This article first appeared on the Boston Business Journal’s website.
Once upon a time, Worcester had been forecast to be the cannabis capital of Massachusetts, as its number of licenses grew. The state’s industry regulators even moved their headquarters from Boston to the state’s second largest city.
But now, a different city an hour’s drive west of Worcester — and 90 minutes from Boston — is the new leader in terms of the number of completed license applications, according to a Boston Business Journal analysis of submitted recreational marijuana licenses through July 9.
The city of Holyoke has reported 40 completed applications that had been submitted to the state. That’s 5% of the 841 total licenses received to date.
Those licenses include four licensees that have opened — a manufacturing and cultivation license under Rise Holdings, and two dispensaries owned by Canna Provisions and Boston Bud Factories. Another 21 licenses have received provisional approval, and 15 have self-attested to submitting a completed application to the state.
By comparison, Worcester counted 28 licenses: five open, 19 provisionally approved, and four submitted applications. Pittsfield reported 26 licenses, while Fitchburg counted 24, ranking third and fourth.
All told, Holyoke would have one dispensary for every 1,000 residents if all applications are approved. That’s a higher concentration than Worcester, which would have one per every 6,600 residents, as well as both Pittsfield and Fitchburg.
And according to Marcos Marrero, director of planning and economic development for the city of Holyoke, the number of cannabis businesses in the city is no coincidence. “It has absolutely been a concerted effort,” he said.
According to Marrero, a number of factors have helped propel Holyoke towards becoming a cannabis hot spot, starting with Mayor Alex Morse and the city council.
Morse was one of the first mayors in the state to endorse the legalization of recreational marijuana, Marrero said. Additionally, the city council has been willing to approve zoning laws to become more marijuana-friendly, and as cannabis companies have come before the city council for special permits, the council has approved every one.
“It’s not just one person. Holyoke voters voted affirmatively 57% in favor of cannabis, which is over the state average,” Marrero said. “Councilors see that as well and understand this is something the population desires … That’s the kind of stability that goes beyond one individual.”
The city has created a streamlined process for signing a contract with the town, easing one common stumbling block for cannabis operators in other communities. The “host community agreement” outlines both the excise taxes the town will take and the community impact fees that will be provided to the town to mitigate the effects of the establishment.
And while some municipalities have used it as an opportunity to exact donations and annual payments from cannabis operators, Holyoke has taken the opposite approach. The city provides a template that asks for the 3% tax and 3% fee outlined by state law. Dispensaries that want a contract can fill one out and have it signed the same afternoon — a timeline that’s practically unheard of in most communities, where negotiations often take three to six months.
But Marrero said the city also benefitted from another factor: It was perfectly primed for cannabis businesses, with 2 million square feet of vacant real estate, long a burden for the city’s tax rolls. That’s played to the city’s advantage for companies looking to locate large cultivation or manufacturing plants in the city. Holyoke also has some of the cheapest electrical rates, an attractive bonus to cultivators in particular.
City officials hope the effort will pay off in research and chemical manufacturing, providing a link to the pharmacy sector in the eastern part of Massachusetts and connecting the state’s divergent regions.
The burgeoning industry can also help employ local residents, 50% of whom are Latino. The city requires local cannabis companies to hire 30% of staff from the community, and has provided entrepreneurship opportunities through Holyoke Community College and coworking space “EforAll Holyoke.”
By moving quickly, Holyoke hopes to create an economic cluster both in the city and in Western Massachusetts, bringing ancillary businesses to the region as well.
“We’re trying not just to attract many companies because we see the benefit as being the sum of its parts, though that’s important. The more buildings you fill, more taxes, more assessed value, the more people they will employ,” Marrero said. “It’s about creating a cluster effect.”