In First Year Of Legal Marijuana, Sales Averaged More Than $1 Million Per Day | WAMC

In First Year Of Legal Marijuana, Sales Averaged More Than $1 Million Per Day

Nov 22, 2019

Northampton Mayor David Narkewicz made the first purchase at New England Treatment Access (NETA) on the first day of legal marijuana sales in Massachusetts November 20, 2018.
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It has been a year since the first recreational marijuana stores opened in Massachusetts.

On November 20, 2018, thousands of people stood in lines for hours in a cold rain so they could for the first time in almost a century in the eastern United States legally purchase marijuana for non-medical uses.

At New England Treatment Access (NETA) in Northampton -- one of two cannabis stores that opened in the state that day -- Mayor David Narkewicz was invited in at 8 a.m. to make the first purchase.

In the past year, NETA has paid millions to Northampton in taxes and fees. There has been an uptick in visitors to the city and no major increase in crime or other negative issues, according to Narkewicz.

"All in all it has been really a strong economic driver and they are also a really good community-minded business," Narkewicz said in an interview with WAMC.

The marijuana store has paid $1.3 million in local sales taxes to Northampton through three fiscal quarters.   Narkewicz said it is a “significant” amount toward the city’s $100 million annual budget.

"Anything that provides us revenue that diversifies away from property taxes that is all to the good in terms of being able to fund the city services and schools that people rely on," said Narkewicz.

Under the terms of its host community agreement with NETA, the store pays 3 percent of its annual gross revenues to Northampton as an “impact fee.”  That money -- $530,559 so far -- is put in a special fund, according to Narkewicz.

That money will be used for capital projects that Narkewicz said will deal with traffic, pedestrian safety and other needs that arise as a result of the marijana businesses.

Narkewicz said he expects the revenue will fall off somewhat as the retail marijuana industry grows in Massachusetts.

"I do try to caution people and temper expectations going forward," said Narkewicz.

There are currently 33 licensed recreational marijuana retailers in 32 communities – there are two stores in Pittsfield.  The Cannabis Control Commission has issued provisional licenses to another 54 retailers that will be able to open after passing final inspections.

 The commission reported that the licensed stores did almost $394 million in gross sales in the last 12 months – for an average of more than $1 million in marijuana products sold each day.

CCC Chairman Steven Hoffman said a statement, “Marijuana Retailers and consumers should be commended for participating in an extremely smooth roll out of the legal adult-use cannabis industry in Massachusetts for the first year.”

  But all did not go completely smoothly in the first year.  Some retailers dealt with persistent shortages of product.

In September, Massachusetts Gov. Charlie Baker declared a public health emergency and ordered a four month moratorium on the sale of all vape products.  Marijuana vape cartridges accounted for about 20 percent of all legal cannabis sales, according to an estimate from the CCC.

In Brookline, where NETA also operates a marijuana store, Town Meeting is considering proposals to allow customers to come only with an appointment and shorten the business hours because some neighbors have complained about an increase in traffic congestion, littering, and public consumption of marijuana.