The history of cannabis in Colorado...or how the state went to pot

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Although both Oregon and Washington state also have marijuana legalization measures on the ballot, Colorado's looks like it might have the best chance of passing, with polls in late October showing voters equally divided.

What would happen if Amendment 64 is approved?

Even though the amendment would be in the Colorado Constitution, it would not supersede the federal Controlled Substances Act, nor make marijuana in any way legal at the federal level. Getting popped federally for cultivation could still net a quarter-million dollars in fines and up to five years in prison. But 64 would create a buffer for use and possession of limited amounts in Colorado: State police would not be able to cite or arrest anyone for anything at or under the prescribed amount.

Someone in the state legislature would have to take the lead and propose legislation to regulate the new marijuana industry, as lawmakers did with HB 1284. Nancy Spence, who is now retired, was one of the two Senate sponsors of that measure; although she says she wasn't supportive of the boom in the MMJ business, she helped craft the rules because it was the right thing to do. "I tried my best to do a good job at the regulation," she recalls. "Although I didn't support MMJ in the year 2000, the responsible thing to do was take care of it and do my best to make certain that it was regulated in a way that would contain it."

So far, no legislator has stepped forward — at least, not publicly — to do the same work on Amendment 64. It's possible that none will — and even if such legislation is passed, the governor could refuse to sign it. But the language of the ballot proposal takes that into account. If state government stalls on enacting the will of the people, one lawyer notes, the matter would automatically bypass the state and go straight to local jurisdictions, which would then license and regulate the stores. (If they allow them at all; as with MMJ, municipalities can opt out of pot shops.)

Tvert points to the state medical marijuana system as a good example of what this version of legalization regulation could look like. Just as the Colorado Legislature charged the Department of Revenue with regulating the MMJ business, Amendment 64 would have the Department of Revenue do the same for commercial marijuana stores. That means regulating everything from labeling requirements to production standards to advertising and display of marijuana in public. And all of those rules would have to be in place by July 2013, so that the state could begin licensing pot shops that October.

But while Tvert cites the system that the legislature set up with the Department of Revenue as a model that could be followed again, he might hope it works a little more smoothly the second time around. The Medical Marijuana Enforcement Division has struggled in its sixteen months of existence and has had financial problems, squandering a lot of its operating budget on overpriced video-monitoring systems and leases on new black Chevy SUVs. There aren't enough people on staff to drive those vehicles: The division has gone from thirty employees to around a dozen.

Partly because of the staffing shortage, more than a year after the division was established on July 1, 2011, it has yet to license all of the dispensaries around the state. Despite collecting more than $11.8 million in its first fourteen months of existence, as of October 23, the MMED had licensed just 266 medical marijuana centers around Colorado, and still had 277 licenses pending in the system. Those centers that were in business before July 2011 have been allowed to remain open in the interim — which means that some dispensaries have been open for years without paying licensing fees, while others that were issued licenses in September and October of 2011 are already being asked to cough up renewal fees.

If it passes, Amendment 64 has the potential to bring in far more money — and create much more work for the Department of Revenue.

Last month, the Colorado Center on Law and Policy estimated that the state could come out $60 million ahead in the first year after Amendment 64's passage, by cutting police costs and increasing tax revenue.

But how pot businesses would pay those taxes is another hurdle. As the medical marijuana industry discovered over the last few years, banks and credit unions insured by the feds have become wary of doing business with MMJ enterprises. That led state senator Pat Steadman to introduce a bill last year that would have created a state-run credit union for the medical marijuana industry. His idea was shot down in committee, though, and he ultimately conceded that the banking fix for marijuana businesses isn't going to come at the state level, but the federal. "The solution doesn't lie at the State Capitol in Denver," he said at the time. "This is a problem with federal law and federal law enforcement agencies. We have been searching and searching for some kind of work-around. The bill we came up with has the potential, but for various reasons, I'm not sure it's all there."

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William Breathes
Contact: William Breathes