DENVER — Denver City Council will consider a proposal Monday to drastically cut license fees for marijuana delivery services and extend -- forever -- a requirement that delivery company owners come from socially disadvantaged backgrounds.
The current "social equity" mandate is set to end in 2024, but the city aims to call the bluff of dispensaries waiting until then to establish their own delivery services rather than rely upon the existing businesses.
"It is easy to see that Denver preventing stores from doing their own delivery so social equity businesses have the first crack at this business type is resulting in the industry choosing profit over supporting more equitable access to the industry," Department of Excise and Licenses spokesperson Eric Escudero said.
He said only one in 20 Denver dispensaries offer delivery services. That's compared to 80% of stores in Aurora, where the dispensaries can do their own delivery.
Denver delivery driver Michael Diaz-Rivera, owner of Better Days Delivery, said his company would likely not make it without city council intervention. He currently averages about five orders a day, but needs more than a dozen to break even.
"It has been tough getting dispensaries to match with us, and we can’t do anything without dispensaries buying in," he said. "Business has been slow."
The social equity requirements mandate delivery services be owned by people who lived in disadvantaged areas, make less than 50% of the state's median income, or who have a personal or familial past marijuana charge or arrest.
Escudero argues extending that requirement forever will incentivize dispensaries to make a deal with drivers like Diaz-Rivera.
"[It] gives the market regulatory certainty so any stores holding out for the opportunity to do their own delivery in two years have no reason to hold out anymore," Escudero said.
Without the extension, Diaz-Rivera worries his burgeoning business will fold under the competition.
"That gives the bigger players a chance to just come in and do delivery without us, and just really knocks all our opportunity out of the way," he said.
If city council approves the proposal, it would also slash his costs. In the first year of his business, Diaz-Rivera said, he's spent $30,000 on licenses and permits. The proposed reduction cuts annual fees from $2,000 to $25 for delivery companies and the dispensaries with which they work.
The proposal would not reduce state licensing fees.
"Right now, looking at my numbers, it would be tough to keep going much past this year if we don’t get that help from city council," Diaz-Rivera said.
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