A Denver business that hoped to open the nation’s first legal marijuana spa has come up short — by about 20 feet.

The city’s licensing director Wednesday denied a license application filed by Utopia All Natural Wellness Spa and Lounge to allow marijuana consumption in an old Capitol Hill mansion, citing its location 980 feet from a child-care center. City regulations for the voter-approved social marijuana use ordinance require businesses that seek consumption-area licenses to be at least 1,000 feet from day cares.

Had it been approved, Utopia would have received the second license issued under Initiative 300, which was passed by 54 percent of Denver voters in 2016.

Utopia founder and CEO Cindy Sovine had appealed to Denver licensing officials for leniency and submitted a letter from the child-care center supporting a waiver of the proximity restriction, but the city’s decision says it lacks that authority.

“I have almost a year and a half invested into this property, from the time I first started thinking about it and working on it,” Sovine said. “I’m definitely not ready to let it go.”

She questioned the city’s inflexibility, noting that her plan had support from the landlord, neighborhood groups and even the child-care center, adding: “I think this is a perfect example of why I-300 is not being implemented successfully.”

As she considers her options, Sovine could appeal Wednesday’s license denial to a city hearing officer. Ashley Kilroy, the executive director of the Denver Department of Excise and Licenses, suggested Sovine also could abandon plans to occupy the Creswell Mansion, at 1244 Grant St., and seek a new property for Utopia.

In February, The Coffee Joint in La Alma/Lincoln Park won approval for the city’s first license for a 21-and-over, bring-your-own marijuana consumption club. It’s next door to a dispensary with shared ownership.

Not many other applications have come in. Some cannabis-minded entrepreneurs have run into difficulty finding properties that are outside buffers surrounding schools and child-care centers and also in areas where local neighborhood groups will support their plans, as required under the initiative.

Sovine has set out plans at Utopia for cannabis-infused massages, ganja yoga, spiritual counseling and other services during the day. She also planned to have indoor and outdoor marijuana-consumption areas in the afternoon and evening for members and to make the facility available for weed-friendly events.

“The whole idea is to create social opportunities to bring people together,” Sovine told The Denver Post this year.

She said her plans for the spa were rooted in her exploration of the therapeutic potential of marijuana since her father battled lymphatic cancer. She also hoped to create a social setting friendly to medical marijuana patients.

But ultimately, the city’s mapping software determined that the Creswell Mansion was too close to Third Way Center, a day care at 1133 Lincoln St., about three blocks away. Third Way serves at-risk and disadvantaged youths and their families.

“If our businesses don’t meet proximity requirements, we deny them,” Kilroy said. “It would be unfair to treat her any differently.”

Utopia’s application drew support from five neighborhood organizations, but it had not yet faced a public license hearing. Besides its proximity to the day care, Kilroy said, the business still had not worked out issues that included obtaining a proper zoning-use permit for the building and submitting sufficient odor-control plans.

Kilroy said she weighed the proximity issue first, and carefully. She has some leeway on location restrictions, she said, such as when a part of the building that’s not used for the business juts out too far, causing the business to fail a distance test.

Should the city exercise more discretion?

But in this case, Kilroy said, Utopia acknowledged the building was a little too close to the day care. Kilroy cited recurring instances in which the city denies liquor licenses because a proposed store is too close to another liquor store and rejects event-based liquor license requests if they’re filed past the deadline.

“I’ve talked to city attorneys, and I don’t really have any discretion in this area,” Kilroy said.

The Denver City Council recently created a Social Consumption Area Task Force to review the ordinance. Some members have urged the panel to probe why so few licenses have been sought or granted so far, and the June 14 meeting will focus on the distance requirements, said Councilwoman Kendra Black, the task force’s chair.

On Wednesday, she weighed in on the Utopia denial: “I believe it is within the discretion of the (licensing) director to grant an exception in a case like Utopia, when the day care is in support.”

Critics of the city’s distance rules point out that they close off much of the city to social consumption licenses.

The voter initiative itself imposes a 1,000-foot buffer between schools and licensed businesses with marijuana-consumption areas. Last year, after a committee weighed additional rules and regulations, Kilroy adopted similar buffers for child-care centers, as well as alcohol and drug treatment centers.

Those proximity restrictions drew protests from the initiative’s original backers, who contended they limited the potential locations for licensees too much. But Kilroy argued those buffers were reasonable because they mirrored location restrictions for marijuana shops, and her office cites thousands of potential viable properties for different kinds of businesses.

Here is the city’s licensing decision: