The Crested Butte News Serving the Gunnison Valley since 1999
No limit to number of permits allowed
by Mark Reaman
While those hoping to open a marijuana-associated business in the city of Gunnison can pick up an application starting this Monday, July 6, it is expected that it will be early September before dispensaries are open and selling recreational or medical marijuana. Dispensaries operating in Crested Butte expect to see some impact on their business, and at least one plans to open a Gunnison branch.
The Gunnison City Council voted unanimously last week to approve an ordinance on its second reading, officially allowing for the sale, growing and manufacturing of marijuana and marijuana-infused products within the city limits.
“We get a good number of people from the Gunnison area coming up to the store,” said Chuck Reynolds, a co-owner of Soma in Crested Butte. “So we plan to open a satellite in Gunnison. Given the process involved, we think it will be early September before we get open.”
Reynolds said the idea is to open a dispensary along Highway 50. “We certainly would lose some customers who come up here so we want to maintain that base, plus we think we can capture some drive-by traffic. It was really a no-brainer. We have to open something down there.”
Reynolds said the new store would be modeled after the Crested Butte dispensary. The News reached out to other dispensaries in Crested Butte but emails and calls were not returned.
Gunnison mayor Richard Hagan said in the long public process used to approve marijuana in the city, the impact on Crested Butte was not really discussed. “We didn’t talk about how this would affect Crested Butte. I assume it will have some impact, but the real impact would be if neighboring states legalize marijuana,” he said. “That won’t come for a while but it sure seems that having legal marijuana has been part of the experience for some tourists. There appears to be marijuana tourism going on in the state.”
One big difference in the marijuana rules between Crested Butte and Gunnison is that Gunnison did not cap the number of permits it would allow. Crested Butte has a limit of five retail licenses.
“We decided that the market would dictate how many make it,” he explained. “We figured that if we limited the number of permits to, say, two and we had five applicants we would have to hold a lottery. There would be a chance that the best businesses wouldn’t get chosen. So we decided to keep with the free market and let the businesses survive.”
Hagan said the city deliberately took its time in approving legal weed. “The staff did a great job doing research around the state and determining what worked and what didn’t. We wanted to move slowly. Through the process of going through the ordinance we had a lot of public meetings and we listened to the public. We changed some things as a result,” he said.
As an example, the city originally proposed allowing dispensaries only in the city’s industrial zone, over by the airport. “But we heard that access was problem,” Hagan said. “So we ran a number of scenarios using the state buffers. One issue was the buffer with local churches. We came up with a compromise that limited the allowed business hours on Sundays so that conflict would be resolved. That helped solve some of the contentiousness.
“One of my original concerns was that allowing legal marijuana establishments would change the reputation or tenor of our community,” Hagan continued. “But asking around to other places that have done it, they didn’t feel that was the case. One comment that struck me when we were talking about locations was that ‘Any 14-year-old with a cell phone could find a dispensary no matter where you put them.’ That plus the fact that keeping young people away would more likely be accomplished if the dispensaries were in a higher profile setting as opposed to tucked away in an industrial zone made me sort of change my mind in some respects.”
So while the council is not allowing them to be located in the main core of the city, there will be places along Highway 50 and along Main Street toward the north side of town near City Market that would be eligible to house a marijuana business.
City manager Ken Coleman said 1,000-foot buffers are provided around educational facilities. Pot leaves are not allowed on the business signs.
As for the grow side of the business, Reynolds said Soma is set up with an operation in Riverland. That operation is expected to be approved for the manufacturing of “marijuana infused products” (MIPS) as well. “We won’t be looking to grow in Gunnison,” he said. “We are good in Riverland and are in the process of getting a large-scale grow in Pueblo off the ground. So the Gunnison growing rules don’t really impact us.”
Hagan and Coleman say Gunnison will have an additional tax on marijuana sales. “There is an additional 5 percent sales tax (on top of the state tax and the city’s current 4 percent) on all retail sales,” explained Coleman. “There is a 5 percent excise tax on wholesale sales from cultivation facilities and infused products if sold outside of the municipal boundary.”
Hagan said money collected from that tax would go toward additional administration and law enforcement costs that are expected to result from the ordinance. There will also be some money set aside for education and programs to keep kids off illegal drugs.
“In the big picture, the citizens overwhelmingly voted to approve this direction. It was a landslide,” Hagan stated. “It expands our tax base. I think we are well positioned to deal with this enterprise. We have already been notified by several people in all facets of the business looking to come into the city. One thing we did talk about is that we stand ready to change our ordinance if we think something is not working. We want to be nimble.”
Coleman agrees with that view. “We are very comfortable that we have regulations that were well considered and reflective of our community,” he added. “The will of the people has provided guidance. Also, these regulations are our best attempt to provide clear guidance on requirements for this industry. Regulations are made to be reviewed and revised if deemed appropriate.”
“Overall, we are excited to see Gunnison open up like this,” said Reynolds. We look at it as an opportunity.”
Speaking of opportunity, Reynolds said summer in Crested Butte has already been extremely busy. “Our June surpassed last year’s July numbers,” he said. “There are lots of visitors and locals coming in. We are cranking up here and July is ahead of us.”
That could be the scene next summer in Gunnison. “People in Gunnison are comfortable with the idea,” Hagan concluded. “It will certainly be interesting.”
