A cannabis retailer’s suit against Haverhill over “impact fees” and how they are documented was settled Thursday after marathon talks.
In a joint statement Friday, Stem Haverhill and the city said the two sides reached resolution with the help of a mediator. They said, “In light of the evolving and uncertain landscape surrounding legalized cannabis and a municipality’s ability to collect community impact fees, the city and Stem worked diligently to reach this compromise, in the spirit of mutual cooperation.” While not yet disclosing any terms of the agreement, they added, “This resolution allows the parties to avoid costly litigation, giving them the ability to move forward and focus on other matters of importance to the citizens of Haverhill.” Reached by telephone, Haverhill Mayor Melinda E. Barrett did not elaborate, but told WHAV how the breakthrough was achieved.
“We had mediation yesterday—it was a long mediation; it went from 9 to about 8:30 at night. We came to an agreement,” the mayor said.
Stem, the city’s first recreational cannabis store to launch, opened in 2020 in downtown Haverhill at 124 Washington St. Store owner Caroline Pineau filed suit about a year later, asking Essex County Superior Court to make Haverhill “provide the required documentation and substantiate the (impact) fee,” allow the court to hold the fee until the matter is resolved and prevent the city from recovering certain legal costs.”
This past June, as WHAV reported, Superior Court Judge Jeffrey T. Karp, in a partial decision, denied Stem’s request to immediately decide in its favor that city fees are overinflated and lack proof, but also agreed with Stem that the city must properly account for any increased cost to the city by hosting cannabis businesses.
More importantly, perhaps, Karp preliminarily ruled the legislature’s 2022 reform of host community agreements, invalidating percentage-based annual Community Impact fees, could not retroactively apply to agreements signed by Stem and other cannabis retailers. A 3% local sales tax, however, remains on the books.
Pineau told WHAV last month that sluggish discussions with the city over a replacement host community agreement put her state license renewal in jeopardy. Barrett told WHAV today, however, the settlement reached Thursday open a new path forward. “We’ll have to execute a host agreement still, but we have the parameters of it in this settlement agreement.”
Had the accord not been reached, Stem and the city were preparing for trial next spring with an extensive list of witnesses planned.