Feds to Target CO Cannabis Dispensaries Next Year as Part of Widening MMJ Crackdown?

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Maybe Colorado’s well-regulated and tightly controlled medical pot industry isn’t so sheltered from federal prosecution after all.

The U.S. government is either considering or has already decided to move forward with plans to target some pot dispensaries in the state, according to various media reports.

The feds apparently are looking to focus on medical marijuana centers and cultivation operations located within 1,000 feet of schools, a similar strategy the government employed in California this fall.

If federal official move forward with the plan, they would first send warning letters to affected businesses, giving them 45 days to close or move to another location. The next step: force the operations to close.

The fact that the government is even considering such a move is a big blow to the Colorado medical marijuana industry.

Many industry observers felt that Colorado was protected from such actions, given the state’s strict oversight of dispensaries and cultivation businesses. Dozens of Colorado’s roughly 700 licensed medical pot centers are located within 1,000 feet of a school, especially in the Denver area. State MMJ laws bar pot centers from setting up shop near schools, but local officials made exceptions for existing dispensaries when it first implemented the regulations.

The Obama administration has been sending mixed signals on medical marijuana over the past two years, at first insinuating that MMJ operations complying with state laws are in the clear, then flip-flopping several times on the issue. This year, federal officials have conducted dozens of raids on medical pot centers and related businesses in California, Montana and Washington State. In some cases, it targeted operations that were clearly abusing local MMJ laws. But in others, the feds raided and shut down dispensaries that were complying with state laws.

Just last week, a government official indicated once again that the feds would put a low priority on targeting dispensaries that are in full compliance with state laws.

Alarms bells are now ringing in Colorado, where dispensaries are frustrated, confused and on the verge of panic. Many MMC owners spent tens of thousands of dollars – and in some cases over $100,000 – to comply with the state’s strict new regulations, which went into effect on July 1. Now, they might lose everything or have to spend another small fortune to move to another location.

“This is an incredibly disturbing story, especially given that just last week, Attorney General (Eric) Holder indicated that MMJ businesses in unambiguous compliance with state law would not be a federal enforcement priority,” Mike Elliot of the Medical Marijuana Industry Group, a trade and lobbying organization, wrote in an email to members.