Colorado Springs News, Sports & Business

Colorado General Assembly approves marijuana regulations on last day of session

By Megan Schrader Published: May 9, 2013

Colorado's General Assembly wrapped up its 2013 session Wednesday with the passage of two bills to regulate recreational marijuana.

Legislators adjourned Wednesday about 4 p.m., and majority Democrats contentedly tallied up several landmark bills passed during the session, including same-sex civil unions, in-state tuition for students in the U.S. illegally, limits on the sales of high-capacity magazines and universal background checks related to gun sales.

In the final days of the session, lawmakers also hammered out a complicated regulatory and taxation scheme for the state's fledgling adult-use recreational marijuana industry.

But of a handful of oil and gas regulations - many aimed at hydraulic fracturing - only one successfully passed the Senate.

On the final day of the session, two marijuana regulation bills were sent to Gov. John Hickenlooper, who is expected to sign them.

HB1318 would let voters decide in November whether a special 10 percent sales tax and a 15 percent excise tax should be imposed on marijuana. The taxes would pay for marijuana regulation and school construction.

The other marijuana measure, HB1317, regulates how the state will grant business licenses to companies selling marijuana to adults for recreational use. It also says a person must live in Colorado for at least two years prior to obtaining a marijuana business license and says investors cannot be from out of state.

Under the measure, owners of existing medical marijuana businesses will be able to apply first for retail sales licenses.

Recreational marijuana stores could open as soon as January.

But Rep. Dan Pabon, D-Denver, said he doesn't expect a rash of stores to open immediately.

'What you're going to see, as a practical matter, is that most local jurisdictions will put a moratorium in place, ' said Pabon who spent much of the session crafting the marijuana regulation bills. 'We encourage local jurisdictions to have public hearings before these local restrictions are approved. '

Pabon said he was disappointed HB1317 passed on a party line vote in the House - no Republicans supported the bill.

But Rep. Frank McNulty, R-Highlands Ranch, said the marijuana bills, especially the taxation bill, fell short of the mark.

He was worried the marijuana taxes would fail at the ballot box, leaving no cash for schools and forcing the state to find money for pot regulation.

'It's not a question of the tax rate. It's an issue of making sure we protect education funding, ' McNulty said.

Lawmakers had a tougher time reaching agreement on oil and gas drilling regulations.

When asked what went wrong, Sen. Matt Jones, D-Louisville, laughed.

'A swarm of lobbyists, 20 to 25 oil and gas lobbyists, and the Department of Natural Resources generally lining up with those lobbyists and lobbying individual legislators, ' Jones said.

A Jones bill to increase the maximum fine for an oil and gas spill or violation from $1,000 per day to $15,000 per day died Wednesday as the session ended.

HB1267 was ensnared in an effort to set a minimum fine for violations. The House OK'd a $5,000 minimum. The Senate at first rejected a minimum outright, and a compromise was struck at $2,500. Sen. Greg Brophy, R-Wray, asked his colleagues to reject the minimum fine.

Ultimately the Senate agreed with Brophy and rejected the compromise, killing the bill.

Hickenlooper signed an executive order Wednesday telling the Colorado Oil and Gas Conservation Commission to review fines and penalties in response to HB1267's demise.

'Colorado requires strong and clear enforcement of the rules and assessment of fines and penalties accordingly, ' the order said.

Another bill that failed to win over Senators was HB1316, which would have required the same ground water testing standards now required in the rest of the state to be used in the state's most active natural gas field. It died Monday in the Senate.

Opponents of that bill said that drilling is so dense within the Greater Wattenberg Area, along the Front Range between Denver and Greeley, that requiring four water samples per new drilling operation was overkill. Instead, new wells are required to have four water samples per square mile in the Greater Wattenberg Area.

Also killed was a measure to bar members of the oil and gas industry from sitting on the COGCC. The bill was amended to require that board members avoid conflicts of interest when voting on measures, but still died in the Senate.

Hickenlooper's office said he did not support additional water sampling in the Greater Wattenberg Area or the conflicts of interest bill.

Other measures discussed before session began - required setbacks for drilling operations from residential developments and allowing municipalities to regulate drilling - weren't introduced.

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Contact Megan Schrader: 719-286-0644

Twitter: @CapitolSchrader

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