Pure Oasis closes amid mounting debts, frozen account
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From left, then-Mayor Marty Walsh joins co-owners Kevin Hart and Kobie Evans to celebrate the opening of Pure Oasis in 2020. Photo: David L. Ryan/The Boston Globe via Getty Images
Pure Oasis was playing catch-up on a growing pile of bills when its owners were dealt back-to-back setbacks this month, prompting them to close the store.
Why it matters: Boston's first recreational cannabis dispensary is the latest casualty in a state with rising costs, an oversaturated flower market and limited resources for cannabis business owners, one of the owners says.
Catch up quick: Pure Oasis, one of the state's few Black-owned dispensaries, closed its doors in Roxbury and downtown last week, catching customers and employees off guard.
- The company's 60 employees haven't been paid because the Department of Revenue froze its account last week due to delinquent taxes, co-owner Kobie Evans told Axios.
Driving the news: Pure Oasis owes DOR roughly $400,000, for which Evans was trying to negotiate a payment plan with help from Sen. Liz Miranda.
- A DOR spokesperson didn't respond to a request for comment Tuesday. Evans and Miranda said the agency was unwilling to consider alternatives prior to freezing the account.
Friction point: Evans said he was waiting on a $300,000 grant from the state's Social Equity Trust Fund to pay part of the tax bill, but he's didn't receive it.
- The state Executive Office of Economic Development plans to distribute the funds in the coming weeks, a spokesperson said, but it's not a blank check.
- Awardees must enter into an agreement with the office and then submit eligible payments for reimbursement, the spokesperson said.
Context: It wasn't the first time DOR froze Pure Oasis' account.
- Still, Evans said that, between that, the cannabis bill to lift license caps from three to six and Boston's approval of a downtown dispensary run by multi-state operator Curaleaf, closing felt inevitable.
- His focus now, he added, is to get his account unfrozen so his staff can get paid.
The big picture: Businesses across the state are struggling to pay their bills and taxes in this economy, Miranda says.
- Cannabis businesses, however, have even fewer resources because cannabis remains illegal federally, which shuts out business owners from most loans, grants and relief programs.
Zoom in: The bills have piled up for Pure Oasis over the past year, as it juggled two dispensaries and plans for a third in Brighton.
- The cannabis supplier Blue Fox Brands sued Pure Oasis last year over a $65,000 debt.
- The two companies agreed on a payment plan after a judge ruled in Blue Fox's favor, but Pure Oasis has a balance of more than $57,000, per a Blue Fox representative.
- Pure Oasis also faces a lawsuit from Stack Design Build over $175,000 for work done building the Brighton space.
- Pure Oasis and Pure Oasis Ventures, a separate LLC, were on the hook for nearly $2.3 million over a defaulted mortgage for a property in Dighton, Evans said.
What we're watching: Pure Oasis told the Cannabis Control Commission its closure is temporary, but Evans says he's not sure if he and co-owner Kevin Hart will reopen.
- "We're in this precarious situation and, even if we rally, you know, what does rallying look like?"