AURORA | City lawmakers came closer Monday night to defining Aurora’s coming retail marijuana business, backing a system that rates applicants based on a criteria such as background and experience.
During a special study session, city council tentatively approved a points system and restrictions that would limit the city to 24 retail shops scattered equally across Aurora’s six council wards. The proposal still must win formal approval at a future council meeting. The earliest shops could open is October.
The points system for scoring applicants would be unique in a state that is blazing a trail in legalized marijuana. Denver holds hearings for potential pot shop owners.
A major decision whether to add a special sales tax to Aurora marijuana sales is still undecided. Such a tax would require voter approval, as it did in Denver.
Council members appeared to struggle with creating numerous restrictions and rules, and creating an industry that would be competitive with shops in others cities. Some council members pushed for longer store hours and lower taxes than shops in neighboring communities in an effort to draw sales to Aurora.
In an effort to prevent retail marijuana stores from crowding into north Aurora, each of the city’s six wards may be limited to having only four stores, with a total of 24 potential marijuana shops located throughout the city. In contrast, special spacing requirements between liquor stores is 2,000 feet apart.
“We’re supposed to be small-business friendly,” said Councilwoman Debi Hunter-Holen. “We are setting up restrictions which are beyond reasonable. If you limit by ward, you could narrow the distance between the establishments, but then you still only have a certain amount in each ward. It makes it easier for a business to get their property secured.”
Retail marijuana would still be required to be located 1,000 feet from schools and 500 feet from hospitals.
The city council agreed to keep a minimum cash-on-hand requirement of $400,000 for each applicant but scrapped some parts of their bonus-point system, which would have given license applicants an added preference if they are willing to build a new building or substantially remodel a facility. They agreed that additional points should be awarded to applicants whose building includes a filtration system to minimize public odors, as well as those who have security measures that go beyond the minimum requirements.
Those minimum requirements include installing a permanent safe or vault to store marijuana products and cash when the business is closed, video surveillance cameras, a Dumpster with a metal locking lid and a manager or owner on site during normal business hours.
City staff anticipate charging each marijuana retail store an annual operating fee of $17,500. Finance Director Jason Batchelor says that number was based on the city having to regulate and inspect about 20 retail stores, with 20 accompanying cultivation businesses.
The stores would be licensed by a new division in the Finance Department, consisting of seven staff employees, according to Batchelor.
“We would pull together a cross-departmental team to cover that. We would recommend that we inspect those businesses quarterly, and then once we have an idea of what community and business compliance rate is, we might be able to adjust that going forward,” he said.
Former Denver City Attorney Doug Friednash, who has been helping the city council’s Amendment 64 Ad Hoc Committee navigate state marijuana laws, said the fee was more than most cities with licensing requirements.
Council also agreed to limit retail hours from 8 am to 10 pm, which means they would close three hours later than stores in Denver.
Batchelor said Aurora could garner about $2 million a year with 20 store locations and without adding a special sales tax to marijuana. He said the amount was a conservative estimate based on an average ounce of marijuana costing $200.
“I know current retail is going for more than that,” he said.
“People are going to look for a lower tax. Why not have people buying in Denver come and spend their money here?” suggested LeGare.
The city council remained divided on whether to put a measure on the November ballot about a special sales tax for marijuana.
“If a citizens group wanted to petition to have a sales tax rate and designate for specific funds, can they do that?” asked Councilwoman Molly Markert.
City staff said such a ballot measure for the special sales tax would be at least a 300-day process that would require more than 8,000 signatures from citizens, and would need to be completed by September 5.
“We have until November 2015 to have that discussion. We can’t get it on the ballot this year,” said Councilman Bob Roth, chairman of the Amendment 64 Ad Hoc committee.
What a joke these guys are! It’s obvious by the restrictions placed so far, it will limit the number of stores in Aurora to only owners who have plenty of capital. Funny how no such restrictions are placed on basrbershops, auto repair shops or most of the other businesses in Aurora. So why this industry…… because there’s BIG MONEY involved and odds are, city council members want to get in on it. I would guess that some members will be “investors” (silent and hidden) in some of these stores.
They are trying to limit stores to a few sharp legitimate business owners to avert the BS that would occur (for example buying from illegal sources) if every breaking bad high school dropout was allowed to open a store on every corner. That’s an exaggeration, but you get the point. MJ does attract more than it’s share of undesirables. It’s unfortunate that small guys can’t get into the business, but there are very good reasons for being selective. As far as the inane but amusing silent investor conspiracy theory there are conflict of interest laws in place.
Being restrictive, doesn’t necessarily mean eliminating competition, as do the proposed rules. I would think there are a lot of legal and illegal pot suppliers who can easily come up with the $400K. So it won’t necessarily mean a better “class” of business owners. As for conflict of interest laws, what’s a few laws mean, we can get around them. Sorry, just cynical about all levels of government anymore!