Legal weed in NM may be a buzzkill for Colorado dispensaries » Albuquerque Journal

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Duke Rodriguez, CEO of Ultra Health, sees the opportunity for New Mexico pharmacies to benefit from doing business outside of the state. (Roberto E. Rosales / Albuquerque Journal)

Copyright © 2021 Albuquerque Journal

Legal recreational cannabis has been an economic boon for Trinidad and many other small towns across Colorado’s southern border.

However, the recent legalization of recreational cannabis in New Mexico could force pharmacies in the area to adapt to changing demand as operators in New Mexico begin to set up stores and pursue similar strategies.

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Kim Schultz recalls what Trinidad was like before cannabis took over. When she moved to the area in 2003, the city was in a boom-and-bust economic cycle as key industries such as coal and natural gas closed.

As a result, high unemployment rates, a population decline and vacant buildings remained throughout the city center.

“We had a lot of wear and tear out here from professionals and skilled workers,” said Schultz.

Vacant buildings in Trinidad, Colorado were filled by cannabis-related companies after recreational cannabis became legal in the state. Now there are concerns that if recreational cannabis becomes legal in New Mexico in a year’s time, businesses could take a hit. (Andy Stiny / For the diary)

When Colorado legalized recreational cannabis in 2014, Trinidad – 15 miles from the New Mexico border on a busy freeway – became a seemingly overnight hot spot.

Suddenly, investors began speculating about buildings that had been abandoned for years, and various cannabis stores popped up around the city.

Today the city with almost 9,000 inhabitants has almost 30 pharmacies.

Schultz, co-owner of Trinidad Higher Calling U pharmacy, said the cannabis industry has been an economic boon to the region.

“We brought a lot of people here from Denver … and brought a whole new culture and age group to Trinidad,” she said. “We let this happen practically overnight.”

However, many in southern Colorado recognize that New Mexico and Texas buyers make up the bulk of their customers. Linked to this is the ongoing concern that they might shop in New Mexico instead.

Dustin Sisneros, who works at the High Valley Pharmacy in Antonito, Colorado, just across the state line, estimates 60% of his customers are from New Mexico. While he anticipates a slump in revenues, he believes cities like Trinidad and Durango, which have dozens of pharmacies, will feel the effects even more.

“We are concerned,” said Sisneros.

For Duke Rodriguez, CEO of Ultra Health, that type of impact is part of the plan.

Estevan Mendoza, a budtender at Ultra Health in Santa Fe, measures a gram of Red Dragon for a medical marijuana patient. By next year, New Mexico pharmacies will be selling recreational cannabis. (Eddie Moore / Albuquerque Journal)

Rodriguez, who oversees about two dozen pharmacies across New Mexico, said his company will try to cater to New Mexicans and Texans who would normally travel to Colorado for cannabis.

“It is more than a hope – we fully intend to influence the need for New Mexico residents to enter Colorado,” he said.

Part of this strategy mimics that of Trinidad and other cities in southern Colorado. In the past few years, Ultra Health has set up pharmacies in border towns like Clovis, Clayton, and Sunland Park, which are typically geared towards those traveling to and from Texas.

Rodriguez estimates that Texans will ultimately make up 42% of the recreational cannabis market in New Mexico.

However, legalization has raised concerns that they will be buying cannabis in New Mexico to bring it back to their home state, where it is still illegal.

Rodriguez said his company is aware that some customers are most likely to use cannabis across state lines.

“We warn people that what you buy in New Mexico should be consumed in New Mexico,” he said. “We’re not naive about realizing that there will be some adults who are likely to cross state lines.”

However, in some cases, this may be easier said than done. Major highways leading to Ultra Health’s Sunland Park, a mile from the state line, pass through Texas first. People can get to the rest of New Mexico without crossing state lines just via more rural roads.

Still, the potential boon of cannabis has excited some areas of New Mexico about the possibilities.

In Clayton, near the Texas and Oklahoma state lines, city manager Ferron Lucero said his city is already starting to talk about repurposing parts of the city so that more pharmacies can open.

According to Lucero, Clayton officials have spoken to those in Trinidad about the pros and cons of legal cannabis and that the potential for more industry in the area is badly needed. Ranching, along with government jobs in schools and the local jail, makes up most of the work available.

“(Trinidad) had a lot of buildings that were boarded up and vacant and other businesses were moving in,” Lucero said. “If the same thing happened here, that would be positive.”

However, not everyone is so optimistic about the potential benefits of legal cannabis.

Scott Berry, city manager for Raton, whose city is just across from Trinidad on I-25, said legal cannabis has been available for several years given its proximity to Colorado. However, he does not see that Raton will derive economic advantages from the industry in the future.

It’s not that the city couldn’t use it. Raton has often had the same economic problems as Trinidad – Berry estimates that there are around 200 vacant buildings across the city.

However, it seems like a huge challenge for him to compete against the dozen of pharmacies that are only about 20 minutes away.

“They have been established for years, they have a leg up,” Berry said of Trinidad. “There is an expectation that it will bring this financial boom to the region – I’m a little pessimistic.”

Many Colorado pharmacy workers do the same calculation. Several “budget tenders” told the journal that, given the great variety of products, the region will have around five years before a toll is actually due.

Schultz said that buying cannabis in Trinidad isn’t just about buying groceries during a pit stop. It becomes an experience in itself, making Trinidad a destination for cannabis tourism.

“There are so many stores and so many different things to buy,” she said.

There is a realization, however, that Trinidad cannot simply rely on an industry – it’s a mistake the region made before, and Schultz hopes the city will expand into growing businesses and other sides of the cannabis industry in addition to retailing.

Because as an employee of the Trinidad pharmacy told the journal, cannabis is not only the hottest job in town. It quickly becomes the only one.