Boulder's medical marijuana industry thins in face of strict city regulation

When Boulder first established a specific license to help regulate medical marijuana businesses in 2010, more than 200 pot-related companies -- dispensaries, grow operations and infused-product manufacturers -- already were up and running throughout the city, remitting sales and use taxes under generic business licenses. In November of that year, city officials received applications for the new medical marijuana licenses from 119 businesses, most of which already were open.

Yet today, nearly two years later, Boulder's marijuana industry has thinned significantly, with just 26 dispensaries and 32 grow operations still operating in the city. A strict approach to background checks weeded out many of those initial applicants, forcing them to shutter or abandon plans to open. But closures continue in Boulder; as recently as March, there were 32 active wellness center licenses in the city.

Some medical marijuana business owners say Boulder's strict approach to regulation has pushed even "good" operators out of the trade, and they wonder whether the intent of regulation was to winnow the number of businesses that opened during the green rush of 2009 and 2010. "It's like one strike and you're done," said Diane Czarkowski, one of the founders of Boulder Kind Care, the first Boulder dispensary to receive a business license from the city. Tired of dealing with regulations, Czarkowski -- who describes herself as "more of a vision person" -- sold her shares and got out of the pot business in March, though she still works as a consultant and advocate. Boulder Kind Care does not appear on a current list of licensed dispensaries provided by the city, and the center's outgoing phone message says it is "temporarily closed due to lack of product."

Boulder officials say their goal always has been a well-regulated medical marijuana industry, not necessarily fewer dispensaries. "I have never heard that or gotten the impression that that's what council wanted," Senior Assistant City Attorney Kathy Haddock said of limiting the number of dispensaries. "I do think they want businesses that follow the rules and that's important." Boulder is in the process of revising its medical marijuana ordinances in preparation for November's expiration of a moratorium on new business licenses.

The city is taking public comment on the issue until Sept. 21, and, as of Friday, officials had received more than 400 responses. At a meeting Friday with marijuana business owners, many pushed back against possible restrictions on advertising (could a T-shirt be considered advertising?) and labeling requirements (labs that purport to test the THC content of marijuana can return widely differing results, they noted). Afterward, Czarkowski, who hasn't ruled out getting back into the business, said she felt like Boulder is being more open to business concerns. "I left there feeling so much better about the attitude," she said. "I felt like we had a voice."