Pot businesses thrive under Colorado's tough rules

Credit: KING 5 News

Medical marijuana businesses advertise openly in Colorado.

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by JOE FRYER / KING 5 News

kgw.com

Posted on November 20, 2012 at 8:32 AM

DENVER -- Of all the bakeries in Denver, Lexi Yurkovsky never expected to end up at Dixie Elixirs and Edibles after earning her Bachelors’ degree in culinary nutrition. 

“Definitely not,” she said with a laugh. “I thought I’d be working in a restaurant or something like that.”

She now makes Tootsie-Roll-like treats that feature an unlikely herb: medical marijuana.

“It’s not too far from just cooking,” Yurkovsky said. "It’s more just infusing the product we have.”

Her company makes a variety of cannabis-laced edibles, bath salts, drinks and more. The company credits much of its success to location.

“Colorado is absolutely the place to be right now,” said Dixie’s Christie Lunsford.

State oversight of medical marijuana began about three years ago, and many in Colorado believe those regulations put the state in a better position to regulate recreational marijuana, which was just approved by voters here (Washington voters approved a similar measure this month as well).

Before Colorado regulators got involved, there were about 1,100 unregulated medical-marijuana businesses in Colorado.

One business, Ganja Gourmet, even operated a restaurant that served medicated pizzas and other items. But the city of Denver quickly banned on-site consumption of medical marijuana, and state oversight soon followed. Today, Ganja sells buds and many cannabis-infused edibles. 

Former narcotics officer Matt Cook helped write the state’s laws, which force growers to document every plant from seed to sale. Each plant is registered to a patient and has a bar code. 

“And everything -– 100 percent of what happens through the life of this process –- is on video,” Cook pointed out. 

From cameras to electricity bills to heating and cooling, the high cost of getting into the business weeds out a lot of businesses, especially because banks will not finance places that violate federal law. 

“You’re coming in with your own money,” said Kayvan Khalatbari, co-owner of Denver Relief. “You’re looking at $500,000 to $1 million investment to get one of these shops going now.”

Like all Colorado dispensaries, Denver Relief is required to grow at least 70 percent of what it sells, putting more emphasis on quality. Khalatbari’s strains even won Colorado’s prestigious Harvest Cup.

“It becomes about competition, it becomes about free market,” he said. “It’s not just like the underground market where you get what you get. That’s not medicine.”

Colorado is now home to more than 500 dispensaries, of which about 200 are in Denver. The green crosses that have become a symbol for medical-marijuana businesses in Colorado light up South Broadway, which has earned the nickname “Broadsterdam,” a reference to the pot-friendly Dutch city of Amsterdam.

Many feel the state’s system is a good foundation for recreational marijuana, but many dispensaries do not plan to jump in. 

“We’re going to choose to stay medical because we do have 400, 500 patients that rely on what we do here and we don’t want to put ourselves at risk and their medicine supply at risk,” Khalatbari said. 

However, Denver Relief and other dispensaries do plan to serve as consultants for dispensaries in other states.

Meanwhile, Dixie Elixirs and Edibles sees an opening. 

“Could we now see you guys in Washington state?” we asked.

“Yes, absolutely,” answered Lunsford.

Which means more trained culinary workers could end up like Lexi Yurkovsky -- jumping into a job they never saw coming.  

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