The Marijuana Industry Group (MIG), a cornerstone of Colorado’s cannabis scene since its founding in 2010, is closing its doors. This shift marks a turning point as Colorado Leads steps forward to champion cannabis industry reforms.
With the legislative session in full swing, stakeholders are looking to refine regulations, reduce costs, and sustain the industry’s viability amid declining revenues and employment.
Colorado Leads Takes the Baton
MIG, initially set to merge with Colorado Leads, opted to cease operations instead, entrusting its mission to the latter. In an email to MIG members, Board Chair Bruce Nassau emphasized the importance of continued advocacy through Colorado Leads.
Chuck Smith, CEO of Colorado Leads and a veteran of the cannabis industry, outlined the organization’s priorities, which include updating regulatory frameworks and promoting cost-effective measures. Colorado Leads aims to fill the advocacy void left by MIG while maintaining the industry’s compliance and safety standards.
“We’re looking to create a balanced approach,” Smith said, “one that ensures public safety without unnecessary regulatory burdens.”
Legislative Focus: Streamlining Regulations and Taxes
Colorado Leads has identified key legislative goals to address industry challenges. One focus is reducing costs through measures introduced under Senate Bill 24-706, also known as Regulatory Efficiency 1.0, which took effect in August 2024. This law simplified processes for license renewals, tracking technology, and multi-license applications.
Key changes from SB 24-706 include:
- Eliminating the mandatory use of radio frequency identification (RFID) for marijuana tracking.
- Extending license renewal periods from one year to two years.
- Allowing single applications for businesses with multiple licenses.
Building on these changes, Regulatory Efficiency 2.0 aims to further ease the cost of regulation for both businesses and the state’s Marijuana Enforcement Division. Smith highlighted the importance of a collaborative approach to ensure these updates don’t compromise safety standards.
“We know how tight budgets are in Colorado,” Smith said, “but we believe these changes can streamline processes and cut costs for everyone involved.”
Tackling Excise Taxes: A Critical Step for Sustainability
One of the most contentious issues Colorado Leads is addressing is the 15% excise tax on cannabis sales. Mason Tvert, a consultant for Colorado Leads and a key advocate for the state’s original legalization measure, explained that the tax structure has grown disproportionate to what voters initially approved.
“When Amendment 64 passed, it was meant to include only an excise tax,” Tvert noted. “Over time, additional taxes were introduced, making the burden unsustainable for businesses.”
Colorado Leads plans to push for tax reductions to align with the industry’s economic realities. Lowering these rates could help cannabis businesses remain competitive and viable in a saturated market.
Addressing Inefficiencies in Industry Rules
Former state representative Dan Pabon, now general counsel for cannabis operator Schwazze and a Colorado Leads board member, underscored the need to evaluate existing regulations. He pointed out that some rules, while well-intentioned, create unnecessary financial strain without enhancing public safety.
For instance:
- Cannabis businesses must maintain extensive records far longer than other industries.
- Mandatory security measures like full-coverage cameras are not required in comparable sectors such as liquor retail.
- Workers in the marijuana industry must pay for badges, a requirement absent in similar industries.
“If we’re going to maintain Colorado’s position as a leader in cannabis, we need to eliminate inefficiencies that don’t serve public interest,” Pabon said.
Colorado’s Pioneering Role and the Road Ahead
For over a decade, Colorado’s cannabis framework has served as a model for states entering the legal market. However, declining revenues and increasing competition highlight the need for updates to remain at the forefront.
As Colorado Leads takes charge, the organization seeks to balance economic growth, safety, and accessibility. By addressing taxation, regulatory inefficiencies, and evolving industry needs, it hopes to restore stability and foster innovation.
“This is a pivotal moment for Colorado,” Smith remarked. “The decisions we make now will determine whether we remain a trailblazer or lose our edge to other states.”