Every January since 2012, a report has been submitted from the Colorado Revenue Department to the chief clerk of the state’s House of Representatives and with the Secretary of the Senate. These reports include information about medical marijuana license violations, suspensions, revocations, and fines that the state collected throughout the previous year.
Cannabiz Media reviewed all of the available reports to identify what’s been happening in Colorado over the past few years. Here are some of the most interesting pieces of data and our key findings.
Colorado Medical Marijuana Fines and Violations: 2012 to 2015
Making a mistake (whether it’s intentional or unintentional) can cost a medical marijuana licensee a lot of money in Colorado. In 2012, the state reported 21 violations but no fines collected. One year later, the state collected $27,000 in fines from 17 violations. A pattern had begun.
Jump to 2014, and the State of Colorado collected $413,500 in medical marijuana license fines with $28,500 (7%) of that money coming from retailers. In total, the state suspended 34 licenses during the year and revoked 3 licenses.
In 2014, some local governments began tracking and reporting violations and fines, too. Boulder collected $25,000 in fines for 14 violations. Three other cities reported violations but no fines: two violations for Carbondale, 14 violations for Colorado Springs, and two violations for Eagle County.
In 2015, the number of fines and violations continued to grow. The total fines collected by the state increased to $737,650 with nearly one-third (32%) of that money ($234,000) coming from retailers. While there were fewer license suspensions in 2015 than in 2014 (31), there were significantly more license revocations in 2015 (38).
Boulder is the only city included in the State of Colorado report for 2015. According to the reported data, the city collected more than twice as much money in fines ($53,750) during 2015 but revoked fewer licenses (four).
What We Can Learn from the Data?
The data shows that licensed medical marijuana fines and violations are on the rise as the industry grows. Take a look at the graph below to see just how much!
Between 2014 and 2015, state fines grew by 78%. The increase in retailer fines grew even more. In fact, the increase in retailer fines during that time was staggering at 721%! Similarly, local medical marijuana licenses are paying more in city fines. Medical marijuana license fines collected in Boulder, Colorado increased by 115% between 2014 and 2015.
And it’s not just fines that are increasing. License suspensions and revocations are on the rise, too. In 2014, the State of Colorado issued 34 license suspensions. While that number decreased by 9% in 2015, the number of license revocations skyrocketed by 1,116% in 2015 (from 3 to 38).
It’s important to point out that the data shows there is no single point of failure for medical marijuana licensees. The State of Colorado imposes violations and collects fines from individuals (owners and employees), cultivators, retailers/dispensaries, and manufacturers.
In other words, no one can claim impunity. While the Colorado marijuana economy is progressive, you have to play by the rules if you want to operate in it without getting into big, expensive trouble (or getting kicked out entirely).
Susan Gunelius, Lead Analyst for Cannabiz Media and author of Marijuana Licensing Reference Guide: 2017 Edition, is also President & CEO of KeySplash Creative, Inc., a marketing communications company offering, copywriting, content marketing, email marketing, social media marketing, and strategic branding services. She spent the first half of her 25-year career directing marketing programs for AT&T and HSBC. Today, her clients include household brands like Citigroup, Cox Communications, Intuit, and more as well as small businesses around the world. Susan has written 11 marketing-related books, including the highly popular Content Marketing for Dummies, 30-Minute Social Media Marketing, Kick-ass Copywriting in 10 Easy Steps, The Ultimate Guide to Email Marketing, and she is a popular marketing and branding keynote speaker. She is also a Certified Career Coach and Founder and Editor in Chief of Women on Business, an award-winning blog for business women. Susan holds a B.S. in marketing and an M.B.A in management and strategy.