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Medical marijuana: Ganjapreneur says Arizona easier to do business in than Colorado right now

With all the controversy over U.S. Attorney John Walsh's letter criticizing part of HB 1043, a medical marijuana bill intended to clean up some of last year's regulations, local members of the MMJ industry are both confused and concerned. No wonder one well-known area gangjapreneur, Brian Cook, prefers doing business in Arizona rather than Colorado right now.

Cook's had some unpleasant experiences with Colorado bureaucracy during the past year. Last June, he accused two members of the Denver City Council -- Carla Madison and Doug Linkhart, now a Teapot Party-endorsed mayoral candidate -- of pushing an amendment that led to the closure of his Altitude Organic Medicine dispensary over a zoning change. He initially threatened a lawsuit against the city due to its actions, but eventually focused on licensing the AOM brand to other medical marijuana centers and fighting against an attempt to prohibit retail MMJ in El Paso County. In the end, voters turned thumbs-down on the proposed ban.

A photo of Altitude Organic Medicine's now-closed Denver location.
A photo of Altitude Organic Medicine's now-closed Denver location.

These days, Cook still lives in Colorado, where three dispensaries license the AOM moniker -- one in South Denver and two in Colorado Springs. (He also has a licensing pact with a dispensary in San Diego.) But he says "our headquarters is now in Scottsdale, and we're finding it advantageous to attach primarily to Arizona."

Why? "We look at the rules and regulations as being better than in Colorado," he maintains. "You can centrally distribute from one cultivation site in Arizona to a number of stores." In contrast, he points out, Colorado instituted the 70-30 rule, which requires each dispensary to grow at least 70 percent of its products, while obtaining up to 30 percent from other sources.

As such, Cook hopes to go beyond licensing the AOM brand in Arizona to "a management-company model. It'll be a streamlined retail presentation with mandated standards, where all the products will be tested scientifically and there'll be a little more control from the management-company side. The businesses in Arizona will be independently owned, but we'll be the management company, bringing in the how-tos, the point-of-sale software and unifying the retail presentation so you'll have the same products at all the stores. That way, you'll get the same experience."

Of course, Arizona presents other challenges -- such as limiting the number of licenses granted to 124. "It's highly competitive," notes Cook, who expects that seven to fifteen applicants will submit license applications using the AOM model. Applications are due between June 1 and July 1, he adds, with the state informing those it approves in August.

Although Cook would love for all of the dispensaries using the AOM approach to be blessed by Arizona, he admits this may be wishful thinking. Those that are, however, will benefit from "limited geographical competition," he says, "and you'll have all the rules in advance," unlike in Colorado, where businesses were already operating when regs were imposed.

"I'm proud of Colorado," he stresses, "but it's just the timeline of things. One place experiments, and the next place figures out how to do things by making fewer mistakes. And I think Arizona has learned from Colorado's experiment."

More from our Mile Highs and Lows archive: "Mile Highs and Lows: Altitude Organic Medicine."


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