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Franklin officials favor medical marijuana sales tax

Nutting, Roy testify at State House

Matt Tota Daily News Staff
Town Administrator Jeffrey Nutting and state Rep. Jeffrey Roy, D-Franklin, left, testified before the Revenue Committee Wednesday at the State House, supporting a bill that would allow the town to impose a 5 percent local sales tax on the retail and wholesale sale of medical marijuana. Daily News Photo/Matt Tota

BOSTON — By charging a local sales tax on medical marijuana, Franklin intends to raise money to cover increased police activity relating to a large cannabis growing operation in its industrial park, the town administrator told legislators Wednesday.

Town Administrator Jeffrey Nutting and state Rep. Jeffrey Roy, D-Franklin, testified before the Revenue Committee at the State House, supporting a bill that would allow the town to impose a 5 percent local sales tax on the retail and wholesale sale of medical marijuana.

Sometime in the fall or early winter months, New England Treatment Access Inc. is expected to open a 70,000-square-foot growing facility in the Forge Park industrial area. The medical marijuana grown in Franklin will be transported for sale at New England Treatment Access dispensaries in Brookline and Northampton.

The company received approval last month from the state Department of Public Health to enter the inspectional phase of the licensing process.

"We have concerns about additional public safety issues," Nutting told state Sen. Michael Rodrigues, D-Westport, and state Rep. Randy Hunt, R-East Sandwich, the only two members of the Revenue Committee present for Wednesday’s hearing. "That’s a lot of transportation back and forth from this facility."

The town would use the funds collected from the sales tax to add police officers so that department would have the room to work closely with New England Treatment Access’ own security personnel, Nutting said.

"This is a small dollar amount for a little peace of mind in Franklin," he said. Nutting later noted that the town doesn’t expect to collect much in property taxes because the company has refurbished an existing warehouse rather than building a new one.

Nutting underscored that Franklin voters overwhelmingly supported the ballot measure to allow medical use of marijuana, adding that the town was one of the first communities in the state to adopt zoning for businesses growing and dispensing the drug.

Town officials haven’t projected how much the sales tax would net because New England Treatment Access is still setting up its operation. In the company’s application for a license, it projected to make $11.8 million in 2015 — growing 2,400 pounds of marijuana and doubling its production by 2016.

Roy, who co-authored the bill with state Sen. Richard Ross, R-Wrentham, testified that with this new industry comes "new public safety concerns."

"This legislation would allow municipalities to recoup some of the costs they have to face and bring essential revenue into the town coffers, money that could fund additional police officers or other town services," he said.

At least three towns have filed legislation for a local sales tax. Fairhaven, the first to do so, was unsuccessful.

Roy believes the bill failed because the proposed Fairhaven dispensary did not make the cut, so Franklin may still have a chance.

Dennis, the third town, submitted a bill this week. Daniel Fortier, the town planner, testified on Wednesday, citing many of the same concerns as Franklin officials.

In addition to using the tax to pay for public safety, Fortier said, Dennis, where two dispensaries have applied, hopes to create new diversion programs for drug abuse.

"Dennis, as with the Cape as a whole, has a drug problem," he said. "Medical marijuana will provide significant medical benefits to its prescribed patients. At the same time, it will provide yet another prescription drug that could be abused."

State Rep. Clint Turner, D-Dennis, who filed the bill, also submitted testimony to the Revenue Committee in which he equated a sales tax on marijuana to an "impact fee" that communities have established to deal with the fallout from casinos.

With formal legislative sessions ending next Thursday, Roy said the Revenue Committee will likely decide on both bills as early as next week.

After the hearing, he said that even if the bill dies in committee, at least the town has started the discussion on locally taxing medical marijuana.

Although the state does not tax medical marijuana, the Department of Revenue has said that a community could do so as after approval from the Legislature.

"I’ve already heard from my colleagues that many of their districts are expressing similar ideas," he said. "We will see many more of these types of bills, if not this year than next."

Matt Tota can be reached at 508-634-7521 or mtota@wickedlocal.com. Follow him on Twitter @matttotamdn.