COLORADO CITIES DIVIDED ON LICENSING MEDICAL POT

Some Collect Taxes, Some On Hold, Some Say 'No.'

For Colorado cities, dealing with the issue of medical marijuana in
2009 is a lot like being offered that first joint back in the 1960s -
do you join the party or just pass it on?

Pueblo City Council is stuck in that predicament at the moment, hoping
that if it imposes a seven-month moratorium on licensing any medical
marijuana businesses until July 1, the Legislature will get busy this
spring and adopt statewide regulations on how to do just that.

It's a dilemma that cities are handling in different
ways.

According to the Colorado Municipal League's latest survey of 95
cities and towns, among those that have taken action:

Twenty-five already are collecting sales tax from the medical
marijuana dispensaries that are operating in their communities, a fact
that dispensary owners tout when urging municipalities to license
them. Boulder and Colorado Springs are in this group.

Twenty-six have imposed a moratorium, similar to Pueblo and Pueblo
County, in an effort to draft zoning and licensing regulations, or to
simply decide whether to allow the dispensaries at all.

Brighton, Craig, Fountain and Montrose are among the cities doing the
same.

Fifteen cities and towns have just said "no" - refusing to license or
allow the dispensaries, noting that even though Colorado voters
approved the use of medical marijuana nine years ago, its use or
distribution remains a federal crime.

Greeley and Aurora are among them.

Medical marijuana users and the people who supply them, referred to in
the amendment as caregivers, are impatient that so many communities
have issued moratoriums on a process they believe voters legalized in
2000.

Tom Sexton, a Pueblo man who is trying to open his MediMar Industries
dispensary as a storefront operation, protested to Pueblo City Council
earlier this week that he is trying to bring his business out of the
drug-dealer environment of making sales in houses, restaurants and
meetings on country roads - only to collide with moratoriums.

Council President Vera Ortegon tried to reassure Sexton and other
supporters

of medical marijuana that the issue isn't legalization.

"The voters already have decided that. It's a question of how to
regulate it," Ortegon said.

The reason medical marijuana has erupted as an issue for local
governments this year is U.S. Attorney General Eric Holder's
announcement that the Justice Department would not target medical
marijuana growers in states that allowed it. Along with Colorado,
those states are Alaska, California, Hawaii, Maine, Maryland,
Michigan, Montana, Nevada, New Mexico, Oregon, Rhode Island, Vermont
and Washington.

In an October memorandum to U.S. attorneys in those states, Deputy
Attorney General David Ogden noted that marijuana sales continue to be
the largest source of revenue for the Mexican drug cartels that work
both sides of the U.S.-Mexico border and that disrupting that network
of growers and distributors remains a "core priority" for federal law
enforcement.

Still, in those states with medical marijuana laws, Ogden wrote, "As a
general matter, pursuit of these priorities should not focus federal
resources in your states on individuals whose actions are in clear and
unambiguous compliance with existing state laws providing for the use
of medical marijuana."

Does that mean anyone claiming to be a medical marijuana grower is
free from federal prosecution? Not according to Ogden. Urging
prosecutors to evaluate each case individually, Ogden advised
investigators to look for signs of illegal activity in association
with a dispensary, such as the possession or unlawful use of weapons,
violence, reports of sales to minors, indications the business is
being used to launder money from other businesses or the presence of
other illegal drugs.

Pueblo Police Chief Jim Billings summed up the law enforcement
quandary for council this week by saying his officers need to
investigate reports that marijuana is being grown in the city.

While Amendment 20 allows medical marijuana users, or their caregiver,
to have up to six plants, the city code does not permit it.

State lawmakers are working on the issue.

Pueblo legislators confirmed this week that legislation is being
drafted in cooperation with Colorado Attorney General John Suthers,
law enforcement and even growers, to establish a general template for
how to regulate dispensaries. That legislation could be very detailed,
prohibiting dispensaries from operating near schools and even
establishing state and local licensing fees. But other details could
be left up to local governments, meaning council may still have to
oversee the drafting of zoning and licensing regulations.