Crackdown Comes to Colorado: Feds Forcing 23 Dispensaries Near Schools to Close Shop, Relocate

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A federal medical marijuana crackdown that started in California and then spread to Washington and Montana has now made its way to Colorado, threatening what many see as the most stable MMJ industry in the country.

The U.S. Attorney’s office sent letters to 23 Colorado pot dispensaries located within 1,000 feet of schools, ordering them to close or relocate. Those that don’t comply within 45 days will face federal prosecution and could have their assets seized, the letters warn.

“In addition to potential criminal prosecution and civil enforcement action, you are further advised that real and personal property involved in the sale and distribution of marijuana is subject to seizure by and forfeiture to the United States, even if in compliance with state law,” according to the letter, which is signed by U.S Attorney John Walsh.

The federal government also is threatening the landlords that lease space to these MMJ businesses, warning that their property and any money they received from dispensaries could be seized. Officials acknowledged the state’s voter-approved MMJ law but indicated that some dispensaries are pushing the boundaries.

“When the voters of Colorado passed the limited medical marijuana amendment in 2000, they could not have anticipated that their vote would be used to justify large marijuana stores located within blocks of our schools,” Walsh said, according to the Associated Press.

The medical marijuana industry in Colorado now faces an uncertain future: The federal government called the letters a “first step,” indicating that officials could take additional actions to close dispensaries in the months to come.

Those two words are extremely disconcerting to dispensaries, grow operations and edibles manufacturers. Many observers felt that Colorado’s medical pot industry was more or less immune to federal prosecution because of the state’s strict MMJ laws. But now it appears that no one is safe, and it’s unclear exactly what the Obama administration intends to do next.

The government mandate will affect about 3% of Colorado’s roughly 700 dispensaries. Some will no doubt relocate to other areas further away from schools. But others won’t be able to afford the move after having spent tens of thousands on recent compliance measures.

Colorado medical marijuana laws stipulate that dispensaries must be at least 1,000 feet from schools. But some medical cannabis centers were already operating when that measure was enacted, so the state grandfathered in those businesses.

While the individual dispensaries are likely up in arms over the move, the state’s medical marijuana industry seemed to take the news in stride. Many MMJ professionals have expected some sort of crackdown since last month, when U.S. officials said they were considering targeting Colorado. In other states that have faced a crackdown, the government also initially set its sights on marijuana dispensaries that were operating within 1,000 feet of schools.

It’s also somewhat difficult to argue why dispensaries should be allowed so close to schools.

“We are looking into the situation now,” said Michael Elliott, executive director of the Medical Marijuana Industry Group (MMIG), a Denver-based trade organization for the industry. ” We fully support keeping regulated substances out of the hands of unauthorized users and schools.  Towards that end, MMIG is in the process of putting together, and will announce soon, the details of a public education campaign to help educate medical marijuana patients about how to keep their medicine safe and secure.”