OURAY COUNTY – The Obama Administration’s announcement last Thursday that it will not challenge new laws legalizing marijuana in Colorado and Washington has created a profound shift for medical marijuana companies across this state, including the Ouray County-based Acme Healing Centers.
The news came in the form of a long-awaited memo, issued by Deputy Attorney General James M. Cole, stating that although marijuana remains illegal under federal law, the Justice Department will opt not to target individual users but rather will focus on eight areas of enforcement, including distribution of marijuana to minors, preventing retail pot from crossing state lines into states where it is still illegal, and keeping marijuana out of the hands of cartels and gangs.
In essence, the feds have given Colorado’s government-backed task force a green light to continue setting up the regulatory framework for a marijuana market in Colorado, and for companies such as Acme to continue preparing to shift a portion of their operations into retail sales, so long as Colorado can enforce the rules that it develops.
“It seems like a lot of doubt has been relieved,” Acme Healing Centers Manager David Niccum said. “As long as you police yourself and the state is able to police you, you can do business, which wasn’t the case a few weeks ago. A lot of people who were waiting can now move forward.”
For example, Niccum said, in Durango where Acme has one of three dispensaries, “there is a lot of interest now” among potential landlords who before were afraid to lease to a marijuana-based business. “A lot of people have been sitting back, and now a lot of doors are going to start opening up,” Niccum said. “The letter [from the Attorney General] has put us at ease for sure.”
The recent news from the feds is the biggest thing to happen to the movement to legalize pot since voters in Colorado and Washington opted to legalize the sale or possession of less than an ounce of marijuana in their states last November. But Niccum and his colleagues in this state’s marijuana industry have also been focused on preparing for Oct. 1, the date when existing medical marijuana dispensaries in Colorado can submit applications to the state to convert to recreational sales.
The next big date after that is Jan. 1, 2014, when the licenses will be issued and MMJ dispensaries can start conducting business as a retail marijuana facilities in jurisdictions that allow them to do so. (Amendment 64 allows local jurisdictions to decide for themselves whether to permit retain marijuana in their communities.)
Acme’s three existing medical marijuana dispensaries in Crested Butte, Durango and Ridgway are all poised to convert to hybrid MMJ/retail enterprises, Niccum said.
Niccum reported that all three municipalities have been supportive and cooperative in passing local legislation that eases Acme’s transition from strictly medical dispensaries to more commercially oriented businesses.
The Town of Ridgway is leading the way, having already written and passed an ordinance governing retail marijuana sales in its jurisdiction. Crested Butte is in the process of writing up its own regs, as well, while the Durango City Council just approved a moratorium of business licenses for the sale of non-medical pot through June 30, 2014 to give staff time to coordinate local regulations with new state law.
Acme supplies its three dispensaries out of a grow facility south of Ridgway, where it currently cultivates dozens of strains of marijuana. Security here is top-notch, meeting or exceeding the State of Colorado’s medical marijuana enforcement division requirements on all levels, with a high fence, multiple security cameras, “and a guard dog,” Niccum added.
“We run a really tight ship, and we are very proud of it.”
Current laws regulating the cultivation of medical marijuana in Colorado allow Acme to grow a limited number of plants only for its own patients that it services through its dispensaries. Come January 2014 Acme’s pool of potential customers will grow exponentially to encompass recreational demand, but its grow operation will still be limited, in the short term, due to a one-year moratorium which the Ouray County Commissioners just passed on retail pot operations in the county.
The moratorium grandfathers in the Acme grow facility, and allows Acme to divert a portion of the plants it currently grows toward retail pot. But until the county moratorium expires, Acme will have to maintain its current level of plants, with no expansion allowed.
The term for what is happening at the grow facility is “vertical expansion,” Niccum explained. “We can grow retail marijuana and medical marijuana in Ouray County at the same time,” he said. The two endeavors will take place in separate parts of the grow facility.
Things are definitely still in flux at the state level in regard to retail marijuana regulations and how many plants Acme will ultimately be allowed to grow; legislators have pushed through a set of emergency rules, to which “constant updates” are still being made, Niccum said. “For now, we are still in a holding pattern. But we already had a victory, with Ouray County writing an ordinance stating we would be allowed to grow retail pot even though our application has not yet been submitted to the state.”
Niccum said he is optimistic about Acme’s prospects at the state level too. “As long as we are in good standing, there should be no issue going to retail,” he said. “We don’t expect any denials.”
Niccum said Acme plans to retain the medical marijuana business model it has already successfully developed, while determining how to integrate retail pot sales.
“Retail marijuana is still in its very early in stages and we are not going to make our MMJ patients suffer for that; it’s still a priority,” he said.
According to state regs that have already been developed, if MMJ dispensaries agree to sell to individuals only over the age of 21, they can sell retail pot out of the dispensary. This is the route that Acme is currently planning to pursue. Another alternative would be to open two different rooms in the same building, which Niccum said is a less desirable option.
“We are still in a holding pattern regarding which direction we are going to go, but it’s easier when you have great local officials who understand our needs and are helping us to do it as best we can,” he said.
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