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From: Macon Cowles
Date: August 29, 2015

Memo to Council re MJ Regulations

I call on Council to fix the MJ regulations during this term. Consistent with the request, I
have asked CAC, on behalf of George Karakehian and me, to rearrange Council
schedule so that we can have a special meeting on MJ regsas we did for VRBOs
and then follow it up with First and Second Readings before the current Council term
expires November 10.
Table of Contents
Unfettered Discretion........................................................................................................1
Broad categories in which Boulder MJ regulations are out of step with the State and
other local jurisdictions.....................................................................................................2
The Remedy.................................................................................................................... 3
Procedure........................................................................................................................ 4

Unfettered Discretion
Boulder MJ regulations are out of step with those of other jurisdictions and of the state.
The Zero Tolerance policy for violations gives unfettered discretion to a City
administrative department with no reasonable opportunity for licensees to challenge the
exercise of that discretion.
As examples of how unfettered discretion with no right of review is being exercised, I cite
the following:
Sale of Merchandise. Council loosened the regulations for the sale of merchandise on
December 16, 2014 to permit the sale of items with a stores name or logo. See, BRC 616-8(p)(1)(C). Council intended to expand the type of items that could be offered for sale.
However, City Tax and Licensing has interpreted this to mean that stores could not sell
any item that had anything other than the logo or name of the store.
For example, the City Tax and Licensing department required The Farm (Recreational
MJ licensee) to remove from its store all of the following items which the Department
concluded were nonbranded merchandise despite the fact that The Farms cow logo
can be clearly seen on each item.

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The licensee of course complied immediately with the directive of Tax and Licensing. But
there was no reasonable way for the licensee, had it wanted to, to challenge this
interpretation of BRC 6-16-8(p)(1)(C).
Violations and Assessments of Fines. Terrapin (RMJ licenses) was jointly inspected
by the State of Colorado and by Boulder Tax and Licensing April 9, 2015. The State
notified the licensee during the inspection that the licensee was in compliance with all
regulations. However, the next day, City Tax and Licensing returned to say that despite
compliance with State regulations, Terrapin was in violation of Boulders MJ regulations.
The licensee immediately addressed the violations including paying a private contractor
$17,000 to construct a large safe to store product between business days, even though
the product had been stored behind a steel roll down door which the State inspector
found to be adequate security.1 Four months later, on August 14, 2015, Terrapin received
a notice that the fine assessed for the April violations was $7,000.00. Terrapin had no
reasonable way of appealing either the violations or the amount of the fine, which has
already been paid.
The Denver Board of Health Inspectors, in the matters under their jurisidiction, provide
written notices of violations at the time of the inspection. Our Tax and Licensing should
1 The State requires secure storage of MJ product between business days whereas the City

requires the product be stored in a safea term that is not defined in the City Code. Terrapin
thought that securing the product in a solid case with steel roll down locking doors met both
requirements. Tax and Licensing did not agree.
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do the same with marijuana inspections. And the fines are set, not by the inspectors, but
by management personnel. And if the licensee challenges the violation or the fine, there
is a speedy, inexpensive administrative hearing where neither side has to engage
lawyers.

Broad categories in which Boulder MJ regulations are out of step with the
State and other local jurisdictions
What follows is a short list of the ways in which the City of Boulders MJ regulations are
out of step with regulations and permissions of the state and competing local
jurisdictions.

The grandfather rule in other jurisdictions permits the sale of non-conforming

businesses; ours forbids that. The grandfather rule in other jurisdictions also permits the
sale of plants by conforming businesses to the purchaser of the business. Ours requires
the plants be destroyed. Boulder is out of step.

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The Remedy
There is a hard way and an easy way to remedy to problem with Boulders MJ regs, both
medical and recreational.
The hard way is to take the list of 40 items or more that have been identified as stress
points where unfairness lies, and amend each section of Boulders ordinances, but also
making sure to correct the mismatch that now exists between one regulatory framework
the Statesand the otherthe Citys. They simply must be aligned, as licensees are
required to obey both.
The easy way is to repeal BRC 6-14 (medical marijuana regulations) and 6-16
(recreational marijuana regulations) and adopt a new ordinance that addresses only the
processing of applications, the performance of inspections, a schedule of fines and
provides a hearing officer type of administrative review that does not require lawyers for
challenges to the exercise of authority by Tax and Licensing.

Procedure
I suggest we defer the items now scheduled for the September 17 study session
(Resilience and Mobile Home Park Policy) and schedule, as we did for short term
rentals, as special meeting on September 17 to discuss all aspects of MJ regulations
and give direction to staff. Alternatively, let's add a special meeting to one of the
Thursdays during September. Either way, we hope that this matter can be sheduld so
that First and Second Readings occur in October.

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