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Impacting Your Business - the Scope of Medical and Retail Regulations

Posted by Ken Tapman on Mar 8, 2016 9:30:12 AM
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Continued from last week: Beware the Regulators...Not the Sheriff

Attached to this article are highlights of and links to MED’s current regulations for both medical and retail marijuana. The review below of selected MED’s Work Group titles alone indicates the scope and level of detail of Colorado’s government regulation. (See Attachment 1. Notice of Colorado Rulemaking (

The true extent of Colorado’s cannabis regulations is found when you review the actual Medical Regulations that are some 135 pages ( and the Recreational Regulations that are some 144 pages. (

MED’s Work Group Titles & Recent Agenda Items (2015)

  1. Testing, Packaging and Labeling
    • Retail
    • Medical
    • Potency Variance
    • Process Validation
    • Industrial Hemp Testing
  2. Production Management
    • Medical Conversions to Retail
    • Current Production Management
    • Number and ranges of plant count/production tiers
    • Transitioning towards one license per licensed premises
    • Existing ownership interest provision for obtaining additional cultivation licenses
    • Limitations on total number of cultivation licenses any person can have an interest in
  3. Licensing and Permitted Economic Interests (PEI)
  4. Licensed Premises, Enforcement and Compliance
  5. NB14-1361 & HB14-1366 (Major Statutory Revisions)

Colorado’s Collaborative Process – Work Groups

MED adopted a highly collaborative process to develop industry regulations. The Division staff initially assembles work groups made up of stakeholders and subject matter experts to deliberate and provide direction and guidance for the proposed language with which to begin its formal rulemaking process. From a business perspective, these “work groups” are the most important places to focus. Typically, work groups were fairly small, perhaps as many as 20 participants, so you can be sure to have the opportunity to share your thoughts, observations and expertise. (For example, see list of members - 11 person working group (

The reality is that not every work group’s proposed rulemaking topic will have the potential to affect your business. If, however, a work group is considering new rulemaking that may affect your business, it is the most important time and place for you to be involved. In many states, you would have to fight to be involved this early in the rulemaking process. MED has not only given you the right to participate, they invite you to become involved.

A working group provides a forum where input from knowledgeable people involved in the cannabis industry will be most effective.

Final language will not have been drafted, opponents will have to openly defend their positions in face-to-face conversations with industry experts and MED staff, disputes and conflicts will be identified and, if possible, resolved in favor of your business interests before the next step in the process – drafting the actual language for official publication of the rule for public comment.

Typically, the proposed rules are published and members of the public are encouraged to makes comments, express concerns and opposition views regarding the language of the proposed rule. Written comments and oral testimony at a public hearing are solicited – both pro and con. In Colorado’s system, there is a Hearing Officer who reviews the public comments and makes a recommendation to the Department of Revenue official (State Licensing Official) who then adopts the rules as proposed, adopts rules with modifications or sends the rules back to MED staff for additional work.

MED’s commitment to using working groups is more than lip service. As noted above, a quick review of some recent working groups’ agenda items illustrate the breadth of involvement sought by MED.

Continued next week with: Additional Regulatory Concerns (Federal)

Topics: Analysis, Investing, Legal