Fruita passes tax on medical marijuana, becomes first city in state to tax drug

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FRUITA, Colo. (KKCO) - Based on the unofficial results of Tuesday night's municipal elections, Fruita has become the first city in the state to place an additional tax on medical marijuana.

"Referred Issue A" asked voters to approve a five percent sales tax increase on all medical marijuana transactions. That five percent would be on top of the three percent sales tax most cities across the state already collect.

Sixty percent of voters voted in favor of the tax. Only 37 percent voted against it. These results are unofficial until they're certified by the Fruita City Clerk.

Although Fruita does not currently have any medical marijuana dispensaries, city officials say they're trying to be pro-active and create a system to regulate them in the future given that current state laws are vague and don't give cities much guidance on how to do that.

"Our legislators at the Capitol are working through this issue now, but cities have to deal with it immediately," says Fruita City Manager Clint Kinney. "This has definitely become an issue of local concern and the City of Fruita is just trying to be ahead of the curve."

The city has already put a number of its own rules into place, including land use regulations that dictate where dispensaries can and can't operate. But officials say as more regulations are established, the city will bear the brunt of the costs to enforce them and they felt the measure would be a fair way to offset those costs.

"We discussed the opportunity to put a tax on that to help pay for what the regulations are going to cost," says Kinney.

Fruita currently has one pending application for a dispensary. City officials say, however, that it likely won't go through because its proposed location is close to a daycare center and would violate city land use regulations.

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