Pot Shops in Denver Open Door to $578 Million in Sales
Fox has arranged for canopy tents, heaters and a food truck to offer donuts
and pastries to patrons waiting for the state-appointed hour. She expects sales
at her 3D Cannabis Center, operating since 2010 as a medical-marijuana
dispensary near the Denver Coliseum, to surge to at least $250,000 a month from
$30,000, she said.
“We’ll have people out the door,” Fox, 42, a Salida resident, said by telephone. “It’s going to be a very festive atmosphere. We all feel like we’re walking on sunshine right now.”
Washington’s pot producers, processors and retailers each must pay the state a 25 percent sales tax, unless they hold both producer and processor licenses, which allows them to pay the levy once.
“We’ll have people out the door,” Fox, 42, a Salida resident, said by telephone. “It’s going to be a very festive atmosphere. We all feel like we’re walking on sunshine right now.”
Fox’s shop is among 14 in Denver that got state and
local licenses in time to sell marijuana to anyone 21 or older starting Jan. 1,
just over a year after Colorado and Washington voters made their states the first
to legalize recreational use. Washington’s shops are expected to open later in
the year.
Colorado projects $578.1 million a year in combined
wholesale and retail marijuana sales to yield $67 million in tax revenue, according to the Legislative Council of the
Colorado General Assembly. Wholesale transactions taxed at 15 percent will
finance school construction, while the retail levy of 10 percent will fund
regulation of the industry.
‘Large Lines’
“There are a lot of people interested to see what
these stores are all about,” said Brian Vicente, co-author of Colorado’s
recreational-marijuana ballot measure and an attorney with Vicente Sederberg
LLC, a Denver-based law firm representing the marijuana industry. “There will
be pretty large lines for these facilities.”
Licenses for 136 marijuana stores, a majority in
Denver, were mailed Dec. 23, the Colorado Revenue Department said in a statement. Recreational marijuana businesses can open only
after receiving both a state and local license, said Julie Postlethwait, a
spokeswoman for the Marijuana Enforcement Division.
Only existing medical-marijuana retailers can apply for the licenses until
July 1, she said. In Denver, home to the state’s largest number of such
dispensaries, that deadline extends through Jan. 1, 2016.
The city’s newly licensed shops feature names such
as The Green Solution, The Healing House Denver and The Denver Kush Club,
according to a map on the Denver city government’s website.
Ounce Limit
Colorado residents with a photo identification showing they are at least 21 may buy as much as one ounce of pot in a single transaction, while those from out of state can get a quarter ounce, Postlethwait said. Customers can’t consume the product in public, including at the shops.
Medium-quality marijuana sells for an average of
$196 an ounce in Colorado and $192 an ounce in Washington, according to the Price of Weed website, where
pot buyers can post what they paid.
“It will be an interesting time in Colorado in the next few months,”
Postlethwait said. “We’ll have things shake out and settle. That will give us an
opportunity to study what the face of the two segments of the marijuana industry
will look like.”
Marijuana possession and sale remains illegal under
federal law. In August, the U.S. Justice Department said it wouldn’t challenge the legalization laws in Washington
and Colorado provided the states prevent out-of-state distribution, access to
minors and drugged driving, among other restrictions.
867 Applications
In Washington, retailers will begin selling marijuana around June, according to Brian Smith, a spokesman for the State Liquor Control Board, which is overseeing the industry. The agency, which limits retail licenses to 334 statewide, had received 867 applications as of Dec. 24, he said.Washington’s pot producers, processors and retailers each must pay the state a 25 percent sales tax, unless they hold both producer and processor licenses, which allows them to pay the levy once.
Washington isn’t including revenue from marijuana
growth, processing and sales in its fiscal projections “due to the continued
uncertainty over the rules and structure of the market,” according to a November
report by the state’s Economic and Revenue Forecast Council.