There are really three new laws in the marijuana industry in Colorado for 2020. The first is House Bill 1234 which allows for the commercial delivery of marijuana. Now, this will only affect the medical marijuana dispensaries. The recreational dispensaries will not be allowed to deliver until next year in 2021. When will the delivery services for medical marijuana start? It’s all in the hands of your local municipalities. When and if approved, medical marijuana could be just a phone call away.
Two new types of marijuana-related businesses will be allowed 2020, thanks to House Bill 1230. The first is a separate license allowing for tasting rooms that can sell cannabis products on-site, a “retail hospitality and sales operation”. The second type allows for a new “hospitality establishment” that allow the on-site consumption, but the sale of cannabis is prohibited. These hospitality establishments will include mobile facilities like tour buses.
You may ask, what’s the big deal with tasting rooms and hospitality businesses? Back when Amendment 64 legalized statewide retail sales, growth and possession of recreational marijuana in 2014, some residents and tourists have been forced to find resourceful ways to partake in the consumption of marijuana without any legal and public option. There have been gatherings such as cannabis friendly yoga, art classes, cooking classes and hotels which have used the “private residence” rule and sidestepped the legal issue which provided an option for consumers in the past. There are two social marijuana consumption businesses that have receive a cannabis consumption license through Denver’s Initiative 300 program already in Denver, allowing for adult marijuana consumption in designated areas, but no flower smoking is permitted. The Coffee Joint and Vape and Play do allow vaping and THC edible consumption on their property, but again no selling of cannabis. With the new law, we would expect to see more hospitality establishments popping up in more recreational friendly towns than just Denver.
With House Bill 1230, anyone can apply for a state license but, it is at the discretion of individual municipality, allowing them to decide if, when, where and how these new businesses operate. Application fees range from $1,000 for a hospitality business to $5,000 for a retail hospitality and sales operations. Once granted, operators are barred from holding a liquor license for the same business. One of the challenges for the hospitality businesses that can not sell cannabis will be the ability to turn a profit and stay in business. Without the ability to sell liquor, business will have to look at other options such as food prepared on site or third-party options. These types of issues will have to be handled by local municipalities.
At this point, the state is accepting new applications, but no time table has been set by any local municipality to allow for the delivery of medical marijuana, the establishment of tasting rooms or hospitality businesses. Some may elect to opt out and prohibit these services in their cities. But my guess is that once a few cities establish their own ground rules, we can expect more towns to join the party.