At the end of last week, a federal court struck down a law passed in 2010 that would have required certain online retailers to collect Colorado state sales tax for online purchases.

The court’s decision held that the law was unconstitutional, because it placed an undue burden on interstate commerce. Generally speaking, this is because Colorado cannot pass laws that restrict commerce or business that crosses state lines, because the U.S. Congress has the sole responsibility to regulate that area of the law.

Legalese aside, this means that when you buy things online you still do not have to pay sales tax, unless the online retailer is actually located within Colorado.

Some news stories have spun the issue, saying the decision “vindicated” the Republicans or that the Democrats lost.  But, the truth is that the court didn’t care who “won.” Knowing Judge Blackburn, the judge who wrote the decision, I am confident that the decision was neutral and objective, and legally the correct outcome.

However, the real issue is not which party won a fiscal battle, but what affect the decision will have going forward.  The law was originally passed with two laudable goals: 1) to generate additional tax revenue to aid an out-of-balance state budget; and 2) an attempt to even the playing field for local retailers (some called it the “Amazon Tax”).

I would be a hypocrite and liar to say that I don’t shop online, or that I don’t love seeing “$0.00” for sales tax when making a purchase. But, as a proponent of small businesses, I think it is critical to support the local economy, as well as continue to search for viable solutions for our unwieldy state budget. Regardless of whether the court was right in making its decision (which it probably was), there still exist two problems in need of solving.

Currently, online retailers have three main advantages over local brick-and-mortar retailers: 1) little or no sales tax encourages online spending; 2) low overhead (no fancy storefronts needed); and 3) a much larger potential customer base. The proposed law would have at least limited one of the three advantages that online retailers have over local stores.

Additionally, as far as the state budget is concerned, the proposed sales tax produced a new source of funding to the government that was based on consumption, rather than taking more from your paycheck every week, before you even cash it. Unless you also receive a paycheck from an online retailer, online shopping is a one-way street that siphons money out of the local economy.

So, while it’s nice to buy things for the advertised price, with no add-ons inflating the bill at check-out, it is equally important to remember where your money is going, whether to New Jersey, China, India, or anywhere else.

_ This week, a district court judge in Boulder held that the city-wide ban of medical marijuana dispensaries in Longmont, Colorado, does not constitute a “takings” under the Fifth Amendment. The three dispensaries that brought the case against the city have 45 days to appeal the decision, but for the time being the ban will remain in full force.

The ruling is based on the idea that there is no state or federal constitutional right to operate a dispensary, therefore no right has been taken away by implementation of the city-wide ban. However, an interesting issue that may develop down the road is whether the dispensaries can successfully make an analogy between marijuana dispensaries and adult entertainment.

On its face, it seems that the Longmont ban is based on morality. I can only guess that the citizens of Longmont have decided that they would prefer not to have marijuana sold within city limits, because they do not believe in the sale of marijuana, regardless of whether it is for health care or recreational purposes. This seems like the same argument that has been made for adult entertainment for 70 years. Basically, “we don’t want it in our community.”

Without delving into the litany of U.S. Supreme Court cases regarding adult entertainment, the short version is that adult entertainment is a form of protected speech, and therefore a community can limit where it occurs under the police powers of the state, but it cannot absolutely ban it.  There must be a time and place for adult entertainment.

While I don’t specialize in medical marijuana (I’ve never done a single case), this sounds like a persuasive argument.  The dispensaries have lost the first round arguing that they have Fifth Amendment protection, but maybe they can find success by arguing that the First Amendment applies.  While limitations on the time and manner for marijuana sales may not be ideal, at least it would be a way to operate within city limits.