Fall River’s first cannabis retailer wants $4.6 million back from the city. Now the city says the company owes it money. In an answer and counterclaim filed October 26, 2026, in Bristol County Superior Court, the city and Mayor Paul Coogan denied that the community impact fees Northeast Alternatives paid from 2019 to 2022 were unlawful and accused the company of breach of contract for stopping payments, the Fall River Reporter and The Herald News reported. The Herald News report was republished by Massachusetts Lawyers Weekly.
No court has ruled on either side’s claims.
The company’s claim
- The amount. Northeast Alternatives, Inc. seeks the return of $4,604,235.19 in fees it paid between April 2019 and September 2022 under its host community agreement and a December 2018 amendment, the Fall River Reporter reported. The company first sued in June, according to The Herald News, and filed a First Amended Complaint this month.
- The original deal. CEO Chris Harkins and then-Mayor Jasiel Correia II signed the agreement on April 13, 2018. It required “a payment of 4% of Gross Revenue annually derived from retail sales in the city of Fall River,” plus 4 percent of certain wholesale receipts and $40 a pound for cannabis grown in the city and sold at retail elsewhere, The Herald News reported.
- The amendment. In December 2018, the parties cut the percentages to 3 percent and the per-pound charge to $30, The Herald News reported. The company also says it made annual $50,000 payments and paid a purported local excise tax, according to the Fall River Reporter.
- The theory. The company says the fees were flat percentages of sales with no documentation tying them to the city’s actual costs, as Chapter 94G requires. It says it asked for cost records at its annual license renewals and got no substantive answer, the Fall River Reporter reported. It seeks damages, a declaration that the fees were unlawful, repayment with interest and attorney’s fees.
- The regulator. Exhibits in the case show that in November 2024 the Cannabis Control Commission told Fall River the agreement was “noncompliant” with state law and had to be revised, The Herald News reported.
The city’s answer and counterclaim
- Denial. The city says the agreements speak for themselves and that the fees were reasonably related to the costs the company’s operations imposed on the city, the Fall River Reporter reported.
- Not retroactive. The city argues that the November 2022 amendments to Chapter 94G do not apply to agreements signed and payments made before then.
- Breach of contract. “In or about 2022, NEA ceased making certain payments required under the Agreement,” the counterclaim says, according to The Herald News. “As a result, the City has sustained damages, including unpaid amounts due under the Agreement.” It does not state a dollar figure and asks for damages “in an amount to be determined at trial.”
- Jury. Both sides have demanded a jury trial, according to the Fall River Reporter.
The law: what Chapter 94G said in 2018, and what it says now
The retroactivity argument matters, because the two versions of the statute differ. We read both at malegislature.gov.
- The 2017 version. The cannabis law the Legislature passed in 2017, Chapter 55 of the Acts of 2017, said a host community agreement “may include a community impact fee,” but that the fee “shall be reasonably related to the costs imposed upon the municipality by the operation of the marijuana establishment” and “shall not amount to more than 3 per cent of the gross sales of the marijuana establishment” or be effective for longer than five years. It also required that any cost to a city or town “shall be documented and considered a public record.” That was the law when the 4 percent agreement was signed in April 2018.
- The 2022 overhaul. Chapter 180 of the Acts of 2022, “An Act relative to equity in the cannabis industry,” approved in part on August 11, 2022, rewrote the host community agreement rules. It provides that “[t]he commission shall review and approve each host community agreement as part of a completed marijuana establishment or medical marijuana treatment center license application and at each license renewal,” and must give written notice of any deficiencies.
- The current text. G.L. c. 94G, § 3(d), as since amended, says the fee shall “be reasonably related to the costs imposed upon the municipality by the operation of the marijuana establishment,” “amount to not more than 3 per cent of the gross sales,” end after the eighth year of operation and “not mandate a certain percentage of total or gross sales as the community impact fee.” The fee “shall encompass all payments and obligations between the host community and the marijuana establishment,” and “[a]ny other contractual financial obligation that is explicitly or implicitly a factor considered in, or is a condition of a host community agreement, shall not be enforceable.”
The city’s argument is that the 2022 rules do not reach the earlier payments. The 3 percent cap and the requirement that fees be reasonably related to documented costs were already in the 2017 statute, though. How a court treats a 4 percent agreement signed under that statute, and what the city must show about its costs, are among the questions the case presents.
The Correia backdrop
Correia, who signed the agreement, was later convicted in a separate federal case of extorting would-be cannabis operators and was sentenced to federal prison, Massachusetts Lawyers Weekly reported.
Frequently asked questions
What is a community impact fee in Massachusetts?
A payment a cannabis business may agree to make to its host city or town under G.L. c. 94G, § 3(d). It must be reasonably related to the municipality’s documented costs of hosting the business, cannot exceed 3 percent of gross sales, cannot be set as a percentage of sales, and cannot run past the business’s eighth year of operation.
Can a cannabis company get community impact fees back?
That is what Northeast Alternatives is asking the Bristol County Superior Court to order. Fall River denies the fees were unlawful and has countersued for unpaid amounts. No court has ruled.
Who regulates host community agreements?
The Cannabis Control Commission. In November 2024 it told Fall River that the Northeast Alternatives agreement was noncompliant and needed revision, according to exhibits described by The Herald News.
Sources: Fall River Reporter; The Herald News, republished by Massachusetts Lawyers Weekly, October 30, 2026, reporting on filings in Bristol County Superior Court. Chapter 55 of the Acts of 2017, Chapter 180 of the Acts of 2022 and G.L. c. 94G, § 3 read at malegislature.gov. No court has ruled on the claims. General information, not legal advice.