Westport Select Board members threw a regulatory olive branch to the town’s first legal marijuana seller Monday evening, agreeing to a settlement with State Road’s Coastal Healing that will save the dispensary some $90,000 that was otherwise owed, and creating a new host agreement that eliminates the impact fees Westport once charged.

The board’s 3-2 decision to accept a $10,000 settlement from Coastal Healing in lieu of some $100,000 in impact fees it has accrued over the past two years tracks with what’s happening in many other towns across the commonwealth, following a change in state law that now requires towns to justify the fees they collect from marijuana retailers. Board members Steve Ouellette and Manny Soares cast the ‘nay’ votes.

Prior to Coastal Healing opening in 2022, among the biggest selling points for many here were the impact fees the town would collect under its ‘Host Community Agreement’ (HCA) with the retailer.

Under regulations then in place from the state’s Cannabis Control Commission, HCAs, state-required agreements between retailers and the towns that host them, allowed towns to collect fees of up to 3 percent per year to defray any negative impacts retailers have on the town, as well as a 3 percent tax levied and collected by the state that is then returned to the town. Coastal Healing was also required under its original HCA to pay a flat $25,000 yearly impact fee to the town.

Those fees were put in place to offset negative impacts created by businesses — increased traffic and police enforcement, and the like. But those fees, collected by every town with a marijuana establishment, have since been appealed by dozens of retailers across the state, which argued that they were excessive and could not be quantified or justified by the towns.

Consequently, the state passed revised regulations soon after Coastal Healing opened that change the impact fee structure, requiring that towns must now show receipts to justify the impacts for which they seek to be compensated.

“When we negotiated the host community agreement in the first place, we were unsure of the impact,” board president Shana Teas said. “It was quite controversial. We were ... afraid of the negative things that would happen. And it never materialized.”

“We also didn’t entirely uphold our end of the agreement,” board member Craig Dutra said Monday. “We were unable to document the impact in terms of public services responses beyond what would normally occur for a business on Route 6.”

“I’m not aware of any direct impacts on the community,” town administrator James Hartnett added.

Philip Silverman, attorney for Coastal Healing, told select board members that while they could challenge the law as it stands and seek to recoup that $100,000 in owed fees, it would likely do nobody any good:

“Bottom line is trying to litigate and figure out an answer (to what any impact’s dollar amount should be) would cost a heck of a lot more than the town would ever collect,” he said. “It’s a lot more than we can afford to pay given the competitive nature of the business and that’s why we proposed” the $10,000 settlement.

“If there are any impacts, I can’t imagine it actually exceeds that amount.”

Ouellette was the only board member voting against to explain his reasoning. Simply, he said, “this was part of the selling point about coming to town.”

“That’s the only reason people voted for it, was because of these funds coming in to helping our community.”

Apart from the 3-2 vote in favor of the $10,000 settlement, board members also voted unanimously to pass a new CHA with Coastal Healing.

The new agreement does not provide for the assessing and collecting of impact fees, and mirrors the agreement the town recently signed with Port Supply, a new dispensary which is expected to open soon directly next door. However, the marijuana tax customers pay is still being collected by the state, and the town will continue to share in those proceeds.