BOULDER'S MEDICAL-POT SHOPS STRUGGLE WITH 'GRUELING'
PAPERWORK

No Owners Have Completed City's 22-Page License Application

When Michael Lyttle opened up the packet to apply for a Boulder
medical marijuana business license last week, he was greeted with a
22-page document that would probe the intimate details of his
personal, financial and business affairs -- and test his patience.

"I feel like I can open up my own bank after doing all this work,"
said Lyttle, a co-owner of the Boulder Medical Marijuana Dispensary at
2111 30th St.

Following legislation passed earlier this year, medical marijuana
businesses must apply for operating licenses through both the state
and the municipalities in which they operate. The deadline to apply
for a state license was Aug. 1.

Boulder released its applications early last week. Most of them are
due by Oct. 29, with a shorter deadline for businesses that were
operating without a city sales-tax license as of June 17.

As of Wednesday, none of the estimated 100 dispensaries and
greenhouses doing business in the city has turned in a completed
application, which some business owners say is lengthy, complicated
and expensive to put together.

"We dabble in it here and there," said Lyttle, who compared the task
of researching and compiling all of the required records to "jumping
through rings of fire."

The questions

A warning printed on the top of the lengthy checklist section of
Boulder's application highlights Lyttle's point.

"It is recommended that you retain an attorney to assist you with this
application process," the document begins.

The application also warns that all answers will be checked, and that
incomplete applications will automatically be rejected. Questions include:

"Does the applicant propose to have retail sales of
medical-marijuana-infused products?"

"If the applicant will grow medical marijuana, describe how applicant
will offset its electrical consumption with renewable energy."

"Does the applicant have a good-neighbor plan for their
location?"

The city also wants detailed information about the people behind the
businesses, requiring background checks on anyone with as little as a
1-percent ownership interest.

Each owner and financial backer must provide a complete set of
fingerprints; a list employers for the last five years; names of
relatives working in the marijuana industry; details about whether
they've been convicted of a crime; and detailed financial records that
include investment and banking records. They can also include
"evidence of rehabilitation" if they have a criminal past.

The applications also require dispensaries and growing operations to
file security plans about how they intend to keep their products safe,
as well as lighting plans for the outside of shops, good-neighbor
plans, product-delivery plans and a general operating plan.

Lyttle, who has owned a car wash and a general contracting firm, said
that "nothing was ever as intense" as applying for a medical marijuana
license.

"I'm just hoping it's worth it in the long run," he
said.

Good stewards

Alisa Lewis, Boulder's city clerk who is in charge of managing medical
marijuana licenses, said the new process was designed to mimic what
someone would go through to apply for a city liquor license.

"We are basically treating it as we would any other controlled
substance, Lewis said.

She said the application process isn't designed to be difficult.
Rather, it's supposed to be a detailed look at who dispensary owners
are and how responsible they would be in running a business that's
still considered illegal by the federal government.

"We don't necessarily have any federal or state backup on it at this
point," Lewis said. "It's a matter of, 'Are you going to be a good
business owner, a good steward for the industry?'"

Still, some dispensary owners say the applications are
overkill.

"It's a pretty long, grueling, expensive process to say the least,"
said Brad Melshenker, owner of The Greenest Green, 2034 Pearl St.

Melshenker said paying for studies and upgrades to meet the city's
security, lighting and other operating requirements can easily top
$100,000.

The filing fee to have the city review an application is $3,000. If
the license is approved, it's an additional $2,000.

Asked whether he thinks the time and money spent keeping his business
legitimate will pay off, Melshenker was circumspect.

"That's what I stay up every night thinking about," he said. "I pushed
all my chips in."

Boulder medical marijuana business license application:

http://extras.mnginteractive.com/live/media/site21/2010/0811/20100811_112824_Medical_marijuana_business_application.pdf