Chapter 180' tax-exempt organizations in MA), would not be subject to local property and personal tax. The MA Dept. of Revenue has officially taken no position on this. And former Mayor Kezer and other have not considered them to be tax-exempt. The tax status provision nails this down and says that these businesses WILL be subject to local property and personal tax. Practically, this likely doesn't mean TOO much, in terms of tax revenue. Businesses are only taxed on property if they own it. Both ATG and Green Heart will be leasing space for operations but they may own their cultivation and fabrication equipment, meaning the latter will now definitely be taxable. Again, not a ton of money but not nothing.
Not having an effective end date is a double-edged sword. On the one hand, it guarantees all parties a stable and predictable framework. Budget Directors like this and businesses like this, as well, in terms of predictable obligations. On the other hand, there is no room to change the arrangement, if circumstances change (save the narrow escape clauses).
Finally, both companies agree not to pursue licenses to dispense in Amesbury, taking that issue of the table for now, at least as far as these two companies are concerned.
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