Steamboat officials recommend denying Golden Leaf recreational marijuana license because of co-owner’s ‘moral character’
February 11, 2014
Steamboat Springs — More problems have surfaced for a medical marijuana dispensary in Steamboat Springs wanting to begin selling marijuana for recreational use.
City officials are recommending a retail marijuana license be denied for Golden Leaf because they have determined one of the three owners is not of "good moral character." With that designation, the city cannot issue a license, according to city code.
The city claims Golden Leaf co-owner Joshua Scruggs failed to disclose his criminal history when the business submitted its recreational marijuana application with the city.
The city's findings are outlined in a Feb. 4 letter addressed to Golden Leaf and signed by City Clerk Julie Franklin. The letter was provided to the Steamboat Today after the newspaper filed a public records request.
As part of the application process, those wanting to obtain a retail marijuana license must submit an individual history form and disclose "certain criminal matters, including those which result in conviction or receipt of a deferred judgement or deferred sentence," the letter states.
Scruggs failed to disclose any past convictions, but an investigation conducted by the city showed the 35-year-old has been arrested twice.
Scruggs was arrested in Arvada when he was 18 years old. According to the letter, he was charged with driving while ability impaired, reckless driving, possession of less than 8 ounces of marijuana and possession of drug paraphernalia. Scruggs was given a suspended sentence on the possession charge and was convicted of reckless driving.
When a judge hands down a suspended sentence, the person convicted of the crime typically does not serve any jail time as long as they successfully complete probation.
Scruggs was 20 years old when he was arrested by the Jefferson County Sheriff's Office and charged with misdemeanor tampering, according to the letter. Scruggs was convicted, and his sentence included a 60-day suspended jail sentence.
"Mr. Scruggs is not of good moral character, and his character and reputation are not satisfactory to the authority due to his misrepresentation of his criminal history," the letter states.
Scruggs said Tuesday the arrests occurred when he was much younger, and he believes he is of good moral character.
He said he looked at the criminal history question the wrong way. He thought it referred to more serious crimes such as felonies and those that resulted in prison time.
"It's not like I was purposefully lying," Scruggs said. "To me, it was just a misunderstanding and my mistake."
Scruggs will try to change the city's mind Wednesday during a meeting with Police Chief Joel Rae, City Clerk Julie Franklin and City Attorney Dan Foote.
"I'm going to move forward saying I believe I made a mistake," Scruggs said. "I wasn't purposely lying, and I believe I am of good moral character."
According to Foote, the Steamboat Springs City Council, acting as the Steamboat Springs Marijuana Licensing Authority, ultimately will decide whether to issue a license to Golden Leaf.
If Scruggs is not able to win over the city, Scruggs said it is possible he will have to leave the business. The other Golden Leaf owners are Charlie Magnuson and Golden Anderson.
Rocky Mountain Remedies still is the only place for adults ages 21 and older to legally buy marijuana for recreational use. The business began selling recreational pot Jan. 8.
The issue of Scruggs' moral character is the latest challenge Golden Leaf has faced in its effort to begin selling marijuana for recreational use.
Golden Leaf still has not passed its inspection. During the latest inspection of the facility at 1755 Lincoln Ave. on Feb. 4, Golden Leaf failed to have several required items in place. Among these items, Golden Leaf failed to have the necessary security cameras in place and did not have the required signs. The business also lacks an entrance separate from the one used by patients buying medical marijuana.
The City Council, acting as the Marijuana Licensing Authority, was scheduled to hold a hearing for Golden Leaf's license Tuesday night, but Golden Leaf requested action be postponed until March 4. The council Tuesday night, without any discussion or comment, voted to move the hearing date.
Golden Leaf already has been licensed by the state to sell recreational marijuana.
Steamboat's third marijuana business, Natural Choice Co-op, also has received its state license. Rae said last week Natural Choice has not yet begun the city's licensing process for recreational marijuana sales.