AURORA | Aurora will have tough requirements in place for businesses to even be able to apply for retail marijuana licenses in July. To win one of the city’s coveted licenses, the system tentatively approved this week force applicants to comply with a unique list of city demands or risk losing out.
One requirement, which says applicants must have $400,000 in cash, will be the first of its kind implemented by a city in Colorado. That’s in addition to applicants needing a clean criminal background, and at least two years of experience operating a marijuana business to pass the first round of the city’s application process.
A heavily amended version of a year-in-the-making ordinance for retail marijuana licenses in Aurora received near unanimous approval at a council meeting Monday night, with only Councilman Bob Broom ultimately voting against the measure.
Under the measure, the city’s six wards will be limited to having only four stores, with a total of 24 potential marijuana shops located throughout the city. There won’t be any spacing requirements between the shops, but they will be required to be located 1,000 feet from schools and 500 feet from hospitals.
During the meeting, Councilman Bob Roth proposed numerous amendments to a points system the city will use during its licensing process to weed out applications once they meet the basic requirements. The city has no such system for other business licenses. Both supporters and critics liken it to the request for proposal system used to grant government contracts.
One change, which was approved by a vote of 8-2 with council members Bob Broom and Molly Markert voting no, will award businesses up to 10 points for providing an operating plan with their application. Roth said the plan would include information such as staffing details, employee training manuals, and proactive consumer education practices the applicant plans to pursue.
“How is our staff supposed to judge if it is a 1-point plan or a 10-point plan?,” asked Councilwoman Markert.
“Staff is familiar with looking at RFPs (request for proposals) and familiar with judging RFPs on merits they provide,” Roth said. “We use subjective criteria for a lot of other things we do in the city. we recently selected an executive placement firm to look for a new city attorney.”
Roth also pushed through an amendment that would give up to 10 points to applicants who provide an in-depth business plan that lists the scope of working for planning and capital development as well as first year operating expenses and revenues.
The motion passed 6-5 with council members Broom, Mounier, Peterson, Markert and LeGare voting no.
“We should rely on the fact investors are investing $400,000 to $1 million, and let that be the business plan,” LeGare said.
The points system as written, already favors applicants with more than two years of industry experience, a spotless business background, and those who install a filtration system and an enhanced security system.
But lawmakers and Denver industry leaders drilled home during the meeting that more criteria, not less was needed to help the city choose the best operators. Under the measure, businesses that accumulate the most points will receive the license, and if there is a tie between multiple businesses for one spot, the winner will be decided by lottery.
“We think you get the best by creating a process that highlights the differences between applicants,” said former Aurora Mayor Ed Tauer, who now works for the marijuana industry. His opinion was echoed by Denver industry leaders like Meg Collins, executive director of the Cannabis Business Alliance, and Bruce Granger, who owns a Glendale-based dispensary called Kind Love, and wants to open another in Aurora.
City Finance Director Jason Batchelor responded to questions from council about the change in the points system that city staff will have to adjust its approach to licensing now that the criteria includes subjective materials like a business plan.
Councilwoman Barb Cleland proposed an amendment that will not allow a business owner to have more than 6 retail marijuana licenses in Aurora, pointing out that otherwise, one person could hold a monopoly. The amendment passed 8-2 with council members Hunter Holen and Markert voting no.
City staff will charge each marijuana retail store an annual operating fee of $17,500. The City has appointed Robin Peterson from the Finance Department to head the new licensing division, and has set aside $101,600 to fund the 7-member, interdepartmental division. According to city documents, Aurora could garner $2.8 million a year with the 24 retail locations without adding a special sales tax to marijuana.
Under the measure, stores will be open from 8 a.m. to 10 p.m., which means they will close three hours later than stores in Denver.