Colorado Marijuana Hospitality Business License

What Is a Marijuana Hospitality Business in Colorado?

A marijuana hospitality business in Colorado is a business that permits on-site consumption of marijuana by adults 21 years and older on its premises. Persons or entities that engage in this marijuana business may operate a mobile facility or use a permanent location. A mobile facility is any premises licensed by the state marijuana licensing authority used by a marijuana hospitality business in a motor vehicle that can travel on public roads. While marijuana users can consume marijuana on the premises of marijuana hospitality businesses, Colorado laws do not permit such hospitality businesses to sell marijuana.

Does Colorado License Marijuana Hospitality Business?

Yes. In 2019, the Colorado Legislature enacted House Bill 19-1230 concerning marijuana hospitality establishments. This bill established two new marijuana business license types: the marijuana hospitality business license and the marijuana hospitality and sales business license. While both marijuana licenses essentially allow the same kind of activity, they are separate and distinct from each other. HB 19-1230 requires existing hospitality businesses or interested entities to obtain marijuana hospitality business licenses to permit their patrons to consume cannabis on their premises.

Although marijuana is legalized in Colorado, the State prohibits its public consumption. Per Colorado Revised Statutes, 44-12-901, it is illegal to consume marijuana or marijuana products in a licensed retail marijuana establishment other than a licensed marijuana hospitality establishment. For a mobile marijuana hospitality business, the State marijuana licensing authority requires registering their motor vehicles and installing surveillance cameras inside such motor vehicles. Their activities must not be visible outside of the motor vehicle in which they operate. Licensees must also ensure their vehicles are adequately ventilated.

In Colorado, a licensed marijuana hospitality business must institute a standard operating procedure to destroy any marijuana waste left over by its patrons. Subject to local and State approvals, HB 19-230 authorizes hospitality businesses to allow marijuana users to consume medical and retail marijuana in their spaces. This bill created an exception to the Colorado Clean Indoor Air Act. The Marijuana Enforcement Division (MED) of the Colorado Department of Revenue (DOR) is responsible for issuing marijuana hospitality business licenses. The Division also regulates the activities of licensed marijuana hospitality businesses in Colorado.

How to Apply for a Marijuana Hospitality Business License in Colorado

Typically, all marijuana license applicants in Colorado, including the marijuana hospitality business license, must demonstrate a minimum of two years of residency in the State. Anyone or entity looking to obtain a marijuana hospitality business license in Colorado must apply to the Marijuana Enforcement Division (MED), a division under the Colorado Department of Revenue (DOR). They can use the online application portal provided by the MED or apply using paper forms. New users on the online application portal must register to enable them to apply using this portal. License applicants who choose the online application option do not need to go through the paper application process. The Marijuana Enforcement Division provides a quick guide for applicants who would instead prefer to apply online.

To begin the paper application, an interested person or entity must complete the Marijuana Hospitality Business License Application Form and submit it with supporting documents to the MED. An applicant must indicate that they are applying for a new license on the form and then select hospitality business as the license type.

Just like other regulated marijuana businesses in Colorado, the MED requires marijuana hospitality business license applicants to determine their suitability before submitting their applications. As such, the Division provides two separate forms to help license applicants find their suitability for this license. They must fill out the appropriate finding of suitability form listed below and submit it with the Marijuana Hospitality Business Application Form to the MED:

1. The Marijuana Finding of Suitability Application - Owner Entity: This is for any entity that holds a minimum of 10% interest of the Regulated Marijuana Business owner's interest, such as:

   1. An executive or qualified institutional investor with 30% or more of the Regulated Marijuana Business
   2. Any affiliate or entity with authority to exercise control of the Regulated Marijuana Business

2. The Marijuana Finding of Suitability Application Form - Natural person: This form is required for any natural person who holds at least 10% interest of the Regulated Marijuana Business owner's interest. Such persons include managers, executive officers, or other individuals who can exercise control of the Regulated Marijuana Business.

The MED requires an owner entity who submits the owner entity suitability application form to equally complete the natural person suitability application form and include it in their submission.

A marijuana hospitality business license applicant must also pass criminal and credit background checks. Consequently, they must have their fingerprints taken by any of the MED-approved third-party fingerprint vendors in Colorado and submit evidence of complete fingerprinting with their application to the MED. This proof is primarily in the form of a receipt issued by the fingerprint vendor.

Marijuana is a regulated business in Colorado. As such, the MED requires marijuana hospitality business license applicants to obtain a state tax license suitable for their proposed marijuana business. Also, a prospective marijuana hospitality business licensee in the State must fulfill specific State and federal employment requirements outlined by the Colorado Department of Labor and Employment (CDLE). To assist new business entrants, including marijuana business licensees, the CLDE provides an employer checklist as part of such requirements.

License applicants must pay all required fees via checks or money orders and attach the payment proof with their applications. Any licensing fee meant for the local jurisdictions where applicants intend to operate their facilities must also be included in the applications but as a separate form of payment. After paying the requisite fees, an applicant can submit their completed application forms, proof of payment, and the required supporting documents via mail to any of the following MED's offices:

Marijuana Enforcement Division

1697 Cole Blvd., Suite 200

Lakewood, CO 80401

Northern Regional Office

Marijuana Enforcement Division

275 South Main Street, Suite 101

Longmont, CO 80501

Southern Regional Office

Marijuana Enforcement Division

P.O. Box 15128

Colorado Springs, CO 80935

Western Slope Regional Office

Marijuana Enforcement Division

632 Market Street, Suite G3

Grand Junction, CO 81505

The Lakewood office location is the only one that accepts in-person application submissions. Applicants who opt to deliver their applications in person can do so between 8:00 a.m. and 5:00 p.m., Monday through Friday.

When applying for a marijuana hospitality business license in Colorado, an applicant must ensure that the proposed municipality of operations permits the establishment of marijuana businesses. Doing this is crucial to prevent the MED from denying their application. The MED updates a list of local authorities in Colorado that permit marijuana businesses in their jurisdiction periodically. Generally, the MED approves or denies a submitted marijuana license application between 45 and 90 days after receiving it.

What Restrictions and Limitations Apply to Marijuana Hospitality Business Establishments in Colorado?

House Bill 19-1230 prohibits the following activities on licensed marijuana hospitality business premises in Colorado:

1. The visible consumption from outside of marijuana or marijuana products
2. Vending marijuana or exchanging it for remuneration on the premises of a licensed marijuana hospitality business establishment
3. The distribution of free marijuana, either by the licensed marijuana hospitality business establishment or its patrons on the establishment's premises
4. Consumption of marijuana or marijuana products by on-duty employees of licensed marijuana hospitality establishments
5. Use of lighter, matches, or a device using any liquified petroleum gas
6. Smoking of tobacco products
7. Consumption of alcohol
8. Consumption of marijuana by patrons who show signs of intoxication

How Much Does a Marijuana Hospitality Business License Cost in Colorado?

A marijuana hospitality business license in Colorado costs a total of $2,200. While $1,000 is the license application fee, the remaining $1,220 goes for the licensure fee. Applicants must split the total cost into two separate checks; $500 for the local jurisdiction they intend to operate their marijuana hospitality business and $1,720 for the State. Marijuana hospitality business license holders in Colorado pay $300 as a renewal application fee and $915 for license renewal. These fees were advised by the Colorado Department of Revenue (DOR) in their emergency rules adopted effective July 1, 2021. The MED will not process a license application or renewal request until it receives the required payments.

All payments for marijuana hospitality business licenses in Colorado must be made payable to the Colorado Department of Revenue. The MED does not accept cash payments for licenses. The acceptable means of payment are money orders and checks. Applicants or licensees (for those paying for license renewals) can also make payments via credit card authorization. The MED equally uses a Colorado Interactive Payment System to collect payments from license applicants or license holders. The MED usually advises persons who opt for this payment option with online payment links via email once they receive their applications or license renewal requests.

Can Marijuana Hospitality Business Licensees Hold Other Cannabis Licenses in Colorado?

House Bill 19-1230 did not state expressly whether a marijuana hospitality business license holder in Colorado can hold other cannabis licenses. It, however, permits retail food businesses to apply for a license to operate a marijuana hospitality business in a secluded section of the retail food business premises. The bill does not authorize a marijuana hospitality business to manufacture marijuana-infused products (medical or recreational) or add cannabis to foods provided or produced at a retail food business.