City to set higher fees for dispensaries

Rasta Stevie Smith, left, Wes Drobney, center, and John Menzies of Animas Herbal Wellness Center speak before the Durango Local Licensing Authority on Tuesday afternoon. Animas Herbal Wellness received probation for failing to inform the city of Durango of a remodel. Enlarge photo

STEVE LEWIS/Durango Herald

Rasta Stevie Smith, left, Wes Drobney, center, and John Menzies of Animas Herbal Wellness Center speak before the Durango Local Licensing Authority on Tuesday afternoon. Animas Herbal Wellness received probation for failing to inform the city of Durango of a remodel.

Fees could get high for medical marijuana businesses if the City Council adopts Tuesday’s recommendations from the Local Licensing Authority.

The application fee for a business license could more than triple from $875 to $3,000. The fee for transferring ownership or location of a business would increase from $600 to $3,000. Annual license renewal fees would jump from $200 to $2,000.

Durango also would impose a slate of new charges that had previously cost nothing. To change the layout or premises of a business would cost $2,000. Changing the corporate stock structure would cost $1,000.

The council could adopt the new fee schedule as soon as July 3.

Jonny Radding, an owner of Durango Organics, called the proposed fees a “little extreme,” predicting it would put medical marijuana dispensaries out of business.

But Durango Police Chief Jim Spratlen said the fees are comparable to what other cities such as Denver and Boulder charge.

Spratlen told the licensing authority that “it has become apparent that the city does not charge enough fees to support the significant workload associated with medical marijuana.”

Spratlen referred to inspections, audits and the paperwork associated with regulating the industry, but Radding noted the state and city impose some onerous regulations, such as requiring two years of tax returns for all senior or key-level employees.

City Attorney David Smith then asked Radding, “Do you want to turn your business over to someone who’s unwilling to provide two years of tax returns?”

Radding responded that Mitt Romney, the presumed Republican nominee for president, has been reluctant to release his tax returns.

Failure to notify the city about a remodel or allowing a new employee without a badge to sit in a restricted area can result in probation for medical marijuana dispensaries, according to Tuesday’s hearing.

The Animas Herbal Wellness Center, 1111 Camino del Rio, got six additional months of probation on top of a six month probation period that started in March.

The dispensary had changed the layout of the business ahead of a state inspection, but neglected to inform the city about the remodel, resulting in a new city violation. The dispensary needed to change its layout to comply with state rules about the placement of security cameras.

Animas Wellness owner John Menzies acknowledged embarrassment about the error, but said his business was “trying to be responsible” in following state regulations.

Rocky Mountain High, 48 East Animas Road (County Road 250), got three months of probation because a new employee who had previously worked for the dispensary as a manager was seen sitting at a computer in a restricted area during a city inspection.

The employee was not wearing the required badge, but Rocky Mountain High representatives disputed that she was in a restricted area.

jhaug@durangoherald.com