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ADJOURNED 'til Tuesday at 11 a.m. (informal)
ADJOURNED 'til Thursday at 1 p.m. (formal)


By Colin A. Young

BOSTON, OCT. 3, 2017...As he prepares an immediate budget request for this fiscal year and his agency's budget request for its first full year in existence, the chairman of the Cannabis Control Commission has been meeting with lawmakers and expects to have an estimate of the CCC's fiscal needs within two weeks.

Chairman Steven Hoffman said he's already held about a half-dozen meetings with state lawmakers and expects to hold another six or seven. The topic of funding for the fledgling CCC, which was not a hot topic of debate in the Legislature during debate on pot taxes, comes up "every single time," he said.

"What I say is, 'I am not here today to ask for money because I don't know how much we need, but I will be back,'" Hoffman said. "And what I'm asking for is some guidance in terms of what they need from us to help them with that process."

The Executive Office of Administration and Finance transferred $500,000 from the Cannabis Costs Reserve to the CCC last month to support initial start-up costs for the commission, including payroll for the five commissioners. The fiscal year 2018 budget included $2 million for the Cannabis Cost Reserve, though Treasurer Deborah Goldberg has said the commission will need an annual budget of roughly $10 million to properly oversee the new industry.

Hoffman said Goldberg's estimate was "possibly, probably" about right but said his estimate -- which he said he will make public "within, I would say, no more than two weeks" -- will have to account for different circumstances than when Goldberg put her estimate together.

"I will tell you it's going to be different because one of the things that the treasurer's budget assumed was that the commission was going to be part of the treasurer's office, which was part of the original voter initiative, and therefore could share some resources and support. That's no longer the case," he said. "So among other things, that's one of the adjustments we're going to have to make for the commission's estimate and I'm just not in a position now to offer an estimate."

In the coming weeks, lawmakers are expected to consider a fiscal 2017 closeout budget, which looms as a potential vehicle for additional commission funding. But money is also relatively scarce within the state budget, evidenced by soaring health care costs and spending cuts in the face of anemic tax growth.

In addition to the CCC's budget requests, Hoffman is also working to put together a forecast of how much revenue the state and municipalities can expect to collect once legal retail marijuana sales begin.

"Various people including the treasurer's office and the Department of Revenue have prepared forecasts of both the gross revenue from legalized marijuana sales at the retail level but also what the tax implications are for the state, the commission and for local municipalities that host facilities," he said at a CCC meeting Tuesday morning.

By the end of the second year of legal marijuana sales, Massachusetts could collect as much as $172 million annually in marijuana tax revenue, DOR told the Marijuana Policy Committee in March, before the Legislature had agreed on final tax rates. DOR estimated a range in taxable sales between $771 million and $1.433 billion with a middle point estimate of $1.102 billion, producing total state and local taxes of between $93 million to $172 million, with a middle point estimate of $132 million.

Hoffman said he has met with Christopher Harding, the commissioner of revenue, and is scheduled to sit down with the DOR economists who have analyzed potential marijuana tax revenue next week. He said the commission's revenue forecast will be reviewed at a public meeting of the commission.

"The revenue forecast is a very critical part of what we're trying to model because we want to and expect to be self-funding at some point in time and that's where the revenue forecast is relevant," Hoffman said.


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