The Cortez City Council has voted to rescind an amendment to its medical-marijuana ordinance that put a cap on how many marijuana centers could operate within the city.
The council decided to stay with the original ordinance that puts strict zoning regulations on centers, which effectively limits the number that can operate anyway.
In June, council members agreed that Cortez should have no more than three centers, based on recommendations from an ad hoc committee that studied the marijuana issue, but in July they backtracked on the limit, saying it was unfair.
“We originally thought that three was all the community could support as far as customer traffic, but then we were faced with a fourth medical-marijuana center whose owner had made quite an investment and was wanting a license,” explained council member Karen Sheek.
“So the question became, how do you decide who are you going to put out of business? We want to encourage business and grow our economy, not drive businesses away.”
The three-limit cap seemed arbitrary and unfair in retrospect, Sheek said, leading to the reversal in policy.
City Manager Shane Hale explained that rather than regulate by a cap, the council opted to control the number of centers by zoning and distance.
According to city code, centers can only be operated within commercially zoned areas and must be 1,500 walking feet from each other and from campuses, child-care centers and schools.
Based on those physical limitations, city staff estimates there couldn’t be more than five or six centers in total within Cortez. Currently, there are three licensed centers with a fourth center seeking a new location that complies with regulations. At one point, Cortez had six medical-marijuana centers, with two going out of business.
“We didn’t want to have a little Amsterdam effect here in Cortez,” quipped Hale, “so regulating by zoning and distance seemed like a good balance. We went beyond the 1,000-foot distance requirement that the state requires.”
Montezuma County commissioners previously voted to ban medical-marijuana centers outside city limits. Under the Colorado medical-marijuana laws, private users with state authorization are allowed to grow up to six plants for personal use or for sale to established state-sanctioned patients.
To allow time for regulations and codes to be adopted, medical-marijuana centers operating in the city were put under a moratorium last year. Once the ordinance was adopted outlining distance and zoning requirements, two centers were found to be out of compliance.
The new rules disrupted commercial operations for centers already in business and added an extra expense.
Medical-marijuana centers in Cortez must pay a one-time $2,500 application fee, and then another $750 license fee each year. But, if a facility moves, it must pay an additional $1,500 fee for city costs associated with authorizing a new location.
Herbal Alternative realized they were within 1,500 feet of another center, Medicine Man, and moved operations to another commercial area on Lebanon Road.
As individual towns wrestle with appropriate regulations, business owners must endure the shifting policies, testing patience.
“We’ve sunk a lot of money into our new facility and we would like to get started,” said Garrett Smith, the new owner of Herbal Alternative, during a July 10 city-council meeting.
“I understand Mr. Smith’s concerns with the delay. He is in business and wants to start selling his product,” said Cortez Mayor Danny Porter.
Herbal Alternative was granted a license to operate at their new location July 24.
Also, True Earth Medicine, located off Broadway, found themselves too close to the Piñon Project, which has a day-care and preschool facility, when the new rules were introduced. They are in the process of moving to a new location, and must cease operations at their current location Oct. 23, Hale said.
“I think the amount of time the council has allowed for centers to comply shows a real business-friendly approach,” Hale said.
“We’ve found a new location that meets the requirements,” reported True Earth Medicine owner C.J. Murphy during the July 10 council meeting. The city is waiting for a change-of-location application to begin the authorization and building inspection process.
Both business were forced to move, or become out of compliance with city code. Both had paid the $2,500 initial permit application fee and the $750 yearly license fee, and now were faced with the additional $1,500 fee for relocating.
In June, two other facilities, Beacon Wellness and Medicine Man, were given the green light under the new rules.
Hale said he has been impressed with the professionalism and patience of medicalmarijuana operators. Speaking of a tour of Herbal Alternative, Hale said it “was an impressive facility, state-of-the-art.”
Hale justified the application fees as covering labor costs of city staff to inspect centers for compliance and process applications. The yearly $750 is to cover the extra time it takes for city police to conduct monthly inspections of each center.
“We conducted an audit to determine how much extra staff time it required to process the applications and so the fees cover those labor expenses,” Hale said. “We feel it is reasonable.”
State requirements are stringent as well for medical-marijuana centers. Grow areas must be attached to retail stores, inventory is limited to a certain amount, security must include 24/7 video surveillance, and patient access and purchasing is strictly regulated.
Council member Sheek is satisfied with the final ordinance regulating the industry.
“It allows us to provide access to those in our community who need this product for health reasons,” she said.
“Plus it allows us to know where these businesses are and regulate them closely. Whereas if the product is only available through private caregivers the regulations are not nearly as stringent as those operating centers.”
