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Denver |
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Code of Ordinances |
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Chapter 6. ALCOHOL BEVERAGES AND RETAIL MARIJUANA |
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Article V. DENVER RETAIL MARIJUANA CODE |
§ 6-203. City-wide cap on certain retail marijuana licenses; annual open application process.
(a)
Effective May 1, 2016, the issuance of any new retail marijuana store license or any new retail marijuana cultivation facility licenses in the city shall be subject to the cap on marijuana sales locations and the cap on marijuana cultivation locations respectively as well as the cumulative cap on marijuana cultivation and sales locations, to be administered by the director in accordance with this section.
(b)
The director shall calculate and publish the cap on marijuana sales locations, the cap on marijuana cultivation locations, and the cumulative cap on marijuana cultivation and sales locations as soon as possible after a determination is made by the director on all applications for new licenses that were pending on May 1, 2016. The director's calculation of the caps shall be considered dispositive and shall not be subject to appeal.
(c)
Beginning in 2017 and continuing once in each calendar year thereafter, the director shall administer an open application process for new retail store licenses and new retail marijuana cultivation facility licenses, to the extent the total number of then-current licensed locations in either category in the city falls below the cap on marijuana sales locations and the cap on marijuana cultivation locations respectively, and only if the cumulative number of then-current licensed locations for any combination of marijuana cultivation or sales licenses falls below the cumulative cap on marijuana cultivation and sales locations. The annual open application process shall be subject to the following requirements:
(1)
In advance of the open application process, the director shall determine and publish the total number of available locations in the city for retail marijuana stores and retail marijuana cultivation facilities under the respective caps. The director's determination of the number of available locations shall be considered dispositive and not be subject to appeal. To the extent the director determines any capacity for licensing of up to thirty (30) available locations falling below the cap on marijuana cultivation locations, the director is authorized to issue new cultivation licenses in accordance with the procedures set forth in this section in a number not to exceed one-half of the number of cultivation locations falling below the cap, which shall be deemed the "number of available locations" for cultivation licensing as that term is used in this section. To the extent the director determines capacity for licensing in excess of thirty (30) available locations falling below the cap on marijuana cultivation locations, the director is authorized to issue new cultivation licenses in a number equal to the number of available locations in excess of thirty (30) falling below the cap.
(2)
Eligibility for licensing under the annual open application process shall be determined by a blind lottery. Prior to the blind lottery, the director shall prequalify persons wishing to enter the lottery in accordance with the following requirements:
a.
The entrant shall submit proof of prior approval by the state licensing authority for the retail marijuana establishment in question, to the extent required by state law.
b.
The entrant shall submit a complete application for local licensing in accordance with the requirements of this article V along with all applicable fees, which shall be subject to refund if the entrant is not selected in the blind lottery.
c.
The entrant shall submit proof that the entrant has or will have lawful possession of the premises proposed for the marijuana establishment, which proof may consist of: a deed, a lease, a real estate contract contingent upon successful licensing, or a letter of intent by the owner of the premises indicating an intent to lease the premises to the entrant contingent upon successful licensing.
d.
The location proposed for licensing by the entrant shall comply with all applicable city zoning laws and the location restrictions set forth in this article V.
e.
The entrant shall submit, to the satisfaction of the director, proof of financial capability to open and operate the retail marijuana establishment for which the entrant is seeking to apply. Standards for proof of financial capability shall be determined by the director and adopted by rule or regulation.
f.
In addition to complying with any other state or city requirement related to good character and criminal background, any person proposed to have an ownership interest in the license shall not have committed in the preceding year any marijuana licensing violation affecting public safety, as defined in the rules and regulations of the state licensing authority, or received any suspension or revocation of any other state or local marijuana business license in the preceding year.
g.
The entrant and the application otherwise complies with any and all qualification standards set forth in state and city laws or regulations.
(3)
A separate lottery drawing shall occur for entrants seeking to apply for retail marijuana store licenses and retail marijuana cultivation facility licenses. The director shall conduct the lottery drawings in a public setting, with all entrants in the lottery advised of the date and time of the lottery in advance and afforded the opportunity to attend and witness the drawing. The names of all entrants in each lottery shall be drawn and assigned a number in the order they are drawn from first to last. The entrants who are first drawn in a number equal to the number of available locations under the cap on marijuana sales locations or the cap on marijuana cultivation locations shall be afforded first opportunity to proceed with the licensing process. If any of these entrants fail to pursue licensing, or if the director denies the entrant's application, then other entrants in the lottery, based on the order in which their name was selected, will be afforded the opportunity to proceed with the licensing process. In no event shall an entrant or applicant be allowed to transfer the application to any other person during the annual open application process.
(4)
Selection of an entrant in the lottery shall not be construed to create any right or entitlement to ultimate license approval by the city, and entrants selected in the lottery shall remain subject to all other requirements of this article V before a license may be approved including, by way of example, the public hearing requirements set forth in section 6-212 for retail marijuana stores.
(5)
The director may adopt additional rules and regulations governing the annual open application process.
(6)
Prior to the first annual open application process administered by the director under this section, the director shall determine the number of licensed locations where medical marijuana centers, retail marijuana stores, or both, exist in each statistical neighborhood of the city. Likewise, the director shall determine the number of licensed locations where medical marijuana optional premises cultivation facilities, retail marijuana cultivation facilities, or both, exist in each statistical neighborhood of the city. The director shall then identify the five (5) statistical neighborhoods where the highest number of licensed marijuana sales locations exist, and the five (5) statistical neighborhoods where the highest number of licensed marijuana cultivation locations exist. The statistical neighborhoods thus identified by the director shall be considered neighborhoods of undue concentration of marijuana business licensing, and shall be prohibited from further licensing as a part of the annual open application process for the year in question. To the extent there is a tie in the number of licensed locations among two (2) or more statistical neighborhoods with the fifth most licensed locations, then all such neighborhoods shall be treated as neighborhoods of undue licensing and shall be prohibited from further licensing as part of the annual open application process. Entry into the lottery for a retail marijuana store license shall be denied for any applicant proposing to locate a retail marijuana store in any statistical neighborhood determined by the director to be a neighborhood of undue concentration based upon the current number of locations of medical marijuana centers retail marijuana stores or both in the statistical neighborhood. Entry into the lottery for a retail marijuana cultivation facility license shall be denied for any applicant proposing to locate a retail marijuana cultivation facility in any statistical neighborhood determined by the director to be a neighborhood of undue concentration based upon the current number of locations of medical marijuana optional premises cultivation facilities, retail marijuana cultivation facilities, or both, in the statistical neighborhood. Upon the completion of the first annual open application process, the director shall report to the council regarding the implementation of this subsection, along with a recommendation about whether or not to continue to restrict licensing in identified statistical neighborhoods in future open application processes.
(Ord. No. 291-16, § 2, 4-25-16)