cannabis

Alpine Wellness owner Michael Grady displays two of the many strains of cannabis flower his shop offers. (Photo by Suzanne Cheavens/Telluride Daily Planet)

In 2014, the world as we know it changed — in Colorado, at any rate. State voters approved Amendment 64, making the state the first in the country to welcome regulated, state-licensed retail cannabis dispensaries for recreational users. What once required a special permit and a doctor’s assessment — for medical marijuana — could now be had with a valid ID proving one’s age 21 and older.

The Town of Telluride embraced the new laws and created a set of its own to regulate and tax the burgeoning industry. Little could be projected about the success of this new enterprise. Today, five cannabis dispensaries sell a wide range of cannabis products, ranging from flower to edibles, from vaping supplies to topical products.

From the sales of cannabis, the town realizes steadily increasing tax revenues — in 2018 (through September) that figure is $51,900, which reflects a 10.26 percentage increase over 2017, despite the fact that three months aren’t on the books yet and that it was a dismal snow year.

Last winter was a tough season for any Telluride business, and one cannabis retailer, Alpine Wellness’ Michael Grady, called it “a major swing year for us.”

It wasn’t just the money and sales that were skewed by last winter’s stingy weather gods.

“This time last year tourists were frustrated,” Grady said. “There was a lot of weird energy around town.”

Another factor that made an impression on the local retail cannabis scene was the arrival of a fifth shop, Green Dragon, a chain store that settled on Colorado Avenue. The Green Room, Telluride Bud Company and Delilah round out the roster of Telluride’s cannabis dispensaries.

“It was our first winter with a new shop in town, which is completely acceptable” Grady said. “It was difficult and hard, but we emerged with more passion and purpose.”

This winter, he said, there is more traffic and happier people.

“When there isn’t snow, tourism is limited to school schedules,” he observed. “This winter we’re seeing travelers booking out of the box. We’re seeing mom trips and dad trips, and lots more regional traffic from Denver, Durango, even Montrose.”

Grady also gives credit to not only abundant snow, but to the prowess of the people who are booking music acts that appear at venues like Club Red, The Liberty and the Sheridan Opera House. Music fans, he noticed, are traveling to Telluride to see their favorite bands and stopping in local dispensaries to stock up.

“Music is a draw,” he said. “Other people’s efforts have gone into making this a good season. It takes the whole community to make things work. This winter things are better than ever.”

Grady said Alpine Wellness experienced upticks in business when Emancipator, Papadosio, the Floozies and Kitchen Dwellers rolled through town.

Much has changed since the landmark year of 2014. Cannabis retail, Grady said, was vertically integrated, meaning that shops grew and sold their own flower. Since then, regulations have allowed for large-scale commercial grow operations that compete with one another for the wholesale market. Today, Alpine Wellness is the sole Telluride dispensary that grows its own flower locally. This difference, he said is, “Kind of an Anheiser-Busch versus craft brewing scenario. What people want is good marijuana. Not necessarily cheapest, but good.”

Another change is the emphasis on the levels of THC (tetrahydrocannabinol) found in the plant.

“It never used to be about potency, it used to be about ritual and process,” Grady said.

Aside from the esoteric nuances of the cannabis experience, for municipalities that have permitted cannabis retail, the money collected from its sales can have notable, positive impacts on yearly budgets. In Telluride, where the taxes collected go into the general fund without specific, earmarked projects designated for its use, it’s a relatively small fraction of town’s overall budget, according to town finance director Michael Rodriguez. As that economic sector matures, there are some discernable trends.

“There has been a steady increase in collections,” Rodriguez said. “But I see growth somewhat flattening out on the local market.”

Still, it’s a small town and if a shop closed its doors or an additional shop came on line, that would, he said, “certainly have a major impact on collections”

In Ridgway, where there are currently four cannabis dispensaries open to capture travelers heading to Ouray or over Dallas Divide to Telluride and points west and south, town officials decided not to specifically tax its retail weed shops. According to a recent report in the Denver Post, the town’s budget nearly doubled since 2014, due in large part to the town’s cannabis businesses. Ridgway’s sales tax is 3.6 percent. Town Manager Jennifer Coates told the Post the town collected $214,476 in marijuana taxes in 2017. Total sales tax revenues from all sources have exceeded $1 million annually since 2016. Calling the robust tax collections “Christmas money,” and not to be taken for granted, given the industry’s untested future performance, Ridgway has steered the money toward numerous improvement projects like a new plow, broadband infrastructure and the hire of a town planner.

Statewide, a portion of the taxes collected are earmarked for brick and mortar school improvements (the BEST fund, which is funded, in part, by the excise tax exacted on cannabis retail).

Over and above the $40 million that goes into BEST, in 2017 Colorado legislators awarded rural school districts $30 million to use as they see fit. On the Western Slope, the Montrose School District received nearly $1 million, which district officials directed to STEM curriculum and enhancing school security measures.

By August of last year, total sales of cannabis in the state reached $1 billion.