Tuesday, February 18, 2014

How does Colorado's marijuana market work?

The 64th Amendment, the measure of which was approved by the 55% voters in 2012, laid certain parameters for Colorado’s marijuana regime. These parameters included maximum tax rates along with the rights of many cities and countries to exclude these pot shops from their jurisdictions. Unlike many other states, the system of medical marijuana in Colorado is very well regulated. So, the question arises, how does this market operate? Are there still any barriers to it’s working and so on.
Marijuana Regulation in Colorado
Until October, 2014, only licensed medical outlets that were maintained in good standing condition are allowed to serve recreational customers. This is one main reason that many shops that opened in January have names such as Citi-Med, Medicine Man, etc. The vertical integration system of Colorado, according to which retailers are supposed to plant majority of the substance they sell. This further makes monitoring much easier for the state.

Major Challenges Faced by Marijuana Collectives and Retailers
The current market faces major challenge of setting the correct price for the product. As analyst Mark Kleiman states, the “Goldilocks point”- if one quotes a low price of the product, they are indirectly encouraging excessive consumption of the product, plus the chances of out-of-state exports are also higher. And, if you are quoting a high price for the product, then perhaps you are giving space to illicit marijuana dealers.
Guidelines for Marijuana Use in Colorado
The use of marijuana for medical purposes is only allowed for those who are aged 21 and above. They can legally buy or possess and make use of marijuana in the state of Colorado. However, they can consume the product only in private property, that too with the consent of the property owner. They are definitely not allowed to transfer it, under any given circumstance across any state lines. Residents are allowed to buy about an ounce of marijuana at one time and out-of-state people are allowed to buy about a quarter-ounce. Local residents can also grow maximum of 6 plants of the product at home and give away (not sell) the proceeds.
What’s the Overall Prevailing Situation
Though implementing the guidelines set will be pretty hard, officials of Colorado are required to work extensively in order to satisfy the Federal government laws. The use of Marijuana remains illegal according to the 1970 Controlled Substances Act and as such the feds have been very keen to crack down few marijuana operations in the recent years.
In August, the deputy Attorney General also issued a memo stating that the Federal Government is open to allow any experiments in the state of Colorado and also Washington only till the time these experiments do not impede the eight “enforcement priorities”, which prohibits illegal distribution of marijuana to minors; and even to the other states.

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