Staff members of Medicine Man marijuana dispensary take care of customers at the Denver shop in January 2014. (Denver Post file)

Denver scales back plan to bar new players in marijuana industry

Denver officials pulled back Tuesday from immediately seeking another two-year moratorium on new players in the city’s legal marijuana market, approving instead a four-month extension to study the issue further.

Only existing medical marijuana businesses have been able to open recreational dispensaries, grow houses or edible manufacturers during the first two years of retail pot sales in Colorado.

That restriction was set to expire Jan. 1, but the city proposed extending it for two more years. Some marijuana business leaders and advocates have objected to the extension, saying it interferes with the market, while others have been more receptive.

Mayor Michael Hancock’s marijuana policy office on Tuesday asked the City Council’s five-member Business Development Committee instead to approve a 120-day extension on license restrictions.

Committee members agreed that the shorter extension gives them time to review critical industry data.

The committee also agreed to stop accepting applications for new medical marijuana licenses for 120 days. Applications in process before Jan. 1 will be processed. The full council likely will vote on the proposal in coming weeks.

Several marijuana business owners at Tuesday’s 90-minute meeting said limiting the market even for a short time creates problems for those entrepreneurs looking to get into Denver’s pot market.

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

Those plans have included expensive leases on buildings and application fees at the state and local levels.

Although retail marijuana businesses have been limited to those already with a medical license, there has been an influx of applicants for medical licenses — with no appreciable increase in the number of medical marijuana patient registrations.

But Denver’s concentration of marijuana businesses — about 40 percent of all the state’s licensees are in the city — has city officials wanting to take a pause before allowing additional licenses to be issued.

“We’ve been successful for taking our time and doing this right at all levels,” Councilman Paul Lopez told the committee. “This is still the right way.”

Although the city’s office of marijuana policy backed away from asking for a two-year moratorium on new licenses, mayoral adviser Ashley Kilroy said the objective through May is to decide whether that limitation should happen after all.

“We want more time to study the impact of the industry and allow the city time to adjust to more than 440 marijuana businesses here,” Kilroy said.

Resident Vernon Hill said his area of Globeville, on the city’s north side, already carries an abundance of pot-related businesses, many close to residential neighborhoods.

“We’ve been overrun,” he said in supporting a moratorium. “It’s not consistent with the Globeville (revitalization) plan. People are trolling through Dumpsters looking for discarded (pot) products.”

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