BOSTON — Negotiations over a new state budget and legislation overhauling the retail marijuana legalization law might appear on paper to have little to do with one another.
But multiple sources close to the deliberations told the News Service on Wednesday that the fates of the two bills have become inextricably linked, with some officials now believing that a compromise on the budget is contingent on the House and Senate first agreeing to the parameters of legal marijuana oversight and taxation.
"The budget is all about marijuana right now," said one legislative source.
Legislators returned to Beacon Hill on Wednesday after mostly hitting the pause button on negotiations for the Fourth of July holiday weekend.
The new fiscal year began Saturday with a temporary budget in place allowing Massachusetts to avoid the types of partial government shutdowns that spurred warring lawmakers and governors in other states like Maine and New Jersey to reach deals over the holiday.
The conference committee negotiating marijuana regulations gathered Wednesday morning in a House antechamber to resume talks after the weekend break, while a separate group of six lawmakers working on the fiscal 2018 budget continue to share ideas, according to House and Senate leaders.
"I know they're meeting," Speaker Pro Tempore Patricia Haddad said after adjourning the House session for the day where she presided.
By keeping budget talks open, House and Senate leadership can preserve extra chits to trade in an effort to broker a deal on marijuana. Holding back from signing off on a budget deal could also give the House leverage in negotiations with the Senate, where members favored making far fewer changes to the 2016 ballot law than House lawmakers and are content to leave much of the ballot law in place.
Settling on a tax rate for retail marijuana sales and deciding who should have the authority to ban retail pot shops from a city or town continue to be two of the major sticking points, according to sources.
In contrasting bills, the House voted last month to set a mandatory tax rate on marijuana sales at 28 percent, but the Senate opted to leave the tax structure in the ballot law unchanged at a maximum 12 percent.
Two sources told the News Service that Senate negotiators, as recently as late last week, indicated a willingness to go as high as 18 percent, but House conferees were pushing for an even split between the two proposals at 20 percent.
Rep. Todd Smola, a Warren Republican and the ranking minority member of the House Ways and Means Committee, said budget conferees continue to talk, but in the State House tradition of keeping conference deliberations private declined to go into details.
"We're working at it. I don't anticipate tonight, but anything's possible. I anticipated something two weeks ago," Smola said as he returned to his office after the House adjourned its informal session.
House leaders scheduled another informal session for Thursday in a sign that a compromise would likely be another day away, at least.
"I wouldn't say we're far apart, no. I would say there's some differences," Smola said of the budget.
Senate President Stanley Rosenberg said Wednesday he didn't think the budget and marijuana bills had to be a package deal.
Asked whether he would want to take votes on both bills the same day, the Amherst Democrat said, "It's an option, I'm not fixated on that."
Spokesmen for the House and Senate Ways and Means Committees did not respond to a request for comment on whether budget talks have been tied to negotiations in the marijuana conference committee.