Denver Extends New Business Moratorium for 4 Months

On Nov. 24, 2015, Denver officials narrowly avoided renewing a blanket two-year moratorium on new recreational marijuana businesses in Denver and a full ban on new medical licenses. Instead they opted for a four-month extension of the existing ban to study the impact of the current businesses in the city and how many more licenses should be issued.

For the last two years since the recreational market began in Colorado, only existing medical marijuana businesses have been able to open recreational shops or become edibles manufacturers. The restrictive ban on the industry was set to be lifted on Jan. 1, 2016, but the city proposed extending it for another two years, in part because of the preponderance of marijuana stores already operating in the state’s capital. More than 40 percent of all marijuana stores in the state are located in Denver.

Denver Mayor Michael Hancock’s marijuana policy office asked the Denver City Council to delay this new licensing period for 120 days so the city can study its own data. In the meantime, new license approvals, even for medical dispensaries, are also on hold.

This move immediately motivated the local industry, many of whom were present at last week’s 90-minute council meeting to contest even this delay. The additional four-month moratorium imposed by the state will cost those currently in the approval process, at minimum, a delay on plans that include lease agreements and application fees paid to the state.

“It’s downright irresponsible to extend this moratorium at this late date,” said Loren Davis, a lawyer specializing in marijuana law. “There are tens of dozens of business owners who have planned on that Jan. 1 deadline.”

That is not the only consideration that the City Council will listen to, however. It will also consider the impact on the local neighborhoods in which the stores and dispensaries operate, and not all of them have happy residents, some of whom complain of being “overrun” by the preponderance of a new and still controversial industry.

Denver currently has 440 marijuana businesses operating within city limits for a city of about 650,000 residents, which equals one marijuana store or dispensary for every 1,477 residents.

Despite a continued steady pace of new business openings, however, the city’s medical usage rates and patients have not noticeably increased.

The question of marijuana tourism, including medical tourism in the state, is still also in a strange limbo. For now, it is not a topic that official tourism promoters in any state will even touch outside of Nevada and Hawaii, both of whom are gearing up to attract a steady tourist trade. In fact, in Colorado, Denver’s International Airport made headlines last January for banning marijuana-themed t-shirts and flip-flops from being sold on airport grounds.

However, without an influx of a new source of consumers from somewhere, it is unlikely that the marijuana market will ever be so open to newcomers again because there is already a preponderance of hundreds of outlets.

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