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Colorado Cannabis Regulations Evolve With New Legislation

Colorado Cannabis Regulations Evolve With New Legislation

Out of 30 bills focused on regulation of marijuana and hemp production and sales in Colorado, 12 have made it into law for the 2015 legislative session.

The session reflects the latest concerted efforts by Colorado legislators to keep up with a burgeoning industry. Sen. Pat Steadman, a proponent of many of the regulation and tax bills, stated:

“The Legislature is going to pass a dozen marijuana bills a year, here for the foreseeable future, just as we continue to tinker with this and address some of the loopholes and problems we discover along the way.”

One of the loopholes is getting sewn up this session by Bill 1387, which prevents medical marijuana growers from transferring plants to recreational production facilities without paying an excise tax. The new bill imposes a 15 percent tax on all such transactions.

Just days before the session ended, Gov. John Hickenlooper pushed for a $300,000 budget allowance to clamp down on the use of toxic pesticides in cannabis production. Recently, 12 facilities that grow marijuana for consumption were tested for unsuitable chemical use. Potentially affected plants are currently in quarantine while the results of the tests are established. As it stands, a formal complaint must be made in order for the Department of Agriculture to investigate suspected contaminants.

The governor’s budget request is part of a greater effort to keep pace with a growing market while meeting the challenges of establishing standards for public health and safety. The governor and other officials are looking to pay for expenses such as testing for pesticides with some of the $58 million in tax revenue estimated to come from the marijuana industry for fiscal year 2014-2015. An upcoming ballot measure will ask voters if they want that money to go toward programs concerned with marijuana use and production or if they want a refund.

Following Hickenlooper’s request, a position for a marijuana black market intelligence analyst was approved for the 2015-2016 budget. The role will become part of the Department of Public Safety and will be filled after June 30. The creation of the position is intended to help end the illegal diversion of marijuana across state lines. A lawsuit brought against Colorado by Nebraska and Oklahoma is currently pending in the U.S. Supreme Court regarding this issue.

One of the more controversial pieces of legislation is Bill 14, which creates a registry for caregivers who provide marijuana for medicinal treatment. Caregivers have been legally providing medical marijuana to patients in Colorado since 2000, predating the licensed dispensary system by 10 years. Bill 14 addresses alleged abuses that resulted in people using the caregiver system to turn an illegal profit. In addition to having to register, a caregiver would be limited to an inventory of 99 plants. A medical marijuana provider license would be required for more than that. Some groups are threatening to sue over the law, claiming the plant limit is unconstitutional.

Other legislation will allow investors from other states to invest in Colorado cannabis businesses, and there were several addressing standards and methodologies for testing for potency and contaminants.

Sen. Kent Lambert, R-Colorado Springs, chairperson of the Joint Budget Committee, stated:

“A lot of this is catching up with what’s been going on.”

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