Two weeks ago, the News 5 Investigative team received tips surrounding alleged wrongdoings at a local retail marijuana store which claimed to gift a small amount of marijuana in exchange for a separate purchase.
Before we went in with undercover cameras, we researched the business model Hopp’z Cropz used to get around a clear amendment to the law signed by the Governor in June.
The Act, 16-1261, better known as Retail Marijuana Sunset, states that “it is unlawful… to transfer marijuana… at no cost… if the transfer is related to (payment) for any other service or product.”
State Representative Kit Roupe, who co-sponsored Marijuana Sunset, told News 5, “I think it’s kinda of a tax evasion in a way. I really don’t think it’s fair to those folks who are following the law very precisely and legitimately.”
During our first visit to Hopp’z Cropz, we were asked to sign an “agreement” which asked for the last four digits of a social security number and sign that we were over the age of 21, which was confirmed by a driver’s license which they photocopied. And with that, our undercover “buyer” was now a member of the “Giftee” program. The employee then sold us a small glass pipe for $20 and “gifted” us just more than a gram of the green stuff.
During our second visit to the Boulder Street locale, we stated we were members, and we were sold a similar small glass pipe for $20 and a different strain of marijuana. This one they call “Girl Scout Cookie.” An employee told us, “any of my top shelf is going to have about 27-percent THC.”
Prior to commencing our probe, we spoke with police about the business. Officers with the vice/narcotics division told us the business was on their radar. Little did we know how much Hopp’z Cropz was on the radar with authorities — just days before our story aired Monday night, police raided the two stores. Police confirmed that they confiscated an unknown amount of marijuana, but made no arrests.
In an interview with an undercover cop prior to our report, he told us, “when I give you money for a product, it’s no longer a gift. It’s a purchase.” He went on to call the business “a sham.”
We reached out and met with Joe Hopps who agreed to meet with us the day the story was set to air, but he never showed up. So far, it’s unclear what police charges Hopps faces, if any. But police told News 5, “we are currently working through the evidence to determine which direction we will go in regards to charges.”
What is clear is that Hopp’z Cropz, which remained open on Monday morning, does not have a city tax license, and sidestepped the fees and regulations legal marijuana businesses are held to. That makes legitimate dispensary owners like Elisa Kappelmann in Colorado Springs uneasy.
“Now they have these shops going up that that say if you buy this goldfish for a dollar I’ll give you a joint, and the police doesn’t seem to be doing anything about it,” Kappelmann said.
Police said the business model Hopps operated under was questionable at best. “They’ve been getting away with it for a while… and they’re getting comfortable with their lives and it’s going to be a problem for them,” officers said.
Jason Warf, who oversees The Southern Colorado Cannabis Council, suggests business owners should always do their homework if they want to avoid arrest and a legal showdown. “You’re sort of poking the bear with that business model, I think,” Warf said.
In the meantime, sources tell News 5 that Hopp’z Cropz continues to operate without the marijuana police recovered. As for the people who made purchases and were gifted cannabis in these stores — they’re likely in the clear. A News 5 attorney tells us the legal burden is on the store, but that’s no guarantee against arrest.