A Boulder councilman thinks the city should consider putting a cap on the number of medical marijuana cultivation centers that it allows.

“There’s only so many sick people to use these services,” George Karakehian told his colleagues at a City Council meeting this month. “Maybe what we should be looking at is some top end.”

Karakehian said he’s asked the city’s staff to explore whether the council could limit the number of growing operations. He argues that Boulder isn’t necessarily getting any financial benefits from the 60 known cultivation centers that have set up shop in the city.

“When people from Fort Collins are having their grow operation in the city of Boulder, we get no sales tax for that,” he said.

That’s because sales tax collected on marijuana grown in Boulder but sold elsewhere goes to the city where the product is sold, according to Boulder spokeswoman Sarah Huntley.

City staffers recently told the council that many dispensaries and growing centers also aren’t properly remitting use taxes on their equipment, which officials suspect is because most owners don’t know what’s taxable.

“We aren’t getting any other taxes for it either,” Karakehian said. “As a city, what did that additional grow center get us?”

The city’s finance department plans to begin an educational campaign about the use taxes, as well as audits that will target marijuana businesses, officials said.

Supplying the state?

In late 2009, the Boulder council briefly considered a moratorium on the opening of additional medical marijuana dispensaries as the city hashed out permanent rules for the budding industry. But the leaders never went that route, and did not incorporate a limit on the number of marijuana-based businesses or growing operations when they approved a final ordinance last May.

While Colorado’s rules for medical marijuana dispensaries require them to grow at least 70 percent of the product that it sells, city records show that Boulder has at least 15 more growing warehouses than legal dispensaries.

Karakehian said that could point to a growing problem.

“Is enough, enough?” he said. “Should we be supplying marijuana for the whole state? Somehow, that doesn’t feel like what I thought we were going to do here.”

He said Boulder’s rules that prevent dispensaries from clustering in retail locations could end up limiting the number of allowed dispensaries. But he said there’s still plenty of room for cultivation centers to be added in industrial areas of the city.

The city on Dec. 29 accidentally published a map showing the locations of cultivation centers in Boulder, which state law requires cities to keep secret. The map, which has since been removed from the city’s Web site, shows clusters of cultivation centers in Gunbarrel, and in north Boulder along Broadway and Lee Hill Drive. But the highest concentration of growing operations is in east Boulder, near Arapahoe Avenue and 55th Street, and along Foothills Parkway near Pearl Parkway.

Karakehian said he expects staffers to deliver a report to the council on the options for limiting cultivation centers.

“I’m expecting some more discussion about it,” he said.

Market effects

Joe Cohen, a Boulder physician who runs the holistic wellness center Holos Health, at 3000 Center Green Drive, prescribes marijuana for many of his patients.

He said the city should not limit local production of the drug.

“I think that would probably sort itself out though the competition that’s out there,” he said.

He said his practice is working to “legitimize the industry” by referring patients to dispensaries that are “doing the right thing” by focusing on medication instead of recreational use of marijuana.

“We have a pretty good idea who’s catering to a certain population,” he said.

Cohen said he sees a large number of patients who use the drug to treat pain and sleep issues.

“Marijuana has very few harmful effects,” he said.

Kelly Moore, owner of the Flower of Life Healing Arts dispensary at 3970 Broadway in Boulder, has a growing site within city limits.

She questioned whether the city should consider limiting growing operations.

“I don’t know what the city has to gain,” she said.

She said that, while there may be tax issues, grow sites still have to pay the city $5,000 each for a business license.

“The money that’s going to the city from those grow facilities is definitely helping,” Moore said.

Contact Camera staff writer Heath Urie at 303-473-1328, or urieh@dailycamera.com.