Oakland Pot-Growing Plan Worries Small Bud Tenders

Oakland, Calif. — After weathering the fear of federal prosecution and competition from drug cartels, California’s medical marijuana growers see a new threat to their tenuous existence: the “Wal-Marting” of weed.

The Oakland City Council on Tuesday will look at licensing four production plants where pot would be grown, packaged and processed into items ranging from baked goods to body oil. Winning applicants would have to pay $211,000 in annual permit fees, carry $2 million worth of liability insurance and be prepared to devote up to 8 percent of gross sales to taxes.

The move, and fledgling efforts in other California cities to sanction cannabis cultivation for the first time, has some marijuana advocates worried that regulations intended to bring order to the outlaw industry and new revenues to cash-strapped local governments could drive small “mom and pop” growers out of business. They complain that industrial-scale gardens would harm the environment, reduce quality and leave consumers with fewer strains from which to choose.

“Nobody wants to see the McDonald’s-ization of cannabis,” Dan Scully, one of the 400 “patient-growers” who supply Oakland’s largest retail medical marijuana dispensary, Harborside Health Center, grumbled after a City Council committee gave the blueprint preliminary approval last week. “I would compare it to how a small business feels about shutting down its business and going to work at Wal-Mart. Who would be attracted to that?”

The proposal’s supporters, including entrepreneurs more disposed to neckties than tie-dye, counter that unregulated growers working in covert warehouses or houses are tax scofflaws more likely to wreak environmental havoc, be motivated purely by profit and produce inferior products.

“The large-scale grow facilities that are being proposed with this ordinance will create hundreds of jobs for the city,” said Ryan Indigo Warman, who teaches pot-growing techniques at iGrow, a hydroponics store whose owners plan to apply for one of the four permits. “The ordinance is good for Oakland, and anyone who says otherwise is only protecting their own interests.”

Council members Rebecca Kaplan and Larry Reid, who introduced the plan, have pitched it largely as a public safety measure.

The Oakland fire department blames a dramatic rise in the number of electrical fires between 2006 and 2009 in part to marijuana being grown indoors with improperly wired fans and lights. The police department says eight robberies, seven burglaries and two murders have been linked to marijuana grows in the last two years.

Reid and Kaplan also are open about their desire to have the city, which last week laid off 80 police officers to save money, cash in on the medical marijuana industry it has allowed to thrive.

Oakland’s four retail marijuana stores did $28 million in business last year, and if sales remain constant, the city would get $1.5 million this year from a dispensary business tax that voters adopted last summer. A similar tax on wholesale pot sales from the permitted grow sites to the dispensaries would bring in more than twice that amount, the city administrator’s office has estimated.

“Allowing medical cannabis and medical cannabis products to be produced in a responsible, aboveboard and legitimate way will be a benefit to the patients, to the workers and to the people of Oakland,” Kaplan said.

Adding to the anxiety of growers

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Democratic Party Decides Not To Endorse Marijuana

Reporting from San Jose — The state Democratic Party decided Sunday not to endorse the marijuana legalization initiative on the November ballot after a swift, passionate debate that left little doubt most Democrats in the hotel meeting room intend to vote yes at the polls.

The party decided to adopt a neutral position on Proposition 19, leaving the many local Democratic committees and organizations free to endorse the measure.

Advocates for an endorsement cited many reasons to back the initiative, but opponents pressed one overriding concern: a yes vote could damage statewide candidates in competitive races.

“We’re concerned that our candidates, Jerry Brown, Barbara Boxer and others, who have actually come out against this are going to be compromised,” said Steve Preminger, the chairman of the Santa Clara County Democratic Central Committee, “so we’re going to get lost in a discussion about the merits of whether we should legalize or not, when, really, we the Democratic Party want to put all of our efforts into electing our ticket.”

Robert Cruickshank, public policy director for the Courage Campaign, which backs progressive causes, called for the vote in an attempt to overturn a party committee’s recommendation to adopt a neutral position. He started by reminding the assembled Democrats that the party’s chairman, former San Francisco state Sen. John Burton, has said pot was the issue that would motivate young voters to go to the polls in this off-year election.

“If we endorse Proposition 19 and take a courageous position to support reform, just as we took courageous positions on same-sex marriage and other contentious issues, we will win the moral argument, we will win Proposition 19 and we will win races in November,” Cruickshank said.

Proposition 19 would allow Californians 21 and older to grow, possess and transport marijuana, and allow cities and counties to opt to regulate and tax marijuana sales.

Burton said he believes the issue will engage young voters, a key constituency for Democrats. He abstained on the vote but said he was not convinced that an endorsement would hurt Brown’s campaign for governor, Boxer’s bid for reelection to the U.S. Senate or the other Democrats running for top state offices. “The statewide candidates, I guess, are all antsy,” he said.

He said he would vote for the initiative, adding: “And I haven’t had a joint in 30 years.”

The party’s executive board, which includes elected officials and party representatives from across the state, voted 101 to 85 against an endorsement. But the Democrats, despite taking a cautious stance, appeared solidly behind the initiative, cheering and whooping much more raucously for the pro-endorsement speakers.

Dan Rush, an official with Local 5 of the United Food and Commercial Workers, who is running the legalization campaign’s labor outreach, said an endorsement would have been a “great boost” but that a neutral position was still a victory. “We could have gotten a resounding no,” he said.

Source: Los Angeles Times (CA)
Author: John Hoeffel, Los Angeles Times
Published: July 18, 2010
Copyright: 2010 Los Angeles Times
Contact: letters

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Marijuana Price Affected By Fears Of Black Market

Concerns about affordability arise as dispensary operators set prices high to prevent resale on the streets.

Maine’s new network of medical marijuana dispensaries is expected to make the drug more accessible to disabled and ill patients.

Making it affordable may be another matter, however.

While the dispensaries are state-licensed nonprofits, most plan to charge virtually the same prices as illegal dealers charge on the street — from $300 to $400 an ounce.  At those prices, a typical patient with cancer or multiple sclerosis might spend $500 to $600 or more each month to relieve symptoms with medication that is not covered by insurance.

“I think $300 and $350 is way too much for a weed that can grow outside,” said Andrea DiAnni, a southern Maine resident who uses medical marijuana to treat nausea and pain from a chronic illness.  “I know what it’s like to have to go without medication ( because ) there were times I couldn’t afford it.”

Newly licensed dispensary operators say they want marijuana to be affordable, too.  But, they say, offering it at $100 or $200 an ounce would encourage patients to sell excess medication on the black market.

“There is an unfortunate fact that there is still this black market for this commodity,” said Rebecca DeKeuster, chief executive officer of the Northeast Patients Group, the group planning to set up dispensaries in Portland and three other Maine communities this fall.  “If our prices are too low, it encourages diversion.”

Maine’s Department of Health and Human Services has awarded licenses for the state’s first six medical marijuana dispensaries, which plan to start selling the drug to qualified patients later this year.  Two more dispensaries are expected to open early next year after a second round of license applications is submitted next month.

State officials selected the first dispensary operators two weeks ago based on their nonprofit business plans and other criteria, including whether discounts would be offered for low-income patients.  The state is allowing the market to dictate prices, however.

“We honestly didn’t take ( price ) into consideration,” said Kathy Bubar, a DHHS administrator who sat on the selection panel.  “We did look at ( whether ) the profits were excessive.  We took points away for that.”

Some have argued that high dispensary prices, not low ones, will encourage people to buy the drug illegally on the street.  Patients who buy legally from a dispensary also have to pay to go to a doctor for a recommendation and have to pay a $100 annual registration fee to the state.

“If we start off lowering the prices in the medical marijuana community, the black market would have to come down in prices, too,” said Charles Wynott of Westbrook, a longtime medical marijuana advocate who uses the drug to treat the symptoms of AIDS.

The patients who need the medication most are often disabled due to their illnesses and live on monthly disability checks, in many cases just $690 a month, according to Wynott and other advocates.

Wynott is one of a number of caregivers in southern Maine who grow the drug on a small scale for some of those patients at $150 an ounce, or less.  For some of his sickest and neediest patients, Wynott said, “we don’t even ask for money at all.”

He doesn’t worry that the patients are turning around and selling the drugs for a profit, he said, and dispensaries should not raise their prices for that reason, either.

A growing number of patients in Maine are now cultivating their own marijuana at home to save money.  But, unless they invest hundreds of dollars in indoor growing equipment, patients typically don’t produce enough of their own medicine to avoid buying it altogether.

Black-market prices for medicinal pot have been an issue wherever states have legalized it, although Maine is one of the first states to require that dispensaries be nonprofit.  In California, a recent report by the RAND Drug Police Research Center concluded that decriminalizing marijuana use in general — as California voters could do this fall — would reduce the market price from $375 per ounce to about $38 per ounce based on production costs.

Northeast Patients Group expects to charge around $340 an ounce, which it says is slightly less than the street price here of $360.  But the group also is promising to make sure its neediest patients can afford the medicine.

“There would be programs for seniors and for people who are unable to purchase their medicine ( at the market price ).  I understand that concern and we want to make sure that everybody who needs this medicine can access it,” DeKeuster said.  “We do have a serious concern about diversion and we also feel we will be able to come up with a pricing structure that works for everybody.”

Another operator, who plans to open a dispensary in Wilton, said he hopes the facilities will help make medical marijuana more affordable over time, even if the prices can’t start off that way.

“I think we have a social responsibility here where our prices are not set by the black market, but we have a sense of what the black market is,” said Tim Smale, president of Remedy Compassion Center.

Smale is projecting a price of $400 per ounce in the first year of operation, but declining to $324 by the third year as start-up costs decline and sales grow.  Smale said the dispensary also will offer discounts, or even donated medicine, for patients who can’t afford those prices.

“I’m a patient, too.  I want lower prices over time,” Smale said.  “I have never been able to afford this medicine to the extent that I need this for my migraine therapy.”

Smale said the dispensaries are a big step forward for patients, but not the last step.  “I think it will be accessible.  Whether or not it’s affordable may be another story and that’s what we have to work on.”

A third dispensary operator is preparing to open Safe Alternatives in Fort Kent and has estimated its price to be $250 to $300 an ounce.  But Safe Alternatives also plans to keep prices close to market prices in its region to limit illegal resale of the drug, according to its license application.

Some have hope that prices will come down because of competition among the eight dispensaries and because more patients are growing their own or getting it from small-scale caregivers who often sell at discounted prices.

“With multiple dispensaries and a multitude of options outside of dispensaries, these dispensaries are going to have no choice but to offer reasonable prices,” said Jonathan Leavitt, who helped lead the referendum effort last fall that opened the door to dispensaries.

Concerns about diversion seem valid, up to a point, Leavitt said.

“I think that reality exists.  I just hope it’s not a smoke screen to keep prices high,” he said.  “Anybody providing patients marijuana at $400 an ounce needs to get out of the business of working with patients.  I think the numbers should come in significantly lower than that.”

Source: Maine Sunday Telegram (ME)
Copyright: 2010 Blethen Maine Newspapers Inc.
Contact: letters

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State Answers Questions About Marijuana Outlets

In the week since the state named three nonprofits to run six first-of-their-kind medical marijuana dispensaries in Maine, Kathy Bubar has heard the myths and the gripes, and she has stressed that, no, the state doesn’t intend to reconsider last Friday’s announcement.

“( It’s been ) lots of rumor-dispelling and ( questions such as ) why did we pick the people we picked and why didn’t we pick other people and are we going to change our minds,” said Bubar, director of interagency coordination at the Department of Health and Human Services.

“Obviously, with 27 applications and only eight dispensaries to be ( selected, ) there were going to be a lot of unhappy people,” she said.  “And there were.”

Bubar was one member of the four-person panel who pored over and scored applications.  DHHS’s Division of Licensing and Regulatory Services chose Timothy Smale of Remedy Compassion Center in Wilton to operate one dispensary in Western Maine, Leo Trudel of Safe Alternatives of Fort Kent to operate one in Northern Maine and Rebecca DeKeuster of Northeast Patients Group to operate four in Central Maine.

Two more dispensaries remain unnamed because no applicant scored high enough.

The Sun Journal asked Bubar to answer questions and complaints still hanging out there, as well as where the state goes from here.

One gripe: Dispensaries went to operators from California or with strong out-of-state ties.

Applicants and board members had to be Maine residents when they submitted, she said, but there was no stipulating how long they had to be Maine residents.

“So, can they come here a week earlier? Sure,” Bubar said.

Outside links, or funds, weren’t a consideration, she said.  Applications were judged on their merit.  Some operators did benefit from past experience working in California.

“I think it’s important for people to remember that your basic Bangor Savings Bank isn’t always excited about lending money to an outfit that’s growing marijuana,” Bubar said.  “I don’t believe that any of the dispensary applications that we saw stated that they were getting conventional start-up financing.”

Did operators have to have a property secured when they applied?

Originally, yes, Bubar said, but circumstances changed as more communities enacted moratoriums.  The new requirement: Give a best idea and its features and let DHHS know when a deal is inked.  Each operator is limited to one dispensary site per district.

If the Smales don’t secure the proposed building in Wilton, are they limited to that town?

No.  “They will only be limited to a location that is equally as convenient to their client base.  They are working to find a new location and are communicating with us about their plans and progress.” ( The Smales’ District 3 covers Androscoggin, Franklin and Oxford counties.  )

How will Maine insurance companies cover medicinal marijuana? What about MaineCare?

“There is no requirement because marijuana continues to be a Schedule 1 drug,” she said.  “Traditional insurance companies will not cover it, nor will MaineCare be required to cover ( it ).  It really will be out-of-pocket for people.”

What’s more, Bubar said, Maine doctors won’t be prescribing marijuana.

“Doctors certify that their patient has one of the listed debilitating conditions and in the opinion of this physician, medical marijuana may help alleviate their symptoms,” she said.  “That’s all they can do.  It’s not a prescription.”

With that note, patients apply to the state to either grow their own, hire a caregiver or buy from a dispensary.

Each of the three nonprofits approved to run the six dispensaries plans to offer a discount program for people who can’t afford their medical marijuana, Bubar said.

According to the applications, the Wilton dispensary expects to charge $400 an ounce the first year; Fort Kent, $250.  Can patients shop around?

Absolutely, Bubar said, though they must keep the state posted on which dispensary they’re using.

“We are not controlling the price at all,” Bubar said.  “The consideration the dispensaries have voiced around price is simply looking at the black-market price.”

Charge too much and they might not get people in the door.  Charge too little and they risk having product resold on the street, she said.

Having product mail-ordered isn’t an option.  Patients either have to go to the dispensary or it has to deliver to them, she said.

For the average patient, how long will an ounce of marijuana last?

That’s impossible to tell, Bubar said, since the needs of each patient will vary a great deal.  “Patients are allowed to purchase 2.5 ounces every two weeks, according to the statute.”

What happens with the two dispensaries that weren’t selected last week?

Would-be operators have until Aug.  20 to apply; a decision is due Aug.  31.

“I think we will have a number of applications from people both who applied previously for those districts and people who perhaps applied for other districts and didn’t get those,” Bubar said.  “Maybe we’ll have some people who didn’t try the first time around who now know what the expectations are and will look at the successful applications and say, ‘Hm, I could do that.’”

People who applied and weren’t successful will get $14,000 of the $15,000 application fee returned.

What’s next for the state after that?

Operators who plan to run kitchens must obtain commercial food licenses.  Other details remain, such as board members’ background checks.

Bubar said she believes the dispensaries may open, with a quickly grown crop ready to dispense, between late August and November.  State inspectors will be allowed in any time, with no notice.

“We’ll get to be very nosy about what they’re doing,” Bubar said.  “There is a lot of concern in the community about the whole issue, so we obviously will need to make sure that people are running a very good, very transparent operation.”

Source: Lewiston Sun Journal (ME)
Copyright: 2010 Lewiston Sun Journal
Contact: letters

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Oakland Could Go To Pot in a Big Way

Reporting from Oakland — Oakland could approve a plan Tuesday to set up four marijuana factory farms, a step that could usher in the era of Big Pot.

The proposal is a testament to just how fast the marijuana counterculture is transforming into a corporate culture. And it has ignited a contentious debate in Oakland that could spread as cities face pressure to regulate marijuana cultivation and find ways to tax it.

“Everybody knows it’s going bigger and big money is moving in,” said Dale Gieringer, an Oakland resident and prominent marijuana activist. As the state edges toward legalization, he said, more businessmen will seek to capitalize on a fast-growing market in a recession-hindered economy, forcing cities to make difficult choices on how to exert control.

If the City Council approves the plan, one Bay Area businessman has already made it clear that he intends to apply for a cultivation permit. Jeff Wilcox, who owned a successful construction firm and has already incorporated as AgraMed, hopes to convert his empty industrial buildings near Interstate 880 into an enormous production facility. He plans to manufacture growing equipment, bake marijuana edibles in a 10,000-square-foot kitchen and use two football fields of space to grow about 58 pounds of marijuana every day, many times the amount now sold in Oakland.

What caught the City Council’s attention was Wilcox’s projection that he could hire 371 employees and pay at least $1.5 million a year in taxes. Oakland faces severe budget deficits and has already let go of 80 police officers.

Last week, a council committee sent to the full council the proposal to allow four large cultivation operations, worried that a delay might allow other cities to get the jump on Oakland. “I do want to encourage a few large growers because I think that’s where the industry’s going, and I don’t think you’re going to be able to hold that back,” Councilwoman Jean Quan said.

But it has ignited intense opposition from medical marijuana activists, dispensary operators and growers in Oakland, who complain that the plan fails to include the growers who have risked federal prosecution for years to supply the city’s four dispensaries. Normally secretive, they have started to speak out.

“It’s not providing a pathway for folks to become more legitimate,” said Dan Grace, an owner of Dark Heart Nursery, which raises about 10,000 pot clones a month in a 3,000-square-foot space. Grace said that his operation could triple its size

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Taking The Mystery Out Of Marijuana

Lab Helps Medical Marijuana Providers Understand What And How Much To Dispense

When Dean Folda goes to pick up his medicine, he has a choice between cannabis products with names like “Grunk,” “Johnny Rocket,” and “Godbud.”

Folda, 47, says marijuana helps relieve his pain.  He’s had a myriad of health issues over the years, ranging from an accidental gunshot wound when he was 10 years old to a hole in his aorta that required two open-heart surgeries.

“I could’ve probably been the biggest pillhead in the valley,” he said.  “But I’ve found that marijuana did the same thing for me that the pain pills would do without the side effects.”

Folda isn’t sure just how or why marijuana works for him.

But a doctor and a chemist in Bozeman are aiming to take the mystery out of it.

Dr.  Michael Geci-Black, a former emergency room physician, and Noel Palmer, who has a PhD in chemistry, run the first laboratory in Montana dedicated to studying medical cannabis, Montana Botanical Analysis.

“If it’s going to be a medicine, you’ve got to treat it like a medicine,” said Geci-Black, who started the lab in 2009.  “So, I thought, ‘We’ve got to do some testing to see what’s in it.’ There’s no other medicine that doesn’t have the active ingredients ( listed ) on it.”

Even marijuana providers, or “caregivers,” aren’t always sure why certain strains of marijuana work particularly well for treating certain kinds of ailments.

A Kinder Caregiver in Bozeman, for example, sells 27 strains of marijuana in its plant form.  It also has a menu that includes 16 baked “sweet treats,” plus four diabetic alternatives; two tinctures of liquid cannabis; one tea; and baking basics “cannabutter,” “cannaoil,” “ganja cream,” and “sweet leaf honey.”

But the head of the company, Robert Carpenter, admits determining what works best for a specific person is mostly a matter of trial and error.

“It differs so much for each person,” he said.

Marijuana providers from across the state pay Montana Botanical Analysis to test “cannabinoids,” chemical compounds in their strains of marijuana, so they can have a better understanding of how to dispense it.

“If you don’t know what’s in it, how can you dose it?” Geci-Black said.  “We’re trying to establish product labeling.”

The lab tests 20 to 50 different strains each week, he said.  Testing takes about three days and costs about $100 per sample.

“I really feel like the science, it’s going to help clarify these ambiguities that everybody has,” Palmer said.

Not everyone wants high THC

On Thursday afternoon, Palmer held the dried tip of a marijuana plant in the palm of his hand, a sample a provider had given the lab to test.  He was working in the MBA’s new lab and offices in the Medical Arts Building on North Willson Avenue, where the neighbors are family-practice doctors and dentists.

For a typical test, Palmer dries a raw marijuana plant bud, then puts it in an “extraction” liquid, where it dissolves it into a lime green solution.

He puts a few drops of the solution in a vile, and puts the vile in a 3-foot tall stack of automated machines.  The machines run the solution through a series of tubes and beakers, with the results displayed on a computer monitor.

The process, called chromatography, isolates cannabinoids found in the crystals on the edges of the marijuana leaves.

For the “OG Kush” strain, a line graph on the computer screen showed levels of about 25 different cannabinoids, primarily tetrahydrocannabinol ( THC ), cannabidiol ( CBD ) and cannabinol ( CBN ).

A total of about 66 cannabinoids are believed to be present in cannabis plants, Palmer said.

“That’s why we’re interested — because THC is not the only one,” he said.  “Patients tend to like lower THC and that often has other cannabinoids in higher levels.”

Cannabidiol, for example is not psychoactive, Palmer said, meaning it tends to relieve pain without getting the user “stoned.”

But it’s hard to find CBD in marijuana in Montana.

“It’s been an arms race for THC,” which is believed to produce the “high,”

Palmer said.  “People have all but bred out CBD from cannabis samples.”

Some providers simply tout THC levels in their products, Geci-Black said.  They don’t realize the chemical could have unintended side effects.  People are making shampoos and soaps, he said, but THC may actually stymie hair growth.

“There’s one guy in town, he has lip balm that has like 13 percent THC in it,” Geci-Black said.

Even the most potent marijuana usually has no more than 20 percent THC.

What about a pill?

In Colorado, marijuana providers put cards detailing test results from labs like Geci-Black’s next to each strain in their display cases.

Frank Quattrone, owner of Pure Medical Dispensary in Denver, told the Denver Post earlier this month that he hopes the black-market names of marijuana strains “hopefully, will be come irrelevant.”

With knowledge about the chemical makeup of different marijuana, a provider could tell a patient with irritable bowel syndrome, for example, to eat a marijuana high in CBD, Geci-Black said.  That could send pain relief directly to the digestive tract where it’s needed and allow them to function normally without having to be high, he said.

Or, if a patient has knee pain, Geci-Black said the provider could suggest they get a salve and apply that directly to the joint.

The possibilities beg the question: Will there come a time when patients don’t need to smoke marijuana? When chemical components will be extracted from it in some other more socially accepted form, like a pill?

Drug companies have already created synthetic marijuana in pill forms, like the drug Marinol.

“Anybody who argues against the medicinal effect of cannabis is just – with all due respect – uninformed,” Geci-Black said.

Geci-Black, who began practicing alternative medicine in 2007 and lives part time on an organic farm in upstate New York, said he’s gotten calls from people in half of the 14 states where medical marijuana is legal asking him for information about the lab.

Recently, he was a keynote speaker at a conference in Humbolt County, Calif.

In addition to testing for medicinal properties, the lab can test for mold and pesticides, so patients can tell if they’re marijuana is safe or organically grown.

“There’s a myriad of applications for this that are exciting,” Geci-Black said.  “We’re just scratching the tip of the iceberg right now.”

Source: Bozeman Daily Chronicle (MT)
Copyright: 2010 The Bozeman Daily Chronicle
Contact: citydesk

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Medical Marijuana Growers: High-Risk Business Is Harder

Standing in an indoor-growing barn where hundreds of marijuana plants are becoming tall and lush under bright lights, partners Robert Carpenter and Blake Ogle know it looks like they’ve got a gold mine.

Yet they’re quick to tell visitors that making a profit in the medical marijuana business is a lot tougher than it looks.

Plenty of Montanans have gone into this figuring it’s an easy way to get rich quick.  After all, medical marijuana sells for $200 to $350 an ounce.

Yet Carpenter said probably 18 out of 20 growers who started out when he did have failed.  Busted producers selling off their used equipment has become a “huge” market.

“You do not put a seed in the ground and a million dollars comes out,” said Carpenter, 29, president of the company, A Kinder Caregiver.  “This year we took a $60,000 loss; it was $8,000 the year before.”

Finally, after two years, “we’re starting to see more blue sky,” said Ogle, 35, company vice president.  He grew up in a prominent Bozeman business family, the longtime owners of Kenyon Noble Lumber and Hardware.

The partners stressed they’re striving to build a legitimate, well-run, ethical business, to avoid a “Captain Wow” image, and to cooperate with law enforcement.  They said they “buy local” and support hometown businesses like Owenhouse Ace Hardware, Kenyon Noble, Murdoch’s and Zig’s.

“We are trying to be an above-board business,” Carpenter said.  “We pay our taxes like any other S-corporation.”

Despite their protests about the difficulty of turning a profit, business is booming.  To keep up with demand, A Kinder Caregiver will soon double its capacity to grow medical marijuana.

These entrepreneurs, operating on the frontiers of a wild new industry, face both great opportunity and great risk.

A Kinder Caregiver, one of the first medical marijuana businesses to obtain a Bozeman business license, has already grown to the point it has five partners, 15 employees and around 270 patients in Bozeman, Butte and Billings.  Their Bozeman storefront on Griffin Drive is discreet, they said.

“Our payroll is almost $60,000 a month,” Ogle said.  “We’re going to have health insurance and dental.”

“And profit sharing,” Carpenter said.  “We’re setting up a 401k” retirement plan.

Despite such success, anything from an infestation of spider mites to changes in state law or a power shift in Washington could put them out of business – or worse.

Because the law is not clear cut, they’ve spent a small fortune on attorney fees, trying to figure out what’s legal.  At first they weren’t sure if they could hire employees.

“Every decision you make is a scary one.  …  It’s a fine line from a felony,” Carpenter said.  Under state law, “This many ounces is OK – but one ounce over and it’s a felony and you guys are going to jail for 20 years.  That’s crazy.”

They said their company has created work for plumbers, concrete workers, roofers, painters, and sheet rock and air duct installers.

Their existing 60-light growing barn came on line in January, costing roughly $150,000 to build.  It will soon be joined by a new 100-light barn, in which they expect to invest more than $60,000 on equipment, apart from the landlord’s investment in the building.  They insisted the location not be publicized for security reasons.

They’ve spent another $60,000 renovating their storefront.

Their first growing barn is impressive.  At the entry, kelp and bat guano soak in three big vats of water, making an organic nutrient tea for the plants.  Carpenter said most growers will spend $7.40 a gallon for store-bought fertilizer, but their home-made nutrients cost just 11 cents.  They also make their own soils.

“We’re farmers,” Carpenter said proudly.

In the main growing room, air ducts and grow lights hang from the ceiling over 60 big Rubbermaid tubs – normally sold as horse troughs – that hold six growing plants each.  Every tub is numbered and set on a wheeled dolly, made in Belgrade.

It’s a “perpetual motion” system, Carpenter said.  Every day new plants are planted, so there’s a steady stream of plants on the 60-day march to maturity.

A white board keeps track of every tub and whether it’s growing AK-47, Pink Dumptruck or another strain.  Some plants are bred more from “indicas” – northern strains that bloom fast but tend to give patients “couch lock” – while other plants are more “sativas” – from hot places like Mexico, which grow slowly but give a more “uppity euphoria” like coffee, Carpenter said.

Other growers may sell marijuana that has been attacked by fungus or molds, he said, but they refuse to sell any plants that aren’t good quality.

“We shut a facility down because we got insects, and because of that, we lost $200,000 six months ago,” Carpenter said.  He told the story to underline “the difference between ethical care-giving and people trying to crank out as much product as they can.”

Carpenter, a one-time “rainbow” hippy from South Carolina, was working in construction in the Bozeman area until the building boom went bust.

After losing his house and his car, he ended up living one cold winter in a “scary” trailer with no running water.  He had obtained a medical marijuana caregivers license four years ago and started growing plants in his closet.

At first it was a “hard battle,” he said, requiring long hours to tend to his plants.  But as he gained a successful track record, he brought his business plan to private investors.  Banks don’t give loans to marijuana growers.

“Luckily, I didn’t have to go to anybody named Tony,” Carpenter joked.

Ogle, who wears tattoos and large ear plugs, has degrees from the University of Montana in tourism and recreation and in agricultural business.

“Mom said, ‘I always thought you’d get into farming, but I never thought it would be this,’” he said.

Ogle said he became interested in the marijuana business four years ago, after seeing his late father, Bill, dying of leukemia and suffering under standard medical care.

“I started thinking there has to be a better way to treat this,” Blake Ogle said.  He found studies that show marijuana can be beneficial for patients with cancer, Parkinson’s and Alzheimer’s diseases.

Ogle said when A Kinder Caregiver partners got started two years ago, lots of people said they were crazy and would go to jail.  Now the same folks are calling up, wanting to invest in their business.

Whether A Kinder Caregiver has a future will be in the hands of Montana lawmakers.  If all goes well, Ogle said, they’ll expand and turn a profit.

But if the 2011 Legislature repeals the medical marijuana law, Ogle said, “We could be growing organically grown tomatoes.”

They could end up “sipping toddies in Barbados, Carpenter said, with a wry smile, “or in a federal penitentiary.”

Source: Bozeman Daily Chronicle (MT)
Copyright: 2010 The Bozeman Daily Chronicle
Contact: citydesk

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