Yesterday the Colorado Department of Revenue mailed its first batch of licenses to businesses that plan to produce, test, and sell marijuana products for general use. The licensees include 136 retailers, all of which currently operate medical marijuana centers (the only businesses allowed to apply for licenses at this point); 178 cultivation sites, most of them linked to pot shops (which initially have to grow at least 70 percent of their inventory); 31 manufacturers of marijuana-infused products; and three testing facilities. The state seems to have approved every application it has received so far. The stores are allowed to open as soon as January 1 (a week from tomorrow), provided they have received approval from the local jurisdictions in which they operate.
The first pot store to receive a local license was Annie's in Central City, part of the Strainwise chain, so it will be among the stores authorized to open on New Year's Day. The Colorado Springs Gazette reports that Michael Stetler, owner of Marisol Therapeutics in Pueblo, also expects to have a local license by then. The Gazette says "Stetler has big plans for opening week, anticipating a rush of patrons from nearby counties and cities that have banned recreational sales, including Colorado Springs [the state's second biggest city] and El Paso County."
Three-fourths of the pot stores that have been granted state licenses are located in Denver, Colorado's capital and largest city, but it is not clear how many will be locally licensed and ready to open next week. The Denver Post reports that only eight Denver pot shops "have so far cleared all the hurdles in the local licensing process."
Leaders of the campaign for Amendment 64, Colorado's legalization initiative, say the first sale by a newly licensed pot store will happen at 8 a.m. on New Year's Day at "a Denver marijuana retail store that includes an on-site marijuana cultivation facility." The specific location has not been announced yet. The first buyer will be Sean Azzariti, "a U.S. Marine Corps veteran in Denver who can now legally use marijuana to alleviate the symptoms of post-traumatic disorder," a condition that was not covered by Colorado's medical marijuana law.
Although Azzariti appeared in an ad for Amendment 64, he is hardly typical of the new marijuana market, which will be driven by recreational users. As of next week, anyone 21 or older will be allowed to buy up to an ounce of marijuana at a time (a quarter of an ounce for visitors, in case you were wondering). But since cultivation for recreational use won't be allowed until January 1, and it takes about five months to grow a new crop, where will the pot for these new customers come from? Until next spring, it looks like the only legal source will be repurposed medical marijuana.
A medical marijuana center is allowed to grow up to six plants for each patient who names it as his designated provider. But that does not mean every patient consumes that much marijuana. Wiggle room was built into this system, since patients do not have to buy exclusively from their designated providers and dispensaries may sell as much as 30 percent of their marijuana to other outlets. Any dispensary interested in the recreational market has had more than a year since Amendment 64 was approved to maximize production under the existing quotas.
Will that be enough? Maybe not. Norton Arbelaez, co-owner of RiverRock Wellness dispensaries in Denver, told the Post he does not plan to start serving the recreational market until February. "There are just so many questions in terms of pricing, is there going to be scarcity, or some kind of lack of product in January that is going to lead to the price of the product doubling or tripling?" he said. "There's a lot of unknowns."
Another Denver dispensary owner, Ralph Morgan, told the Gazette he and his partner, Tim Cullen, plan to open next week, assuming they have their local license by then. But they are not planning to make a big deal out of it. "We're not inviting media," Morgan said. "We're not blasting things out on social media….A lot of it has to do with our supply chain, because we're mandated to grow 70 percent of what we sell…If our business were to double we would run out. We would have to close midmonth, and we're not unique in that. Everyone is in that same boat."
If the shops run out or the prices prove prohibitive, there is another option for those who planned ahead or have friends who did. Since Amendment 64 took effect in December. Coloradans have been allowed to grow up six plants at home and share the produce with others, up to an ounce at a time, as long they do not make any money from the hobby.