Multiple parties seeking to enter the medical marijuana business in Aspen filed paperwork for sales tax licenses Wednesday in order to comply with a state deadline.
State laws passed this spring by the Legislature place a moratorium on new dispensaries that aren’t already established or don’t have an application in the pipeline before today.
Aspen currently has four operating dispensaries, which sprung up last summer. It was not clear Wednesday night how many more had applied before the deadline, but local attorney Lauren Maytin confirmed that the deadline prompted activity.
Other facets of the new laws require all dispensaries to apply by Aug. 1 for a license through the state and pay a licensing fee that begins at $7,500 for the first 300 patients. The license could cost as much as $18,000, depending on the amount of products offered and the number of patients. As part of the licensing process, every individual working at or owning a dispensary must submit to a background check. Anyone with a felony drug conviction will be prohibited from participating in the medical marijuana business. Other felony convictions will not bar a person from being in the medical marijuana business.
By Sept. 1, 70 percent of the marijuana sold at a dispensary must come from the dispensary itself or a licensed off-site growing operation that is connected to the dispensary.
While the new regulations represent a “hurdle” for owners, “patients’ rights are essentially the same,” Ute City Medicinals owner Brett Nelson said.
The licensing fees represent an upfront cost to establish a new regulatory framework. The Colorado Department of Revenue is hiring at least 10 new enforcement officers to deal with dispensaries, Nelson said, adding that he is expecting “10 times” more regulation.
The new regulations also apply to medical marijuana growers, some of whom currently enjoy selling to multiple dispensaries. The law limits how many dispensaries independent growers can have as clients. While the new regulations will push many small-time growers out of business, “the quality control will be through the roof” for the remaining operations, Nelson said.
Some observers believe that between 30 percent and 50 percent of the estimated 1,100 dispensaries in Colorado won’t survive the new regulations. However, Maytin, who has been “slammed” with local and statewide medical marijuana clients, said “it’s all guesswork” in terms of the effects of the new regulations.
Chad Carlos, co-owner of local dispensary L.E.A.F., said the regulations are “respected,” but they will lead to a greater corporatization of the medical marijuana business, which he said is unfortunate. Many independent suppliers will go out of business, he said.
“It’s upsetting to see,” Carlos said.
The new state laws give cities the power to ban dispensaries altogether, or set up more stringent regulatory frameworks for their operations in their jurisdictions.
“There has been no indication that [City Council] wants us to pursue any of those options,” city of Aspen Community Development Director Chris Bendon said, adding that dispensaries, which are classified in Aspen as both pharmacy and retail, are subject to the same zoning codes as any other business. “For the time being, it’s just business as usual.”
In the future, the city might consider amending its land-use code to allow for commercial marijuana growing operations in more areas in town, Bendon said. Such an agricultural use is currently allowed only in limited areas.