Winter Park Town Council continues to mull potential marijuana regulations following the passage of a 5% special sales tax in November.

On Tuesday, discussions centered around how to approve licenses, either through a lottery or merit system, and how to space out dispensaries in town.

The proposed regulations would allow for four marijuana business licenses — three in downtown and one for Old Town — along with one consumption lounge. In the future, council could increase the number of licenses by amending the ordinance.

During discussions, a suggestion to space out the marijuana businesses based on town zoning raised a number of questions, including how that could conflict with a lottery program or lead to neighboring dispensaries that are technically in different zones.

Other council members preferred requiring businesses to be a set distance from each other, such as a 500 foot radius. This didn’t come without its own concerns, though, as council members conceded there is limited commercial space in town.

“I think we understand that the most difficult part of this process is going to be finding vacant land or a landlord who’s willing to allow the business in their space,” Mayor Nick Kutrumbos said.

In addition, council talked about how to fairly approve licenses when the interested applicant pool is larger than the available number of licenses. Discussions indicated that several marijuana businesses have shown interest since the election.

Town staff said they could research similar communities’ marijuana regulations for the continuing conversations.

While no regulations have been adopted, the proposed ordinance would allow for a consumption lounge and medical marijuana delivery.

The lounge has been a contentious issue, and council member Mike Davlin said he would vote against any ordinance that allows one. Other elected officials said a consumption lounge doesn’t seem much different than a bar with alcohol.

Though specifics of the ordinance are still being discussed, a majority of council members has voiced support for passing regulations and lifting the moratorium on marijuana businesses. Also, the special sales tax will be partly dedicated to funding mental health initiatives.

“If we put too many restrictions on them, then we’ll have four licenses that no one can really use,” Council member Jennifer Hughes said. “ A big part of that is the tax is going to mental health, which is so needed up here right now, so why put that off?”

In other business:

• New member Rebecca Kaufman was sworn in on council.

• The town updated its code for site and building design.

• Council approved a liquor license for Mexicali Tacos, a new restaurant at the base of Winter Park Resort.

• Council approved a special event permit for Winter Park Resort to offer drink specials at various restaurants at the base for Mardi Gras on Feb. 13.

• Amendments to the development improvement agreement and intergovernmental agreement with the Roam development passed.

• The town updated town code to consolidate developer financial guarantee, public improvement cost recovery and public improvement cost sharing requirements.