Commissioners delay adopting permanent MMJ rules

May 24, 2011

The regulatory cloud of confusion that has surrounded the medical marijuana industry in Colorado for several years hasn’t cleared yet.

El Paso County officials decided Tuesday to take another week to consider modifications to local policies and fees. The county’s new rules will take affect July 1, at the same time 73 pages of state regulations are implemented under the Colorado Medical Marijuana Code.

Saying they need more time to study the changes proposed by the county attorney’s office, county commissioners postponed adopting permanent regulations governing marijuana businesses in unincorporated areas until their May 31 meeting. The public meeting will start at 9 a.m. at the County Administration Building, 27 E. Vermijo Ave.

Commissioners are working from an 11-page local Medical Marijuana Policy, which they adopted as temporary last August, along with zoning regulations.

At Tuesday’s meeting, commissioners not only questioned some of the proposals but demonstrated how perplexing the fledgling industry is.

For example, no one could remember why local licenses are on track to be issued every two years, instead of renewed annually.

Assistant County Attorney Lori Seago said the county’s liquor code has the same fee timetable, and state statute allows for medical marijuana licenses to be issued every other year.

Commissioner Sallie Clark asked why a requirement for 24-hour video camera surveillance of businesses is slated to be removed from the policy.

Seago said the intent is for the local policy to not duplicate the state’s mandates, which have strict surveillance requirements. 

Instead of requiring a neighborhood survey for a new or relocating business, Sheriff Terry Maketa said he would rather have law enforcement assess potential criminal activity in the area of a proposed location.

He also favors lifting sanctions on transporting locally grown medical marijuana outside the county because that activity will be closely monitored by the state, and the county could reap additional sales tax revenue by allowing it, he said.

The industry generated nearly $250,000 in sales tax revenue for the county in 2010, according to estimates. April’s take was about $30,000, the most for one month.

The county’s new policy also suggests lifting a ban on separate grow sites that are not connected to a dispensary, but charging independent growers a higher annual licensing fee of $5,000, compared with $3,000 for infused-products manufacturers and small dispensaries.

All businesses would pay substantially more under the proposed new fees, which are being adopted in concert with state action to move businesses from temporary status to permanent licensing. 

Existing businesses paid $163.50 for a county temporary-use application filed before May 9, 2010, and another $737.50 after fee revisions were enacted. 

With permanent licensing, the county is considering charging $3,000 to $7,000 in licensing fees, depending on the size and type of business. One-time application fees, if approved by commissioners, will range from $170 per person for background checks to $1,270 for a change of location to $1,520 for a new license.

Seago said the fees are designed to recoup costs of monitoring and policing the industry.
Maketa said that businesses in the unincorporated areas of the county have not been a problem for his office because of the county’s temporary land-use regulations, in place since 2009.

Maketa also reminded commissioners that medical marijuana is still illegal on the federal front. Although voters in some states, such as Colorado, have approved its use, “the bigger picture is that the federal government is still struggling with this whole concept,” he said. “It’ll come down to state powers versus the federal government.”

Colorado lawmakers are continuing to add more regulations, such as those in House Bill 1043, which is awaiting a signature from the governor. Among other stipulations, the bill would extend the moratorium on new business licenses another year, to July 1, 2012.

After July 1 of this year, the state will begin processing applications for licenses that were filed with the state last summer, before the first moratorium on new businesses was enacted. 

The state has applications for licenses from 206 centers and infused-product manufacturers in Colorado Springs, 11 in El Paso County and four in Teller County, according to Julie Postlethwait, spokeswoman for the state’s Medical Marijuana Enforcement Division of the Colorado Department of Revenue. The division does not release publicly the number of growers. 

Two-year state licensing fees, which must be paid on top of local fees, range from $7,500 for small centers with fewer than 300 patients to $18,000 for centers with more than 500 patients.

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