Denver Wants to Tax Medical Marijuana

Two Denver councilmen back medical-marijuana sales tax

By Christopher N. Osher
The Denver Post

Posted: 11/03/2009 01:00:00 AM MST
Updated: 11/03/2009 01:40:20 AM MST

Denver City Council members Charlie Brown and Chris Nevitt are polar
opposites on how much regulation the burgeoning medical marijuana
industry should face.

Nevitt doesn't understand why Brown is pushing for more regulation.
Brown can't understand why Nevitt doesn't support requiring marijuana
dispensaries to apply for a license similar to what establishments
serving liquor must seek.

But on one issue the two council members are in agreement: They both
think the city should start seeking sales tax revenues from those
dispensaries selling medical marijuana.

"We're leaving a lot of money on the table," Nevitt said.

The council members made their views known Monday during a committee
meeting on the subject.

State Sen. Chris Romer, a Democrat from Denver, said the state
legislature likely also will decide whether to fashion a "robust
regulatory" framework for the industry in the next General Assembly
session.

The city's treasury department still isn't sure how to handle those
medical marijuana dispensaries seeking a sales-tax license. The city
attorney's office is still analyzing the taxation issue after the
treasury department asked for an opinion in August.

Voters in 2000 approved Amendment 20, which made Colorado one of 14
states to approve the use of medical marijuana. But the law didn't
mention how those using medical marijuana would get the drugs.
Dispensaries are setting up shop, contending that as a patient's
"primary caregiver," they deserve protection under the law.

On Nov. 18, Brown will seek support from a council committee for his
proposed regulatory system.

Under his system, the dispensaries would have to justify through a
public hearing a "needs and desire" requirement for the surrounding
area.

A hearing officer would weigh testimony from nearby residents and
business owners along with the testimony of advocates. The department
director then would review the hearing officer's recommended decision
before issuing a final ruling.

Operators of dispensaries also should have to undergo a federal criminal
background check to ensure they have no felony convictions, Brown said.
They would pay a nonrefundable licensing fee of $2,000 and a $3,000
annual renewal fee, Brown added.

Nevitt said he sees no need for increased regulation other than to
ensure medical marijuana used in food, such as brownies, is prepared
safely.

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Christopher N. Osher: 303-954-1747 or cosher@denverpost. com

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