Massachusetts Cannabis Cafes Struggle to Open Amid Regulatory Delays
Six months have passed since Massachusetts approved regulations for cannabis lounges, but the doors to these Amsterdam-style social consumption spaces remain closed. Entrepreneurs across the state are bleeding cash as they wait for the necessary zoning changes and licenses to open their businesses.
Caroline Pineau, owner of Stem, a Haverhill pot shop, has invested $2 million in renovating her dispensary to create a cannabis lounge. However, she is still waiting for the city to approve the necessary zoning, citing delays and revisions requested by city officials.
Frank Dailey, owner of Boston Bud Factory, has spent $70,000 on a tasting room renovation at his Holyoke dispensary, but is still waiting for the state to release licenses. “Every single day that we miss out on opening our doors to social consumption it is a detriment to our business,” he said.
The Cannabis Control Commission (CCC) is waiting for local governments to adopt zoning changes before releasing licenses. Commissioner Xiomara DeLobato stated, “The municipal side needs to come first.” However, many local officials are hesitant to move forward without more guidance from the CCC.
Business owners are frustrated with the lack of progress, citing a “tangle of regulations” and a “waiting game” with no clear end in sight. Some have expressed concerns that the delays could put their businesses at risk.
The CCC is expected to release supplemental licenses for smoking lounges to be added to existing dispensaries, followed by hospitality licenses for designated venues and special licenses for events. However, the process is expected to take several months, and some entrepreneurs are giving up hope of ever opening their businesses.
The delays have also raised concerns about the financial sustainability of social consumption businesses. Without finalized licenses, it is unclear how much of a moneymaker these businesses will be. Compliance requirements, such as air filtration systems for indoor smoking lounges, could cost millions.
The struggles of Massachusetts cannabis cafes are reminiscent of the state’s rollout of cannabis stores after 2016, where many businesses sat hemorrhaging rent on shuttered storefronts for years as regulatory discussions dragged on.
As the CCC continues to navigate the regulatory process, entrepreneurs are left wondering when they will be able to open their doors and start generating revenue.
