Denver Launches Crackdown on Unlicensed Cannabis Consumption Lounges

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Affected operators said the licenses are expensive and the rules unclear.

Denver city officials began sending warning letters and issued at least one ticket for a civil violation to hospitality companies in city limits that have been allegedly hosting marijuana consumption events.

The letters, which started going out in June after the city received complaints about marijuana use at each location, urged the eight business recipients to apply for a city license to hold cannabis consumption events, The Denver Post reported.

“After a serious of complaints, Denver took enforcement action against unlicensed hospitality businesses in Denver last weekend,” Eric Escudero, spokesman for the Denver Department of Excise and Licensing, confirmed in an email to Green Market Report. He added that enforcement is “always a last resort.”

Those who received warning letters include:

  • Art gallery Ant Life
  • Metra Talent Group
  • The Marijuana Mansion
  • The Psychedelic Club of Denver
  • NORML Denver
  • The Vape Loft
  • Rooted Heart Yoga Studio
  • Clubhouse Collective

A ninth, the Tetra Lounge, received a general violation ticket for operating an unlicensed consumption lounge, The Post reported.

Jacob Lemanski, owner of Ant Life, told The Post that the venue had allowed private cannabis consumption during events, but that it’s not operating as a consumption lounge per se.

“The hoops you have to jump through, and the costs of getting up and running as a cannabis lounge, is just prohibitive,” Lemanski said. “I don’t think a business owner could see making their money back in that situation. It’s too hard to do.”

Nikki Hazamy, owner of the Rooted Heart Yoga Studio, told The Post she didn’t realize her business was violating any laws by allowing occasional marijuana use during private yoga sessions until she got the warning letter.

“It’s very vague – what you can and can’t do with cannabis,” Hazamy said of city marijuana consumption rules. She added that obtaining a consumption license costs “thousands” to obtain, and isn’t necessarily a good return on investment.

Other companies targeted by the crackdown declined to comment to The Post.

“Citations, fines, and enforcement activity by the City and County of Denver are always a last resort after every effort has been made to educate businesses about licensing rules and regulations,” Escudero told The Post. “If a marijuana business is conducting commerce, there is a requirement for licensing.”

According to the city website, there are currently five licensed marijuana hospitality businesses, but Escudero said there’s only one that’s operational: the Coffee Joint. The other four have yet to pass code and building inspections, he told Green Market Report. One of the licensees that has yet to pass inspection is the Tetra Lounge, which received the recent ticket.

There are also three licensed mobile marijuana hospitality companies, Escudero added.

Those permits allow the so-called cannabis party buses “to park at a location for 30 minutes at a time or drive around with consumers allowed to consume as part of Denver tours, events, weddings, etc.,” Escudero wrote. “So some of the businesses that received notice of violation orders from the city such as a yoga studio, painting class or just about any other event could hold their event with consumption outside in a licensed marijuana mobile hospitality establishment.”

Only qualified social equity applicants are eligible for most new Denver municipal cannabis business licenses, including hospitality permits, until July 2027, Escudero wrote.

John Schroyer

John Schroyer has been a reporter since 2006, initially with a focus on politics, and covered the 2012 Colorado campaign to legalize marijuana. He has written about the cannabis industry specifically since 2014, after being on hand for the first-ever legal cannabis sales on New Year’s Day that year in Denver. John has covered subsequent marijuana market launches in California and Illinois, has written about every aspect of the marijuana trade, and was part of the team that built the cannabis industry’s first-ever trade show, MJBizCon. He joined Green Market Report in 2022.


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