After almost three years of expensive and often frustrating effort, Kale Lacroux and Justin Streeb have finally opened the doors on their medical marijuana dispensary in downtown Basalt.
Named Goodpeople, the dispensary is located in the Frying Pan Inn Building at 175 Midland Ave.
Though he diplomatically describes the effort of getting issued all the necessary permits as a learning process, you can hear both a sigh of relief and a tinge of exasperation as Lacroux utters those words.
The first, and most daunting, obstacle came about because, even though medical marijuana was approved by 56 percent of Colorado voters in 2000, marijuana in all its forms is still listed as a Schedule-1 narcotic by the federal government, alongside heroin, LSD, psilocybin and methamphetamine. Consequently, many marijuana businesses have trouble getting basic services from banks that are insured by the federally insured FDIC.
Within 24 hours of announcing that he had applied to the town of Basalt for a medical marijuana retail license, Lacroux’s fiscal world was turned upside-down.
“I got a notice from the bank where I had been doing business for years that they were closing all my accounts,” Lacroux said in an interview in November 2017. “And I mean all of them. Not only the accounts I had for my various businesses, but also my personal accounts. Even my kids’ college funds. I had been doing business with that bank for years and the amount we are talking about was up in the millions.”
Lacroux was stunned and pissed off.
“I don’t want to name names, but the branch manager of the bank where I had my personal and business accounts had come out on the record in Basalt as being against marijuana,” Lacroux said. “I think it is more than a coincidence that, shortly after our announcement, he notified us that he was closing our accounts. I think we had two weeks to make other arrangements.”
Lacroux scrambled to find a new bank. He did, but, shortly after opening new accounts, he was informed that, once again, because of his association with the marijuana industry, those accounts would also be closed. This, Lacroux was fast to point out, occurred before his license to open a medical marijuana dispensary had even been considered by the Basalt Town Council, much less approved.
He said that the banking issues have finally been, if not exactly resolved, then at least addressed sufficiently enough that he can open Goodpeople.
“On the over-arching global scale, the banking issues have not been completely resolved,” Lacroux said. “But we have established banking relationships that allow us to operate. We are working with legitimate banks. All of our other business banking is completely separate. It took us two-and-a-half years to get to this point.”
There were other issues — among them, opposition from several of the other tenants who own units in the Frying Pan Inn building.
He and Streeb also had to convince the Basalt government to allow a medical marijuana dispensary to operate in the town’s Vitality Zone, which was established in 2009. That zoning designation requires that new uses on the first floor of buildings located on Midland Avenue, Basalt Center Circle and a portion of Two Rivers Road are required to be “Community Vitality Uses,” which include retail, restaurant and personal services. The idea, as the zoning designation’s name indicates, is to encourage the kinds of businesses that inspire foot traffic and the spending of money in downtown Basalt.
Recreational marijuana dispensaries were considered legitimate operations in the town’s Vitality Zone. But medical marijuana dispensaries were not.
Then there was an issue with the submission of a plat — not for the issuance of a medical marijuana license on the town level, but to satisfy zoning requirements.
“That was on us,” Lacroux said on Tuesday. “It pushed us back a bit.”
On a state level, Lacroux and Streeb had to deal with a legal requirement that mandated all medical marijuana dispensaries need to establish pot-procurement relationships with certified medical marijuana grow operations, rather than being able to buy wholesale product on the open market. It took some doing, but the two finally inked a deal with Denver-based grower Newt Brothers.
That deal, though ongoing, became legally moot on July 1, because, according to Lacroux, the state regulations requiring verifiable vertical relationships between medical marijuana growers and retailers were changed, to allow retailers to procure medical marijuana on the open market.
Last, but certainly not least, Lacroux and Streeb have had to shell out some significant cash just to open the doors of Goodpeople.
In addition to a complete renovation of the physical facility, the twosome had to shell out $2,500 just to apply for a medical marijuana license in Basalt — with no guarantee that their application would be accepted. They also had to spend an additional $1,500 to apply to the town for a special review application.
Just applying to state for a basic medical marijuana retail license can cost between $9,000 and $22,000 — depending on the number of patients that will be served at the facility.
As of July 1, that effort has finally paid off. The doors are open.
“It is a relief,” Lacroux said. “We have learned a lot. We consider the effort important because we are here to help people, and we are here to help Basalt.”
The dispensary’s name says it all, according to Lacroux.
“It’s a good name,” he said. “We all say it. He’s ‘good people.’ Or ‘she’s good people.’ It’s the right term that was inspired by the Widespread Panic song of the same name.”
Though Lacroux and Streeb are no longer legally required to maintain a relationship with Newt Brothers, they have chosen to do so.
“This gives us the opportunity to sell products that we are familiar with from seed to sale,” Lacroux said. “Newt Brothers is an artisanal grower with a great reputation. We will be taking a different approach, in that we will really be trying to educate our clients, not just on the varieties but on the legalities. We will be going past the usual sativa and Indica blends. We will be asking our clients what they are looking for, what they really want. We will be offering terpene profiles that are specific to the desires of our customers. So, if it’s helping a customer to sleep or to be more creative, we will offer terpene profiles for that.”
(According to the pot-based website leafy.com, terpenes are “Secreted in the same glands that produce cannabinoids like THC and CBD. Terpenes are aromatic oils that color cannabis varieties with distinctive flavors like citrus, berry, mint and pine.”)
Newt Brothers, which supplies almost 100 medical marijuana dispensaries, including numerous in the Roaring Fork Valley, will be supplying Goodpeople with a wide variety of strains, including concentrates and edibles.
Looking to support other businesses
Lacroux and Streeb are also in the process of trying to open a recreational marijuana retail establishment, which, if approved, will operate upstairs from Goodpeople.
They bought the recreational license from Jack Pease, whose combination recreational/medical operation, which had been located on the Three Bears Building on Midland Ave., went out of business.
“If all goes well, we hope to open that by the end of the year,” Lacroux said.
Lacroux said he and Streeb are very serious about making their proposed medical marijuana operation a positive component of Basalt’s business community.
“In addition to the increased sales tax revenue, we intend to distribute coupons to use at other businesses, like bars and restaurants,” Lacroux said. “Hopefully, our customers will use those coupons, which means other businesses will see a direct benefit.”
When Amendment 64, which legalized recreational marijuana in Colorado, was passed in 2012, Basalt determined that it would allow two retail recreational marijuana dispensaries and two retail medical marijuana dispensaries within the town limits.
RootsRX, which has blossomed into a statewide conglomerate, jumped on the first recreational license in Basalt shortly after Amendment 64 was enacted in 2014. RootsRX now runs a store at 165 Southside Drive.
At this point, there is now one remaining medical marijuana license available in Basalt.