Dispensaries get rules in a cloudy climate

Littleton passes ordinance on medical marijuana shops, but future of businesses still unclear

Posted 1/24/10

Uncertainty and controversy surround medical marijuana dispensaries in Colorado. As the state and nearby municipalities grapple with the issue, …

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Dispensaries get rules in a cloudy climate

Littleton passes ordinance on medical marijuana shops, but future of businesses still unclear


Uncertainty and controversy surround medical marijuana dispensaries in Colorado.

As the state and nearby municipalities grapple with the issue, Littleton seemingly has brought some order to the industry within its borders.

On Jan. 19, the city council passed an ordinance regulating dispensaries in Littleton. But the new rules, passed just a week after Denver approved a similar ordinance, do not come without some uncertainty and controversy of their own.

The ordinance, approved by a 6-1 margin on final reading, limits the number of dispensaries in the city to four — which is the number of shops presently operating.

Other rules established include licensing procedures; mandatory distances from schools and other dispensaries; security requirements; and the amount of floor space that can be used to grow marijuana.

Crafted over a two-month period, the ordinance is among the first in the Denver metro area to address dispensaries, which have proliferated only since the summer of 2009.

“At the end of the day, I think it’s a good, solid piece of legislative work,” Councilmember Bruce Stahlman said.

Stan Zislis said he appreciates the council’s labor on the issue but the end result falls short.

“They ignored the voices of the people who spoke before them,” said Zislis, who planned to open a dispensary on Arapahoe Road in Littleton.

More than 20 people voiced their views for a combined two hours during the public hearing portion of the Jan. 19 city council meeting. Most of those who spoke were affiliated with a dispensary, citing a need for a change in the ordinance in some fashion.

After the hearing, council made amendments to the ordinance before final approval, but did not modify the items that drew the most protest.

Members of the general public weighed in as well. Sources of comment ranged from a wounded combat veteran who uses marijuana to manage chronic pain to a senior citizen who said cannabis is corrupting the nation’s youth.

How many is enough?

Some who spoke at the public hearing said the allowable hours of operation — 9 a.m. to 7 p.m., seven days a week — aren’t enough. Others took issue with the 20 percent limit on a dispensary’s floor space that can be used to grow marijuana.

The ordinance’s cap of four on the number of dispensaries, however, has caused the most buzz, largely because five additional businesses were granted sales-tax licenses.

Councilmember Jim Taylor — who represented the lone dissenting vote — said all nine have the right to operate and raised the possibility of lawsuits against the city.

“Because they had all been approved by the city, they should all be allowed to open up in the city,” Taylor said.

Mayor Doug Clark said not all the sales-tax licenses were issued before the city’s 90-day moratorium on new dispensaries was enacted Nov. 3. Four dispensaries are sufficient to meet patients’ needs in Littleton, he said.

Stahlman said the council was faced with the balancing act of meeting legitimate demand versus creating an increased demand, and he agreed that four is a good number.

“It’s much easier to start with a smaller number and increase it down the road than it is to start with a larger number and decrease it,” Stahlman said.

Zislis disputes the need for a cap, which apparently will keep him from opening his dispensary, CannaMart, in the city.

“They should let the market regulate how many dispensaries are going to be here,” he said.

“I believe officials are enforcing their own biases.”

CannaMart recently filed a lawsuit against the City of Centennial after the location there was closed down. The lawsuit also asked for — and ultimately was granted — a preliminary injunction that would allow the business to reopen while the suit runs its course.

Zislis said he is reviewing his options as they relate to his Littleton location.

Getting a license

In Littleton, it is not certain that when the dust settles, the dispensaries now open will be left standing.

“It’s possible that some of the first four may not make it through the licensing process,” Clark said.

At the Jan. 19 meeting, an ordinance was approved that changed the name of the Liquor Licensing Authority to simply the Licensing Authority and expanded its jurisdiction to include dispensaries.

A resolution also was passed that established the fees for dispensaries’ applications and licenses. Included are a $2,500 application fee and an annual $2,000 license fee.

An additional small fee is included to cover the cost of a criminal background check. No one with a 5 percent or greater ownership interest or any manager of a dispensary can have a felony conviction on record.

Safety first

Part of the ordinance’s intent, as stated in its introduction, is to preserve the city’s “family friendly character.”

“One of our overriding obligations is to honor our responsibility for the health, welfare and safety of our citizens,” Stahlman said.

Dispensaries across the Denver metro area have been linked to crimes in recent months, mainly as victims of robberies and burglaries. But a Littleton police officer reported that no crimes have been directly related to the businesses in the city.

One of the security measures the ordinance mandates is the use of surveillance cameras by dispensaries.

Janene Nachtsheim believes one of the best ways to promote safety would be to allow businesses like hers to grow all of their own marijuana, which she said is not possible using one-fifth of the facility. It would help ensure quality control and keep away a potential criminal element, she said.

“By limiting it, we are not able to provide all the medicine for our patients,” said the owner of Mother Nature’s Miracle, located on Littleton Boulevard. “We have to outsource.”

Nachtsheim only buys from known, reputable sources, she said, but fears others are tempted to purchase from more questionable individuals.

Nachtsheim said her dispensary does fit in with the family environment of the city and cited the ordinance’s restriction on age — no one under 18 can enter the shops. It also keeps the businesses 1,000 feet or more away from schools.

What’s next?

Littleton is far from alone in its effort to regulate dispensaries.

Neighboring Englewood and Centennial have moratoriums on new dispensaries while they mull courses of action. Meanwhile, possible legislation at the state level could change the entire medical marijuana climate in Colorado.

For example, state Rep. Tom Massey, R-Poncha Springs, has been expected to introduce a bill that would limit to five the number of patients a caregiver could treat.

If such legislation were to pass, it could financially doom dispensaries, which presently can provide for dozens of patients.

“Everything would be run underground,” Nachtsheim said. “It would cause complete chaos.”

City officials and state legislators are confronting the dispensary issue because Amendment 20 — which Colorado voters passed in 2000, legalizing medical marijuana — did not.

The businesses started cropping up in large numbers last year for a couple of reasons.

In July, the Colorado Board of Health rejected a plan that would have limited the number of patients a caregiver could provide for to five.

While marijuana possession remains against federal law, in October, the Justice Department said it would not pursue cases against medical marijuana users and suppliers, as long as they followed state law.

Even if sweeping change does not come from the state, Littleton could revisit its ordinance and make alterations if the need arises, councilmembers have acknowledged.

Their weeks of work and compromise began shortly after the moratorium was imposed. Rather than extending the moratorium and waiting for the state, it was decided that rules needed to be established for a new industry that was poised to grow even as they spoke.

“We did, I think,” Councilmember Peggy Cole said, “the best we could.”


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