Marijuana issues stir the ‘pot’
ALAMOSA — Alamosa city councilors will have to answer some marijuana questions before voters do this fall.
If a petition drive to place retail and medical marijuana ballot questions before voters is not successful, will the city place its own marijuana questions on the ballot this November?
If the petition drive is successful, will the city still place its own marijuana questions on the ballot this November?
Does the city council want to ask voters to approve a tax on marijuana sales if voters decide to permit retail marijuana in the city limits?
If so, how much of a tax?
If voters approve marijuana businesses, does the city want to limit the number it will allow?
Members of the Alamosa city council discussed these and other questions during a work session Wednesday night and will continue those discussions as they face deadlines forcing them to answer those questions this summer.
Council consensus is not unanimous on whether the city should pursue its own questions on the ballot, but the majority of council members present Wednesday night tended towards seeking a tax on marijuana retail sales if voters approve them.
Currently retail sales of recreational and medical marijuana are not permitted in the city limits.
Alamosa City Manager Heather Brooks suggested a temporary moratorium on sales be imposed if marijuana questions pass this fall to give the city time to work out details on how it would handle marijuana businesses. For example, the city would have to determine what zones would permit such businesses, what the licensing requirements would look like and how many businesses the city would allow.
Those seeking to place marijuana questions on this November’s ballot have until July 7 to submit petitions with 212 valid signatures for each question. Two questions are currently proposed, one allowing medical marijuana use and another permitting recreational marijuana sales. The petitions have not yet been turned in to the city, Alamosa City Clerk Holly Martinez told the council.
Alamosa City Attorney Erich Schwiesow told the council that the language used in the petitions would be the language on the ballot questions, and if the city council did not like that language, it could place competing questions on the ballot.
He said the council could also decide to place marijuana questions on the ballot even if the citizen-driven petitions were not successful in acquiring enough signatures to force the issue.
He said the council had discussed that option last year when a similar signature drive was not successful, but one of the reasons the council decided against it last year was cost. There would have been no other questions on the ballot last fall. However, Schwiesow said the city has council races on the ballot this fall anyway, so the council might want to consider placing marijuana questions before the voters because it would not cost more to do so.
The council would have to decide in August if it wants to place any questions on the ballot this fall and would have to let the county know it wants to participate in a coordinated election by September 8.
Staff shared some potential ballot language that had previously been prepared so the council would have something to consider and staff would not have to start from scratch.
Alamosa Mayor Josef Lucero was not in favor of putting marijuana questions on the ballot if the petition drive failed to place the questions on the ballot.
Councilman Charles Griego disagreed.
“I personally feel, put it out there, let them vote,” Griego said. “If it passes, it passes. If it doesn’t pass, it’s a done deal. It’s from the people.”
Councilman Jan Vigil said it seemed like the city would be sending mixed messages if it wanted the ballot measure to be citizen driven but pursued ballot questions regardless.
Lucero said he had visited with quite a few people in the community, and many of them felt since marijuana is still illegal at the federal level, they do not want to see recreational sales in the city. They were not as opposed to medical marijuana for those who have doctors’ prescriptions, he said.
Lucero said this issue doesn’t seem to ever be resolved.
“It’s a bad weed that won’t go away,” he said.
Councilman Ty Coleman said if the petition effort to put the marijuana questions on the ballot failed, that would indicate there was not enough community interest in it.
“If they are unsuccessful, I personally do not feel we should move forward,” he said. “It’s a dead deal. There’s no need to continue to move down that road, in my opinion.”
Councilor Liz Thomas Hensley said she wanted to get more input from people in her ward and in the community.
Councilors Michael Stefano and Kristina Daniel were not present at the May 31 work session.
Brooks said the citizen proposed questions do not address taxation, so staff would recommend the city ask voters to approve taxes on marijuana, if voters approve marijuana sales in the city.
Schwiesow said the city could not impose a tax on marijuana sales without voter approval, so that would have to be placed on the ballot if the city wanted to seek a tax. Unless a ballot question combined the marijuana sales and taxation questions, it would be possible that voters could approve sales but not taxes, he added. The ballot questions proposed through the citizen petition process do not seek a tax, so the city council would have to develop a separate question related to taxation or propose its own ballot question tying taxes to sales.
(Taxation ballot issues can only be put before the voters during November elections.)
Griego favored putting a question to voters tying the approval to taxation.
Brooks said the city council might also want different language than is currently proposed for the recreational marijuana ballot question, which specifies that regulations would be similar to those associated with liquor licenses and not more restrictive.
“I am not sure we would agree with that,” Brooks said.
She and Schwiesow explained that even if voters approve the two currently proposed ballot questions, the city can adopt ordinances reflecting the voters’ choices but with different regulatory language, because what the voters would be approving would be ordinances of the city. Schwiesow said the council could legally even go against the voters’ wishes, but that might not be a good move politically.
“I just don’t want to complicate things for voters,” said Griego. He said he did not want so many questions on the ballot that it would be too complicated for voters.
“It is a complex issue,” responded Lucero.
The mayor said he appreciated the efforts staff had made on this issue.
“It’s not an easy issue to deal with.”
He said the council, who would ultimately take the brunt of this, had to determine what would be fair for a tax and what might offset the costs.
“Is it going to pay for itself?” he asked.
Schwiesow said the city could ask voters to approve a sales tax specific and solely related to retail marijuana sales. Normally that could not be greater than 5 percent, but since Alamosa is a home rule city, it could impose a higher tax than that, he explained.
Schwiesow added that some communities have chosen to go with a transaction fee such as $5 rather than a sales tax, so every time there is a marijuana transaction, a transaction fee is collected.
Staff conducted an unofficial survey of municipalities in Colorado with retail and medical dispensaries. Trinidad’s 9-percent sales, use and excise taxes levied on its 18 marijuana dispensaries generated $2.26 million last year. Pagosa Springs, which has two dispensaries collecting 4 percent marijuana taxes, generated $126,666 in 2016. Gunnison has eight dispensaries and like Trinidad has no limit on how many will be permitted. Gunnison imposes 9 percent in taxes and fees on marijuana dispensaries and received $135,000 in revenue last year.
Denver’s marijuana establishments (number not shown) generated $29.5 million in 2016 and Northglenn’s nine dispensaries generated $1.9 million. Pueblo has 22 marijuana operations (seven grow, three medical, four edibles and eight retail) but did not show how much revenue that generated in 2016 because the city does not differentiate marijuana sales tax from other sales tax.
Several resort communities such as Aspen and Steamboat Springs allowed multiple dispensaries. Aspen’s 2.4 percent tax generated $235,000 in 2016 while Steamboat Springs’ 8.5 percent tax brought in $431,112. Several communities ranging from Rifle to Frisco received more than $500,000 from marijuana taxes in 2016.
“The more dispensaries you have, the more money you are going to make, naturally, but what kind of impact is that going to have?” Brooks asked.
Alamosa Police Chief Duane Oakes said he had visited with the Trinidad police chief by phone and made a site visit to Durango where marijuana establishments are permitted.
He talked with both police and marijuana proprietors.
“We are hearing positive and negative from the vendors and mostly negative from law enforcement,” he said.
Violent crime has increased in Durango specifically related to marijuana sales, Oakes said. There have been three marijuana related homicides and two armed robberies there, one just a couple of weeks ago, he said. Durango authorities told Oakes that gang members came in from Arizona to do the armed robberies. The most recent incident involved a stolen rifle used in an attack on a marijuana delivery person.
Durango is also seeing an influx of transients, Oakes said, with many of them targeting Durango’s other “transient” population, the tourists.
He said the manager of one of the downtown Durango marijuana facilities told him Durango had always had homeless, but the transient population had increased, along with panhandling.
Trinidad has also seen increased crime rates, Oakes said, and people from other states are frequently coming into Trinidad for marijuana.
Oakes said Alamosa has also felt the residual effects.
“We have seen it already ourselves,” he said.
He said with marijuana sales in nearly every other county in the Valley and Saguache County “nothing but marijuana grow operations,” Alamosa has experienced residual effects such as an influx of transients.
“We are seeing the same effects as other communities because of other communities that have it around us,” Oakes said.
He added that Alamosa has experienced the crime associated with it as well.
For example a home invasion here was related to marijuana and other drug sales.
“They were gang members,” he said.
“The same thing Durango has seen their violent crime increase, we have kind of seen that already.”
Oakes said the Trinidad police chief handles marijuana-related issues himself and has a detective working almost full time on regulating marijuana. Trinidad did not limit the number of marijuana dispensaries, he said. Trinidad currently has 18.
Oakes said the Trinidad police chief “absolutely is overwhelmed.”
Hensley asked if a tax would help offset the negative impacts.
Oakes said, “The problem is if we allow retail/medical in the city, it’s going to cause additional work on top of what we already have. The revenue coming in isn’t going to make much difference.”
He added, “I don’t see an advantage of having tax revenue coming in. It’s going to cost us more in the long run.”
Caption: Alamosa council and staff discuss marijuana issues during a work session Wednesday night. Clockwise from left are City Councilors Ty Coleman, Liz Thomas Hensley and Charles Griego, Mayor Josef Lucero, Councilman Jan Vigil, Finance Director Judy Kelloff, City Clerk Holly Martinez, City Attorney Erich Schwiesow, City Manager Heather Brooks and City Police Chief Duane Oakes. Courier photo by Ruth Heide