Local News

By Beth Treffeisen

June 20, 2025 | 1:55 PM

4 minutes to read

A new House bill is attempting a major restructuring of the state’s cannabis industry.

The bill — “An Act Modernizing the Commonwealth’s Cannabis Laws,” passed by the House on June 5 — aims to reform the Cannabis Control Commission (CCC), expand access and business opportunities, increase tax revenue, and address concerns around hemp regulation and equity in the industry. It now awaits action from the Senate. 

The most significant change would be to restructure the CCC leadership. The governor would appoint a full-time chair and two part-time associate commissioners, consolidating authority. Currently, the CCC is a five-person commission, appointed by the governor, treasurer, and attorney general, with the treasurer selecting the chair.

The change in governance and oversight addresses the dysfunction and turnover seen at the CCC, which the inspector general called “rudderless” and marred by controversy last year. 

It also follows state Treasurer Deborah Goldberg’s firing of former Commission Chair Shannon O’Brien after she was suspended from the job in 2023, citing “committed gross misconduct.”

Rep. Dan Donahue, chair of the Joint Committee on Cannabis Policy, says the changes in the structure would ensure the industry has an effective regulator by making it more nimble to act on the needs of the industry. 

“This bill is a lifeline to an industry that is in desperate need of help,” said Steve Reilly, the head of government relations at the marijuana company Insa. “I hope the Senate recognizes the urgency of this, like the House did.” 

The legislation would increase the retail cap from three to six licenses per operator over a three-year period. A controversial move, as critics say it favors large corporations. 

However, Reilly said, the expansion of licenses would help improve the exit strategy for owners by making it easier to sell or convert to employee-owned businesses, which offer tax benefits. 

Business leaders say it would also help businesses grow to a point where they become profitable. 

The legislation would also allow individuals to purchase up to two ounces of cannabis flower daily, doubling the current one-ounce limit.

In addition, it would allow retail-only medical marijuana dispensaries, removing the current requirement to cultivate and process in-house. 

The move would decouple medical marijuana from the vertical model, Donhanue said, making it easier for new players to enter the medical market. It would also enhance patient access through retail-only medical dispensaries and help small operators who want to participate without a massive capital outlay. 

The current ownership and investment caps of 9% have made it difficult for small or minority-owned businesses to raise capital, Reilly said. The new law would raise the cap to 35% from outside investors, but Reilly argues he would like to see it go even higher to 49%, allowing founders to maintain majority control.

However, Equitable Opportunities Now argues the bill may harm small and social equity businesses by enabling corporate dominance. 

“This bill is a gift to corporate cannabis and a death sentence for local and social equity businesses. How is someone with one, two, or three stores supposed to compete with someone buying for six or more stores?” Shanel Lindsay, the group’s cofounder, said in a statement last week. 

She continued, “It will undermine everything Massachusetts has worked so hard to achieve in building the most equitable cannabis industry in the country.”

The legislation would introduce regulation and a 5.35% sales tax on hemp-based drinks and propose that only licensed cannabis retailers can sell them, removing them from gas stations and convenience stores. 

It would close loopholes in the 2018 federal Farm Bill, which legalized hemp but allows manufacturers to exploit the law. The bill limits THC to 0.3% by weight, which works for plant material but lets beverages and other products contain much higher amounts. It also lets less potent, THC-like cannabinoids derived from hemp be sold without any regulation.

Ryan Dominguez, the executive director of the Massachusetts Cannabis Coalition, said the hemp beverages are a “big threat to our industry” and are “not being tested and regulated, which is a cause of a lot of concern from a public health safety standpoint.”

The state bill couldn’t come at a better time. The Massachusetts cannabis industry is struggling due to oversupply, competition from other nearby states, and unclear regulations. 

Reilly said that Massachusetts built out an industry to meet the demand of other neighboring states as well. But, they have since caught up and legalized the sale of marijuana. Now, the industry is selling the appropriate amount, but it is overbuilt compared to the demand. 

Even though marijuana establishments in the state generated more than $1.64 billion in gross sales last year, setting a new record, Dominguez says small businesses in the industry continue to close each week. 

Donahue said federal issues like the Farm Bill hemp loophole and 280E tax code restrictions, which don’t apply to all marijuana businesses (since it is still illegal federally to gain the same tax benefits as small businesses), further complicate operations. 

If the legislation doesn’t pass, Reilly said, “things will be far worse.” 

The Senate will now consider the bill, though lawmakers have not set a timeline for its advancement.

The consensus among industry stakeholders is that urgent action is needed to stabilize the market and clarify regulations, particularly regarding hemp products and the governance of the CCC. 

The future of the industry is anyone’s guess. 

“I’ve given up on having a crystal ball in this industry,” said Timothy Shaw, COO of the marijuana company MariMed, Inc. “What seems like a slam dunk never is. I’m not shocked anymore.”