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The year in marijuana

Thefts a worry, but business booms

More than a year after shops in Colorado began selling retail marijuana, the fledgling industry is looking for legitimacy.

Most banks won’t work with marijuana businesses, cannabis entrepreneurs say.

“It’s still impossible to get (bank) accounts,” said Jonny Radding, co-owner of Durango Organics, which has a medical dispensary and a retail shop.

Despite federal guidance that sought to assure banks they could work with pot operations, marijuana remains a cash-only business. That affects day-to-day operations, Radding said.

“It’s difficult to pay our employees,” he said. “It’s difficult to pay our taxes.”

The cash transactions also pose significant risks, which is something the Durango Police Department is watching.

“The public safety concern of ours right now is the cash transactions that happen, because it’s an enticement for people,” said Lt. Ray Shupe, spokesman for the department.

Many marijuana businesses have begun hiring armed security to transport the cash, which has helped reduce the risks, Shupe said.

Cannabis businesses and regulators continue to work out the kinks. But banking is not the only pressing issue.

Marijuana business people also have complained that it’s difficult to offer traditional benefits, from health insurance to 401(k) accounts because companies are reluctant to work with pot businesses.

“As great as everything is, the business is still challenging to run,” Radding said.

Retail marijuana is still a new experience. It didn’t start in Durango until Sept. 26, when Durango Organics became the first local retail marijuana shop to open.

The Colorado Marijuana Enforcement Division closed Durango Organics’ retail shop later that day because of a mixup regarding potency testing. The shop reopened in early October.

When Durango ended a moratorium on retail marijuana applications July 1, sales had been ringing up in Denver, Telluride and other Colorado cities for six months. Durango Organics’ first retail sale came nearly two years after Colorado voters approved retail marijuana sales in November 2012.

Customers and retailers have been making up for lost time.

Customers – many of whom hail from other states, and some of whom are revisiting marijuana after abstaining for decades – are enjoying a passel of products, from THC-laced candies to hash-oil-packed electronic cigarettes.

As the products have proved popular, the industry is expanding.

Durango Organics was followed by two other retail stores, Santé Alternative Wellness and Animas Herbal Wellness Center. A fourth, The Acceptus Group, has been approved at 965½ Main Ave. but has not yet opened. What would be the fifth retail shop, Rocky Mountain High, has received the go-ahead from the city of Durango’s Planning Department but still must win approval from the Local Licensing Authority.

Durango also has eight medical marijuana dispensaries.

Marijuana advocates point out the sky has yet to fall several months into Durango’s experience with retail marijuana. Visible issues stemming from marijuana have been few. Some of the problems that have arisen could happen to any business, such as complaints about Santé’s customers parking illegally or in spaces belonging to other businesses.

Yet there have been issues. In August, two young men walked into Animas Herbal Wellness, 1111 Camino del Rio, and fired pepper spray at an employee before grabbing a jar of marijuana and fleeing, according to police.

Two 17-year-olds were arrested and charged with felony aggravated robbery. The incident occurred in Animas Herbal’s medical marijuana dispensary; the retail side was not yet open.

Shupe said local marijuana businesses have experienced repeated break-ins.

“There have been some pretty significant thefts that have happened,” he said.

As the nation’s first state to conduct legal, recreational sales, Colorado is under the microscope for advocacy groups on both sides.

The Drug Policy Alliance recently released a year-end report touting decreases in violent crime and property crime in Denver, along with a slight decline in statewide traffic fatalities.

Retail marijuana also brought in $40.9 million in tax revenue through October, the Alliance said.

Meanwhile, another group, Smart Approaches to Marijuana, pointed out the downsides. Accidental ingestions of marijuana products by children rose to 14 during the first half of 2014, up from eight during all of 2013.

There has also been an increase in burn cases from users making hash oil at home, the group said.

The Healthy Kids Colorado survey showed past-month pot use among teens fell in 2013 to 20 percent, down from 22 percent during the previous survey in 2011. It remains to be seen how the spread of retail marijuana in 2014 will affect usage rates.

The marijuana industry is providing an unusual avenue of employment for many Coloradans. The state has licensed 16,000 industry workers, the Alliance reported.

Durango Organics – just one of the city’s eight marijuana operations – has about 36 employees, all of whom make comfortably more than minimum wage, Radding said.

He hopes the state provides a positive model for others.

“I’m hopeful that in 2015, we’ll see a lot more states turn to medical, a lot more states put retail on their ballot,” Radding said. “This old stigma, this old propaganda, isn’t true. We think people are becoming more accepting. We’re going to see the tide start to change.”

cslothower@durangoherald.com



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