August 8, 2022

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Once marijuana dispensaries officially open in Grand Junction, it could light a spark for the...

Once marijuana dispensaries officially open in Grand Junction, it could light a spark for the city’s economy — while having a blunt impact on the revenue of western Colorado’s communities that have been profiting from pot shops for years.

Next week, the Grand Junction City Council is expected to consider a draft ordinance on retail marijuana. The ordinance will include criteria for handing out 10 licenses for recreational marijuana using a merit-based approach. As the biggest city on the Western Slope, Grand Junction has long been seen as a potential gold mine for dispensaries.

Companies hopeful that they’ll be given one of the 10 licenses have already begun scouting locations. Sid Squirrel, a broker associate with Bray Real Estate, said there has “definitely” been interest in locations for future dispensaries all over town.

Squirrel believes dispensaries will have a “two-fold” impact on the city’s commercial sales and commercial leasing.

“One, there’s going to be 10 dispensaries, and those locations will either be leased or sold, so that will take retail locations off the market that have been sitting idle, so that’s a good thing which will increase the occupancy level of retail spaces in the valley,” Squirrel said. “The second thing is, when they do determine and select the licensees, there’s going to be a bunch of locations that were being tied up by groups that didn’t get selected and they’re going back on the market.”

While the zoning of dispensaries is still to be decided by City Council, the Horizon Drive District is planning to have a maximum of two dispensaries on North Horizon Drive near Interstate 70, according to Vara Kusal, the executive director of the Horizon Drive Association Business Improvement District.

“We have actually heard from several property owners who have been inundated with requests to sell their property or lease properties,” Kusal said, adding that some business owners have been called daily about their property.

“There’s a lot of interest from other businesses because of our location right off of I-70. They seem excited about the draw, more people coming in. Hopefully, they will patronize restaurants, and more business for hotels is always nice.”

SIGNAGE IS A CONCERN

The one caveat to having dispensaries close to the interstate, Kusal said, is that the Horizon Drive Association Business Improvement District doesn’t want these businesses erecting large signs advertising themselves.

She feels that people will be able to find the shops easily without giant, neon-green pot leaves lighting up the night sky.

“We are repeatedly requesting that we would like to see some limitations on signage,” Kusal said. “We’re hoping to not have the kind of big, bold signage you see in other areas. We think that these stores can be found without needing those large, garish types of signs. We are repeatedly asking City Council to consider these limitations. Palisade has limitations on the signage, and I think that’s a really good idea.”

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According to Brandon Stam, executive director of the Grand Junction Downtown Development Authority, while nothing is official, it’s likely that the downtown area will feature at least one dispensary, but marijuana businesses will not be allowed on Main Street, or at the least, they won’t be on the ground floor of Main Street.

POTENTIAL LICENSEES

Among businesses hopeful they’ll be entering the Grand Junction market is The Green Joint, based in Glenwood Springs with additional shops in Parachute and Rifle.

Green Joint Owner Dan Sullivan has been an active participant in council meetings on the topic of dispensaries. Sullivan was pleased by the City Council’s decision in January to move toward a merit-based approach for granting licenses.

Sullivan is confident The Green Joint will be among Grand Junction’s dispensaries, citing the ties the company already has to the Western Slope. He said the company has for years employed Grand Junction residents who drive to Parachute or Rifle each day, so a Grand Junction location would reward those employees as much as its customers.

“It’s the largest community on the Western Slope, so the opportunity is significant,” Sullivan said. “We have a lot of loyal customers that drive from Grand Junction to our other locations, particularly Parachute, so the convenience factor there will be great for a lot of folks.

“It’s a potential future crown jewel, so to speak.”

The Happy Camper Cannabis Co., based in Bailey in the mountains southwest of Denver, has a popular location in Palisade and a total of 48 dispensaries around the state, could also expand into Grand Junction.

The Palisade dispensary is already on the move, with plans to relocate from River Road to behind the Golden Gate gas station off Exit 42 of I-70. This move will lead to less congested traffic along River Road and also provide easier access to both loyal customers and drivers passing through the Grand Valley.

Colleen Scanlon-Maynard, one of the three owners of The Happy Camper, said the business isn’t “afraid of competition” should it not receive a license for a Grand Junction location, but she’s optimistic.

“We have a very prosperous, good, strong business. We’re well-respected across the state. I think If they’re going by merit, we would certainly get in,” Scanlon-Maynard said. “I would think we would get in, but if we don’t, it’s business. Businesses can’t worry about other businesses. You do your business the best you can do your business, and the customers will come.

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“The ones that choose not to come, that’s OK.”

Owners of The Weedery, Palisade’s second dispensary, declined to comment for this story but had recently tried to move into a larger venue.

Weedery owner Jesse Loughman had wanted to purchase and open a location in the former Grande River Winery near I-70, but his bid was rejected by town trustees.

The trustees rejected the request that would have allowed him to move operations during a March 2021 meeting, saying that a marijuana sales outlet in that location would adversely affect the aesthetic and character of a key entrance to the town.

Representatives of Wine County Inn were outspoken in their opposition to the proposed move. Grande River Winery, which was first licensed in 1987, was then purchased by the Wine Country Inn owners in a June deal.

The trustees later approved the relocation plan of The Happy Camper to its location behind the Golden Gate convenience store and gas station near I-70 in August. The board justified the decision by saying that the location more east of the Exit 42 area was better suited to business development since it accommodated similar uses.

Those who stay in Grand Junction instead of continuing to frequent Palisade, De Beque or Garfield County for their weed needs could lead to a downturn in sales for those other locations and, therefore, a subsequent downturn in tax revenue for those small towns.

The Happy Camper and Colorado Weedery are not only Palisade’s only two dispensaries, but they’ve long been the only places for valley residents to legally buy marijuana without venturing through De Beque Canyon.

For Palisade Mayor Greg Mikolai, a “definite impact” on revenue is inevitable. The uncertainty stems from how large that impact will ultimately be.

“Will our revenues cut in half? Is it only going to be a percentage, like 10% or 25%? We don’t really have a good indication or good idea yet what that could be,” he said. “Part of that is going to be contingent on where the dispensaries are located, to be perfectly honest. If they’re primarily on the western side of the city, we may not see as much of an impact as if they were far more dispersed.

“Also, it may depend on how many there are by the time. We do know there will be an impact. There has to be. On the other hand, our crystal ball just isn’t as clear on that as we’d like it to be.”

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Mikolai discussed some of Palisade’s options to mitigate the impact. For one, Palisade’s ordinances require a maximum of three dispensaries in the town.

He said there have been “issues” as far as a third dispensary opening, but the town is “cleaning up” its ordinances to make the process to open a third marijuana store clearer.

He also mentioned that the town considered raising its sales tax from 2% to be more in line with the rest of the valley, but because of inflation and other concerns, he believed it would not be prudent for the town to approach it as a ballot issue at this time.

“There really isn’t any other plan in place concerning Grand Junction’s impact on our retail revenue other than watching it closely over the next year and watching our spending and being prudent about where our money is going to go over the next fiscal year and maybe even into the next fiscal year,” Mikolai said. “We are fortunate to have an extremely decent reserve at this point, so I don’t think we’ll really start feeling any huge pinch until, maybe, well toward the end of 2023.”

The only other town in Mesa County with dispensaries is De Beque. The town has four dispensaries: Elk Mountain Trading Post, Kush Gardens, Tumbleweed and Buds Premium Cannabis.

De Beque Town Administrator Caré McInnis said the impending expansion of dispensaries into Grand Junction is on the town’s radar.

McInnis noted that dispensaries are not the only facet of the marijuana industry in town. There are two cannabis cultivators there: Hava Gardens and the soon-to-open Flower Collective. She believes those growers will help maintain De Beque as one of the Western Slope’s most prominent sources for marijuana.

No matter what impact Grand Junction dispensaries have, however, McInnis believes the cannabis industry provides more to De Beque than just money, and that bond will continue to be strong no matter what Mesa County’s largest city does.

“The industry certainly brings a lot of benefits to the town outside of just their tax dollars,” she said. “They’ve been beneficial in a number of ways. There’s the jobs they bring to our community, and they’re significant contributors to our community, in terms of services and contributions and such.

“We value them more than just their tax dollars.”

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