Marijuana in Colorado: Ready for Business, Complete with Regulations

The medical marijuana trade has set up the protocols for the newly-approved recreational version

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Rick Wilking / Reuters

Growth technician Mike Lottman moves through the marijuana plants in a medical marijuana center in Denver, April 2, 2012.

Colorado boasts the only for-profit medical marijuana market in the country; and a look at the offerings at Local Product of Colorado, a pot dispensary with 200 regular users, evidences a talent for marketing. Among the fast-selling strains are Golden Goat and Sour Tsunami, a genetically engineered plant that has shown anti-inflammatory properties, according to Jason Katz, head of operations at the outlet. The store also carries a host of popular marijuana-infused edibles, oils and even drinks.

Business has never been easy. If mainstream small businessmen gripe about government regulations then they shouldn’t consider going into the legal marijuana trade. Every step in the growing process—“from seed to sale,” says Katz—is rigorously monitored by the state. The planting, growing, and processing of plants happens under the constant view of video cameras monitored by the state’s Medical Marijuana Enforcement Division. No video blind spots are allowed. Truck shipments must also detail the total weight of marijuana products, in addition to the vehicle’s time of departure and arrival. And every marijuana worker must be licensed, an arduous, time-consuming process.

(MORE: From Mexico to Moscow, The World Turns on to Marijuana Legalization)

That heavily regulated system, however, may have helped win passage for Colorado’s Amendment 64, the recreational marijuana measure approved by voters on Election Day. It legalizes the use and possession of marijuana for people over 21 and allows them to cultivate up to six plants. Experts say that Colorado’s medical marijuana regulation provides a successful model for monitoring recreational marijuana. “The thing that Colorado really has going for it is that there is already a high level of comfort and familiarity with the state licensing, taxing and regulating the above-ground distribution of marijuana,” Ethan Nadelmann, executive director of the Drug Policy Alliance, tells TIME. “People had become accustomed to the notion that this can be a source of tax revenue, and that police can play a role in insuring effective regulation rather than just arresting anyone they could.”

A long-standing argument in favor of marijuana legalization in Colorado is the drug’s sheer revenue-generating potential. Until now, drug cartels have enjoyed the lion’s share of marijuana profits. But Amendment 64 is almost certain to take a sizeable economic bite out of the black market. The law could generate up to $60 million annually for the state in combined tax revenues and savings from reduced law enforcement costs, according to the Colorado Center on Law and Policy. The amendment also calls for a 15% excise tax on wholesale marijuana sales, with the first $40 million in revenues every year earmarked for the construction of public schools. “That was certainly part of the selling point,” Sam Kamin, a law professor at the University of Denver, tells TIME. “Medical marijuana and legalization have definitely been buoyed by the fact that they are a potential tax revenue source at a time when so many of those have been drying up.”

But the strict oversight of medical marijuana has done more than set up Amendment 64 for regulatory success. Colorado’s strident rules have, for the most part, also kept the federal government at bay. The state’s Attorney General has mostly kept his hands off hundreds of dispensaries operating in the state, only targeting some that were operating within 1,000 feet of schools. “They have a policy essentially in Colorado that if you’re following state law, they will leave you alone,” says Brian Vicente, executive director of the non-profit Sensible Colorado, referring to the federal government.

While opinions vary, drug policy experts say that bodes well for the future of recreational marijuana in Colorado. They point to some promising signs. When California attempted to legalize recreational marijuana two years ago, for example, U.S. Attorney General Eric Holder warned the state of the consequences. In Colorado’s case, though, Holder has remained silent, despite repeated calls from former DEA administrators for Holder to take a strong public stance against Amendment 64. Says Nadelmann, “There’s a possibility that the Obama administration will consider refraining from intervening to the extent they are persuaded that the state has come up with a responsible regulatory model that addresses their concerns.”

-With reporting by Erin Skarda in Denver, Colo.
MORE: Two U.S. States Become First to Legalize Marijuana

201 comments
liquid_drummer
liquid_drummer

There is no way to stop drug usage. There has been a demand for drugs since man figured out he/she could alter the mind. We have to regulate because the demand will never go away and we cant just jail everyone that uses. We can not afford that. It is a catch 22 really. We have to try something new. What we have been doing is causing more harm than the drug.

KateNeale7
KateNeale7

Regulating drugs does have it's benefits that way you can see the true scale of the issues affecting people and their dependence on it

hermes1939
hermes1939

Now Marijuana...next cocaine...what is next? Because of  'the long standing argument of ... is the revenue-generating potential'. There are limitless potentials for huge revenues, try to legalize prostitution (many countries are now working on this). This is the irony of man's greed - never mind of the evils it brings for as long as there is money, lots of it. Several attempts by health buffs to totally ban tobacco but then again due meanly to its negative impact to the economy, it will be there for good.  Where is civilization heading?  Make your guess! It is as easy as one-plus-one.

ron.nwtn
ron.nwtn

The weed smokers get it wheather it's legal or not, so let's get some revanue from it.

MarcDaneker
MarcDaneker

Drug Trade, if you can't fight it, regulated and control it.

Nothing_To_Say
Nothing_To_Say

I don't think that the state will save a single dollar from reduced law enforcement costs. On the contrary drug legazizaltion or decriminalization will open the doors for the drug tourism industry and will rise the number of interstate prosecutions for drug smuggling and other drug related charges...

The state will also need to invest more in prevention and rehabilitation programs (and facilities) as well as to reduce disturbance of public order caused by drug users..

Contrary to what most people believe. In the Netherlands, both possession and production of marijuana for personal use are illegal. Technically, coffee shops are illegal too...however, a policy of non-enforcement has led to a situation where reliance on onon-enforcement has become the norm...

I wonder if any of you guys have been to Amsterdam...even thoug it is a very nice city...it is disgusting to be there...everywhere you go smells like pot, and you only see potheads from all over Europe wandering through streets and alleys like zombies....it got so out of control that the Dutch government passed laws banning coffee shops from selling weed to foreigners....

I don't think that any of you want the same going on in your hometown as in Amsterdam...

ronmckin
ronmckin

One point in the Colorado law is that industrial hemp for fiber, oils etc will be encouraged.  Anyone who has looked at the value of hemp for those uses knows how valuable it will be for cloth, paper etc.  But our clueless Feds still fight it tooth and nail because someone might get red eyes and eat too many Cheetos.

GreenTvLake
GreenTvLake

Why won't anyone report on this. The U.S. has the Patent # 6630507 on medical marijuana and a disabled venteran has a similar Patent#7597910. The two Patent holders can work together to do this right for the U.S. and people like myself who survived Cancer.The silence from fellow jouranlists is deafening.

liquid_drummer
liquid_drummer

For people that think this will be overturned. The government will have to flat out disregard the 10th amendment of the constitution to do a thing. They will not have the man power to begin to stop it now that the cat is out of the bag in not one but two states. Alcohol prohibition ended the same way. The government loves to threaten they will cut funding. The states are realizing they can bring in 3x as much in tax revenue from legal pot so they are ignoring the feds. A total repeat of the death of alcohol prohibition. It will be behind counters where people can be carded. Yes, kids will still get it. They already have it. However, it isnt going to be very profitable to be a drug dealer for pot anymore so it will become harder for kids over time. #1 place for kids to get pot ? Their local high school. Just ask them. Then, ask them which is easier to get. Pot of booze ? The answer is almost always pot. This election has shown us how out of touch American government is with what the people want. More diversity and the government out of their personal lives.

Crankster37
Crankster37

Hopefully, at the very least, maybe the federal goverment will finally recognized medical marijuana for all of the United States.  I agree with legalization overall to reduce the money flowing to the drug cartels and reduce violence, tax it to fund education, reduce deficits and fund other much needed services.  But as I said, the federal government needs to recognize the medical benefits of marijuana and allow the people who are suffering to benefit.  We have a hugh prescription drug problem because they are handed out like candy, wind up in the wrong hands and are killing the patients.  They are handing patients heroin in a pill when a more beneficial and WAAAY less destructive alternative is widly available.  Please make medical marijuana available to all of the United States .... have compassion for those that are suffering needlessly.

demethos
demethos

I think it's time for a Colorado vacation.  I've been in the mood for kayaking.  Yeah, some high potency medical-grade kayaking.

SteveP
SteveP

Do Dope for the Kids! Quite a marketing campaign.

jonathanfrid
jonathanfrid

And of course none of those home grown plants will ever find their way into the hands of younger brothers, sisters, neighbors, or anyone else under 21... That is what is ridiculous about this law… So what if the businesses are “regulated” heavily, if everyone is simply able to grow it at home, the regulations are meaningless as to the spread and use of this drug…

The whole point of this law at this time was to bring out a demographic that otherwise would not have voted and who for the most part would lean Democrat and therefore push a swing state to Obama (I doubt many people voting split their ticket between voting yes on pot while at the same time voting for Romney)...  

IndigoWolf
IndigoWolf

I'm all for legalization marijuana, even though I haven't smoked it in many years. But, enough about that. I strongly feel that now it's time to legalize hemp, which should have been done long ago.

Traxus
Traxus

How much money has already been spent putting evil pot heads in jail? Legalize pot, remove it from the "narcotics" list. There are far more dangerous drugs out there that the DEA should focus on. There is a meth epidemic coming and it will be ugly. Unfortunately for Colorado and Washington state, pot is still illegal in the federal government's eyes. Is the government going to come in and arrest all of the growers on federal statutes? Probably. Still, my hats off to Colorado and Washington for seeing weed for what it is. Unfortunately I live in Pittsburgh, which is in a commonwealth state, so the chances of me seeing legal weed in my own city is slim.Who knows though. We have a young mayor that might be smoking a bone himself.

Nothing_To_Say
Nothing_To_Say

I was born and grew up in Colombia during the Pablo Escobar era, when drug businesses were booming and drug cartels ruled....I saw first hand how much damage both drugs and drug traffickers caused to the country, but above all else - how much damage both caused to the mentality of the society as a whole...

You see, there is something most people do not consider when discussing drug policies....that is the financial gains...

The huge profits generated from drug trade - regardles of whether they go to the state via taxation or to drug traders' pockets - create a culture of : let's make big money fast....and that's the worst thing that happened to Colombia.

To compare marijuane to cocaine is just as naive as comparing darts with machine guns... Besides I don't know where the idea that drug cartels deal with marijuana came from....

Drug cartels dealt with marijuana during the 60's until the middle of the 70's when they started to import cocaine and methamphetamines into the United States...

If passing laws legalizing drugs is based on the idea that somehow it will hurt drug cartels' finances or somehow will end the drug on wars.....I say it will not...

rossbnelson
rossbnelson

man there's a lot of bickering about this. i say let the nation keep an eye on what happens here, then form your opinions on whether or not this is a victory or failure.

KuntaKente
KuntaKente

Its the right thing to do. You are not telling youth its ok to do drugs, you are controlling the system that cartels have control over. People will use weed regardless if its legal or not. Might as well make it legal and tax the shit out of it and keep it out of the cartel's control. What if alcohol were illegal? Beer, Wine, Liquor, what would we do? Bootleg? Yes...Like we've already done...Even though alcohol can kill, it's regulated...They sell Nyquil over the counter at Walgreens...Does taht mean people are going to go drink an entire bottle? Some people may...but its the same concept with any drug ...We should have the choice, its America folks, the land of the free...

sennipop
sennipop

You people are high if you think the marijuana law that passed in either CO or WA will ever become active. First off, it will be a year or more before the regulations are made and the law would take affect, and many things can and will happen before that. Feds will not allow this as is. I believe the law will eventually create federal de-criminalization law and nothing more. The feds or state cannot allow citizens to grow as this will just lead to trafficking across state lines. One would think this fact and the fact that legal marijuana would create revenue would be enough for all states to just accept legalization and go with it, but instead it will create backlash from other states and the feds and this forward movement marijuana took after all these years will be pushed back another 50 years. Medical should of been the goal first, and it was with many states, but now it's like the pro side wants everything or nothing and this just isn't going to happen. I predict once Jan 2013 rolls around the feds will give the states who have passed these laws a certain time frame to adjust the rules to their liking, and if the states do not comply the feds will take action. The majority in most states would never vote yes to legalization, in some states medical will never be passed, and on a federal level it will never be legal. Don't ruin a good thing, which is de-criminalization and more progress for medical, by pushing full legal. It's not going to happen on a national level. Users, growers and patients of marijuana are a minority. Last time I heard this was a democracy where the majority ruled. I'm all for not charging people for possession and use of under an oz. but for those that will use these laws for pure profits and greed I hope and am certain these laws will be repealed or revised long before they go into affect. Only in America would we tell our youth it's ok to do drugs.

liquid_drummer
liquid_drummer

@ron.nwtn Yep. Simple logic. The private prison industry is not to happy though and lobby hard for tougher pot laws and more time because the make money from people being in jail . The more the better for them. This should NOT be allowed in this country. It is the most gross conflict of interest against the people in the history of this country and it is being largely ignored. It's actions are deplorable. Do an ounce of research on the private prison industry and you WILL want to get on soapbox about it. Trust me.

liquid_drummer
liquid_drummer

Have you been doing any research on this subject ? It has been proven in a number of reports world wide that law enforcement incurs a pretty sizable saving anywhere that pot is legalized or when their is a change in how it is tolerated by the government. Read this for starters. This is a based on what happened after 10 years of all drugs being legal in Portugal. Spain has eased up as well and is seeing the exact same results. States will not only save money they will make tons of money. People are flocking there for the pot gold rush. Growers from overseas have been moving to Colorado since medical passed. This industry, if controlled like the alcohol beverage industry which is the goal eliminate a lot of drug dealers because most pot dealers dont like dealing harder stuff because it equals harder time. I know this from 20 years of past usage. I use not for a cervical spike disorder. It has kept me from becoming addicted to pain pills thank god ! Trust me, with my neck pain I would be addicted to narcotics no doubt at all.

http://www.foxnews.com/world/2010/12/26/portugals-drug-policy-pays-eyes-lessons/

Statewide (Washington State)there were about 9,308 marijuana misdemeanor cases filed in2010 and about 670 marijuana felony cases. ACLU estimates that from2000 to 2010, the statewide marijuana enforcement costs totaled $211million. That estimate does not include the costs in lost income andopportunities borne by those who were arrested or their families.The bottom line: Legalizing marijuana offers government a pot of money, both in revenue and in savings.

sennipop
sennipop

@ronmckin The federal gov could absolutely just legalize hemp, not marijuana, and it would help the economy much more then legalizing marijuana. Hemp could provide and replace so many things I'm amazed it hasn't been legalized yet, but on the hemp issue and possibly the marijuana issue the powers that be have and will have their way until they no longer have power.

sennipop
sennipop

@liquid_drummer 10th amendment does not apply, nor has it for other issues. The fed gov and supreme court has changed how much power the 10th has for states. They have plenty of manpower. And it still isn't law in any state yet, regulations still need to be written in CO and WA and the feds have plenty of time to react. Alcohol prohibition was nothing like this, that lasted only 14 years, really only about 12 were enforced, and it was legal before that. Marijuana has never been legal. So your idea of a successful legal win for marijuana is inflated prices by over-taxing that will not be as big of a money maker for the state as most think? Illegal local dealers will not be affected, the prices will not drop, they will rise. then steady out near current street prices. If you understood economics you might have a clue. You cannot overtax and regulate something and make it cheaper. I'm pro-marijuana, but most of you foks are just clueless on the realities of this issue.

sennipop
sennipop

@jonathanfrid Locally this may be true but Obama on a national level has been very consistant on being anti-marijuana. His stance is basically leave users alone, punish gorwers and dealers. He would leave medical alone this term but his admin has been ruthless against both illegal and legal medical the last 4 years. He conducted more federal raids and arrests in 4 years then Bush did in 8. I'm fairly certain marijuana will be de-criminalized and not legalizaed in most or all states and on a fed level. Which will allow users and small possession to not be a crime which is where we should be. I highloy doubt growing or dealing will ever be legal anywhere.

SeanMKazmierczak
SeanMKazmierczak

@jonathanfrid Yes because people can't produce their own alcohol at home either...which can get into the hands of younger brothers, sisters, neighbors, or anyone else under 21....

Let's just forbid anyone from consuming anything...that'll solve this issue once and for all.

S
S

@johnmcmurray11 In Washington, which, by the way, almost always votes Democrat, so I don't see it as being a political ploy here.  Legalizing Marijuana just makes sense.  It reduces the money spent on "the war on drugs", a program that has a fantastic fail rate and costs billions.  Plus it adds tax money to the states coffers.  And anyone that thinks people are going to be giving kids pot only needs to look at the number of people supplying kids with alcohol, which is legal, and far more harmful.  Let's give adults the benefit of the doubt here and assume most of them will act responsibly.

JeffKrogue
JeffKrogue

@IndigoWolf 

It should be decriminalized at least.  I think the war on marijuana has probably done more harm than good.

sennipop
sennipop

@Traxus Sorry. The great state of Pennsylvania would be one of the last to ever legalize. Expect de-criminalization in 5-10 years.

BobWilliamKnight
BobWilliamKnight

@Traxus  it's coming there too gotta be patient  cheap good pot will replace meth to some degree alcohol too 

JeffKrogue
JeffKrogue

@Traxus 

If it happens like California, the Feds will come in and shut down dispenseries and I'm sure any large growers.  The feds obviously don't have the resources to go arresting every pot head around.  It should at least free up the Colorado Criminal Justice system, if the Feds want to waist their time I guess that's their business.

BobWilliamKnight
BobWilliamKnight

@Nothing_To_Say wrong cartels growing in US big time .those tunnels to states from Mexico with 20 ton loads of pot were not funded by regular dealers .who's to say how big their pot business is but its a lot of money

JeffKrogue
JeffKrogue

@KuntaKente 

Most people agree that alcohol is far more of a problem than marijuana.  Nobody smokes weed and then beats their wife or starts bar fights.

snoig0
snoig0

@sennipop Parts of the Colorado legalization law will go into effect as soon as the election results are certified which should happen sometime next week. Individuals will be allowed to grow up to six plants per person before the end of the year. It will be a while before we see legalized sales but I don't think that is as far off as you think. All the infrastructure is already in place and in some places there are dispensaries on every corner. The state really doesn't need to do much to allow those places to sell to anybody. The licensing, taxing and enforcement parts of the puzzle are already in place and have been for some time. Just remember, marijuana has essentially been legal in Colorado for about five years now.

BobWilliamKnight
BobWilliamKnight

@sennipop  wrong!!!so very very wrong.it starts i 1 month in Colorado.the feds are powerless. any backlash is just lol too bad .you lost and the feds lost soon it will spread to the corners of the earth . democracy means we voted you lost. you do no speak for anyone but yourself pal . soon we'll all be rich and stoned and happy but you will be miserable and alone 

ronmckin
ronmckin

@sennipop Medical is doing just fine here in Colorado.  Why do you think fully legalized will not?  And even it not, they still cannot stop pot smoking or growing.  You really don't know what you are talking about.  You might study up on states rights and the tyranny of the majority before making your unlikely predictions.

Nothing_To_Say
Nothing_To_Say

@liquid_drummer  

I think I'm well aware of the obvious health benefits that medical marijuana brings for i.e. sufferers of harsh pain and other medical conditions...basically I'm not arguing against the legalization of medical marijuana...

Legalization of marijuana for recreasional pourposes is a different story. Comparing Portugal and Spain with the U.S. doesn't work because over there you have completely different society, different social structures and social dynamics...

What Portugal did was the result of trying to solve a problem that was already out of control. They had so many drug addicts - in such a small country - that the only way out was to keep pushing forward...

The use of narcotics has a direct impact on the labor market, either in the aggregate or in the motivations of individual users. It also lead to a decline in economic efficiency and productivity....no wonder that the economies of Portugal and Spain are in a non-ending crisis..

Outside_the_box
Outside_the_box

@sennipop The Rand Institute's study showed that pot's price would go down by a factor of 10. You can judge whether they "are clueless", but I'm going with them over some random CNN poster.

Gemstoned33
Gemstoned33

@sennipop If it was NEVER legal, then what was that mystery potion in every M.D.'s bag in the late 1800's ???

sennipop
sennipop

@BobWilliamKnight @jonathanfrid Bob. If you can't make an intelligent comment on this issue just quit replying. Whether you are for or against is fine, it's America, but at least have some substance in your comments.

sennipop
sennipop

@BobWilliamKnight @sennipop Proof you have no idea what you are saying. The law that the voters passed couldn't even become an active law until 2013 anyway, so your claim that legalization is a month away is incorrect as in a month we will still be in 2012. The state itself has already stated it will take months before regulations are written up and the law would become active. Are you even keeping track of this issue? I'm pro-legalization but I'm being the pessimist, the realist, and it's sad to see the pro-folks guard go down just because a small majority in CO and WA passed a law that can be appealed at any time. "you lost" Huh? It's this mentality that screws up everything.

sennipop
sennipop

@ronmckin @sennipop CO may be the only place where medical is doing OK. Ah, a good indication it will never be fully legal is it never has been fully legal ever in this society. The feds and most states are not just going to do a 180 after all these years promoting anti-drug use just because two states small majority of citizens legalize it at the polls. It's a small battle won, but the it's a war. It's like the US taking Normandy beach in WW2 and declaring victory before they even get a few miles inland. This is not over, and pro-marijuana folks need to realize this will be ongoing for years and it's not going to be easy. The law passed is not law yet. The state has to make regualtions and get it in the books yet, the feds have a lot of time to sit and watch just like a hunter stalking it's prey. No, I don't know what I'm talking about, I've only been involved in domestic and international politics and law for most of my life.

SymphonicDlight
SymphonicDlight

@sennipop @ruffalonm19 Hey Aslinger, you are right in that the process will take time, but prohibition is starting to end.  What will the feds do, when medical is legal in 20, 30, 40 states?  How about when recreational is legal in 5, 10, 15 states?  Whack-a-mole busts will be an even bigger waste of financial resources, than the already failed war on drugs, leaving the federal government accepting the fact, that mj is fairly innocuous compared to literally hundreds of legal substances and products you come into contact with everyday.  A plant that occurs in nature, being anything less than completely legal and legitimate is ridiculous if you really take the time to think about it.  It is legal to grow poppy in this country, as long as you leave the bulb untouched. Get this country off of oxycontin, crystal, and heroin already.

sennipop
sennipop

@ruffalonm19 @sennipop Big difference between hemp and marijuana, and what you interpret the founding fathers mean by those quotes I already know by heart. I've been in a political science and history career for 20+ years. Please don't quote historical political figures quotes and tell me to do my homework, son. And learn the difference between hemp and marijuana. It has something to do with this thing called thc, the height, the appearence, and one can be manufactured into over 25,000 different products. The other just gets you high and has questionable medical benefits. Get an education before you attempt to school others.

ruffalonm19
ruffalonm19

@sennipop "Hemp is of first necessity to the wealth & protection of the country."- Thomas Jefferson"We shall, by and by, want a world of hemp more for our own consumption."- John Adams"Make the most you can of the Indian Hemp seed and sow it everywhere."- George WashingtonI think you're a little misinformed when it comes to cannabis sennipop. You should do your homework to avoid spewing such garbage.

ronmckin
ronmckin

@sennipop Sorry about the ad hominem.  I usually don't do that.  I do though think the steady victories in the states are very telling and indicative of a strong trend the Feds really can't fight.  They simply do not have the resources to fight it.  And, as we all know, there are much much bigger problems to tackle.  Only time will tell...but I am very positive.  Now as to legalizing the "powders" like cocaine etc., treatment is still better than jail.  But funny how those treatment programs are co-opted by ex-government types and turned into more retirement cash for them.

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