MEDICAL MARIJUANA: COLORADO LAW

Medical Marijuana Colorado law plows way for new dispensaries in
Montezuma County

With six dispensaries in Cortez alone, the number of medical marijuana
centers in Montezuma County is growing like a weed.

Since the first medical marijuana center, Herbal Alternative, was
established in October 2009, five more dispensaries popped up in
Cortez, filling the city's coffers with $14,600 in sales tax revenue
through July 2010.

Statewide, the Department of Revenue took in $8.3 million in
application fees. Fees from the 809 centers and 309 infused products
manufactures.

Colorado voters approved medical marijuana in 2000 through the passage
of Amendment 20, which gave Coloradans with certain medical conditions
the constitutional right to medical marijuana. The amendment left
medical marijuana dispensaries in a legal gray area because they
weren't mentioned.

This May, the Colorado Legislature passed HB 1284, which pulls
dispensaries out of that gray area by granting them state licenses.
Dispensaries can sell medical marijuana in a smokable form as well as
edible goods and topical products infused with the properties of
marijuana that create the desired, pain-reducing effects.

In addition to the six Cortez dispensaries serving Cortez's 8,600
residents and residents in the surrounding areas for pain relief,
there are four public pharmacies - Walmart, Walgreens, Safeway and
City Market - one inpatient pharmacy in Southwest Memorial Hospital
and the Towaoc Indian Health Service for enrolled Ute Mountain Ute
tribal members.

Montezuma County's approximately 25,000 residents also have the option
to choose from two more dispensaries in Dolores - bringing the total
number of medical marijuana dispensaries in the county to eight.

So far, the demand for medical marijuana has been enough to sustain
the centers.

Kirsten Krzysztofiak, owner of Herbal Alternative, said her store has
300 medical marijuana card carrying patients. Nature's Own Wellness
Center Owner Travis Pollock estimated he serves from 300 to 400 with
more than 1,500 patients that visit the center.

Southwest Colorado Caregivers, Medicine Man and True Earth Medicine
opened in quick succession beginning in April before a state-imposed
moratorium on dispensaries prevented new centers from opening June,
30, 2010, through July, 2011.

Through House Bill 1284, the state will continue to outline
regulations in greater detail, including restrictions on who can
operate them, allowing local governments to ban dispensaries and
ordering owners to grow 70 percent of the marijuana themselves.

City of Cortez Planning Director Kirsten Sackett said the city took a
land-use approach to contain the centers within commercial districts
as well as keeping them 500 feet away from schools, parks and each
other until the state regulations are made.

"We want to be transparent. That's part of the reason (the
dispensaries) are located where they are, so they're visible to the
public," Sackett said, noting the city council decided against banning
the centers.

Derique Duran, the manager of Beacon Wellness Group, a Cortez medical
marijuana center that opened in June, spent a month making the center
handicap accessible for patients and worked with local authorities on
the best location.

Sackett said in Cortez, local law enforcement officers regularly work
with dispensary owners, who are required by local regulations to have
a fully functional security system in place.

"We already have our chief of police visit them to make sure they know
there is a presence and they are abiding by local regulations," she
said. "It's also a bit of a comfort level for (the dispensary owners).
They have their own concerns, too, with security."

The only dispensary break-in to date occurred in the early hours of
Friday, July 23, at True Earth Medicine, 302 N. Broadway, in Cortez.
The dispensary door's double-pane window was broken from the outside,
according to a Cortez Police Department report, and a broken, empty
mason jar (typically used for storing medical marijuana) labeled
"God's Gift" was recovered nearby.

No crimes have been reported at Dolores dispensaries.

"Frankly, we haven't had any issues with our centers to date, which is
positive," said Dolores Town Manager Ryan Mahoney.

After allowing Bucket-head Herbal Healing Center and Rocky Mountain
Medical Marijuana
Dispensary to open in Dolores, the town passed a moratorium on medical
marijuana centers until state regulations are handed down. The
regulations are due July 2011.

"Basically our approach is to wait and see how the state regulations
will affect municipalities and their ability to control locally the
dispensaries," Mahoney said. "Part of what we wanted to do was not
have a big rush before the state moratorium went through (in June)
just because there was so much gray area."

The town of Dolores might extend its moratorium to coincide with the
state's July 2011 moratorium, Mahoney said.

"We didn't spend a bunch of staff time or town money coming up with
town ordinances that some municipalities will have to go back and
readjust," he said. "And because we haven't had any bad experiences,
we figured we will let the pieces fall where they may."

Businesses in Dolores must contribute to the town's sales tax, but
Mahoney did not have any figures to release.

The town board of Mancos passed an ordinance in March that states
there is an application fee of $3,000 for a business permit. The
ordinance requires a criminal background check, paid for by the
potential owner, and requires an annual business permit fee of $2,000
per year. Cortez and Dolores don't charge a separate fee for
dispensaries.

Tom Yennerell, town administrator for Mancos, said the board is
allowing dispensaries, but the state's moratorium is currently
preventing centers from applying.

"They decided to not put it out to the voters and to allow centers to
locate here, provided that they conform to the ordinance we set up
prior to the state's adoption of regulations that became effective
July 1," Yennerell said. "Now our's may change based upon the new
legislation once rules get written, but at this point, the town is
allowing them."

Local Mancos rules require that dispensaries be located at least 500
feet from a school or park, or 200 feet from a church, correctional
facility or halfway house.

Duran said he isn't worried about the number of dispensaries.

"We just saw a void for professionalism in the area, which, in any
business, if you can do someone else's job better than they can, you
will survive," he said.