Ascend deal leaves questions for Montclair (News Analysis)
In the uneven, sometimes stormy relationship between Montclair and Ascend, which recently became the town���s first licensed seller of recreational marijuana, June 7 of this year stands out. That’s the day when Ascend expanded its medicinal cannabis business to include recreational use — though approval by the Township Council was still in the distance.
The company later called it a misunderstanding and apologized, and the council ultimately looked past it, even as Ascend threatened a lawsuit over a process that ground on through the summer. And on Wednesday, Aug. 31, handshakes and good wishes were exchanged at a ribbon cutting outside the store on Bloomfield Avenue, as Ascend was officially re-welcomed to the neighborhood.
Call this a case of forgiving but not forgetting.
For its transgression, Ascend will give $75,000 each to two charities: the Montclair Neighborhood Development Center and the Montclair Community Pre-K. The settlement agreement that accompanied the resolution passed last month calls it a “voluntary donation,” but the agreement explicitly ties the largesse to the foul-up on June 7.
It also invokes a one-way nondisparagement clause subjecting Ascend to a $2,000 fine any time its representatives say a bad word about Montclair — not uncommon in settlement agreements — but a dissonant note in an arrangement that bestows the town with 2% of Ascend’s revenues.
The stipulation adds to an aura of secrecy that has trailed a process that began soon after New Jersey began legalized sales of recreational marijuana in April. Much of the Township Council’s debate on the issue happened in executive sessions. There were at least two sessions out of view that ran for nearly three hours, thought to be focused on Ascend.
Officials say the threatened lawsuit, by introducing litigation into the deliberations, forced the debate behind closed doors. New Jersey’s Open Public Meetings Act gives towns threatened with a lawsuit the latitude to go into executive session, but it does not compel officials to do so.
The byproduct in Montclair — intentional or otherwise — was a limited opportunity for a public forum on the question. While the legalized marijuana trade is flourishing, many municipalities in the state have gone the other way, instituting bans.
The deal between the town and Ascend may actually provide a road map for how the town now vets a fresh stack of applications from companies trying to land one of the two additional licenses Montclair has put on the block. While it is unclear how many vendors met the Aug. 31 deadline or if a gift to the town will be necessary to seal the deal, Councilman Peter Yacobellis said, “Ascend provides us with education on how to go forward.”
“The whole experience with Ascend is blazing the trail,” he added.
With the rulebook on recreational sales still being written by New Jersey’s Cannabis Regulatory Commission, towns across the state have often been left to set their own thresholds for companies to receive a license, even with millions of dollars in the balance.
Ascend is a publicly traded company operated by Ascend Wellness Holdings Inc. In the 17 days after Aug. 16 — the day Montclair gave the go-ahead for recreational sales — Ascend’s stock value rose 6%.
Improvising in a new space has left some local officials, like Yacobellis, troubled that applicants don’t have to address potential sticking points, including whether they are making political contributions as well as their lobbying relationships.
“It’s the wild West,” Yacobellis said. “It feels that way. Yes, regulations have trickled out, but the timing has been really challenging. They were asking municipalities to opt in or opt out before there were rules. So here you have these huge operators coming into New Jersey and you don’t know if all the proper checks are in place. I wish there were stronger guidelines.”
With Ascend, Montclair was negotiating with a company that had a foothold in the community with a relationship already in place with medicinal marijuana. Still, that did not prevent a tortuous path toward final approval, leaving a question hanging over the next round of vetting: How can the
process go smoother?
Yacobellis said it was appropriate for the Montclair Neighborhood Development Center and the Montclair Community Pre-K to receive the $75,000 windfalls from Ascend.
“They represent communities,” he said, “that have been disproportionately hurt by legacy laws that criminalized the use of marijuana.”
Councilman Bob Russo said that going forward he would like to see a big piece of the tax revenues that flow from the legalized sale of marijuana go to programs for seniors, “whether it’s $50,000, $100,000 or $200,000.”
One official familiar with the Ascend debate said that applicants for the two prospective cannabis businesses would not be pressured by the town to make donations.
“But community benefit is part of any application process,” the official added. “There are no parameters around that.”
Talia Adderley contributed reporting for this article.
An earlier version of this article misstated a comment by Peter Yacobellis about political relationships between recreational marijuana companies and local officials. He indicated that there is no requirement for the companies to disclose political contributions.