A limited number of medical marijuana dispensaries in Colorado Springs would be able to obtain licenses to sell adult-use cannabis under a ballot measure proposed by City Councilwoman Jill Gaebler. If the proposal appears on the ballot in November and is approved by voters, 24 businesses currently dispensing cannabis for medicinal use would be allowed to sell recreational pot.
Gaebler said that the sale of adult-use cannabis in Colorado Springs would generate badly needed tax revenue at a time when the economic downturn caused by the coronavirus pandemic has led to the city’s 2020 budget being slashed by $21 million. By legalizing recreational cannabis and imposing a 12% tax on sales, the city could raise $16 million to $18 million per year, according to Gaebler’s projections.
“We need to find creative ways to increase our revenues and this is an obvious way to do that,” Gaebler said.
Colorado Springs currently has 118 medical marijuana dispensaries that serve the city’s approximately 22,000 registered patients, but the city council voted in 2013 to opt out of the state’s adult-use cannabis market. Under Gaebler’s proposal, 24 of the shops would be allowed to exchange their medical license and sell recreational cannabis instead.
“It’s here and it’s not going to go away,” council President Richard Skorman said. “I can never imagine a time when the state’s Constitution is going to be changed,” noting that the city’s recreational marijuana customers currently travel to Pueblo, Denver, and other jurisdictions that have legalized adult-use sales.
Local Cannabis Industry Opposes Proposal
But the proposed ballot question is opposed by the Colorado Springs Cannabis Association (CSCA) because most of the current dispensaries would be locked out of receiving an adult-use license. Brett Moore, a spokesman for the trade group, said that with only two dozen licenses available, up to 80% of the current shops could be forced out of business.
“As far as the Cannabis Association is concerned, that is an arbitrary number picked out of the sky,” he said. “We would rather have no measure than a bad measure,” he added.
In a July 23 letter to the council opposing the proposed ballot question, the association wrote that the plan to license only 24 recreational dispensaries “upends existing free market dynamics, forces City Council to pick winners and losers in an established business environment, punishes entrepreneurship, penalizes individual investment in the community, and fails to honor the cap that council placed on marijuana stores in 2017.”
“We at CSCA believe that retail sales should be there, but we have to look out after our 118 businesses, and the established medical marijuana industry that’s built out in the last decade and throwing out a low number of retail stores will really wreck that economy,” Moore said.
Instead, the CSCA would like to see the city approve dual licensing, which would allow the medical marijuana shops that wish to also obtain a license for adult-use sales to do so.
“That’s as simple as having a medical license and a retail license on the wall,” Moore said, noting that “It’s being done all over the state with little fanfare and little problems.”
The Colorado Springs City Council is expected to discuss the proposed ballot question on Monday and decide if the body should proceed to a vote, which would require the support of a least five members to succeed. The proposal is also opposed by Colorado Springs Mayor John Suthers, who fears legalizing recreational marijuana will jeopardize the city’s bid to host the headquarters of the U.S. Space Command.