Medical cannabis collectives would gather at word-of-mouth events, where patients would meet suppliers at farmers market-like settings
“Prop. 64 killed medical marijuana!” Jose Lara shouted at a pop-up medical cannabis collective marketplace in December. The sales representative for NorCal Nectar, a cannabis oil extraction company, was lamenting the January 9 repeal of California’s Medical Marijuana Program Act, which now bans medical cannabis collectives from gathering and selling products in a farmers market-like setting. This also means that patients who once joined these collectives to afford their medicine must now buy directly from higher-priced medicinal and recreational dispensaries.
Cannabis collectives, also called cooperatives, are private nonprofits whose member patients and suppliers gather at “sesh” events such as December’s pop-up known as an Orbit Show, where patients speak directly with product representatives and receive significant discounts over dispensary prices. Collectives were conceived as part of Proposition 215 in 1996, and their legal protection was reaffirmed in 2003 with passage of Senate Bill 420.
After voters approved Proposition 64 in 2016 to legalize recreational cannabis, state regulators overruled the medical provisions. In January 2018, the deadline was set for collectives to relicense or reduce their size to “caregiver gardens serving no more than five people,” according to the state Bureau of Cannabis Control.
But because reaching full compliance would be too costly for such small groups, most collectives have disbanded.
The 1130 Club collective averaged more than 700 patients at its last few Terpy Thursday events, according to operator Will Hennessee. At the December event, hip-hop music spilled out into the cold air, while the smell of Philly cheesesteaks from a food trailer wafted back inside. As patients shopped for cannabis, some said goodbye to their favorite vendors and wondered about the future.
“It’s been an emotional three days,” said Karrie Stackpoole, a sales representative for SpOILed Gold Country extracts. She said she heard talk of organizing secret meet-ups, but was apprehensive about the risk. “I don’t want to go underground,” she said.
An early indicator of her future was a patch inside a display case reading, “In Memory of Prop 215, 1996-2017.”
“Wasn’t California supposed to protect the small growers, and patients like us?” asked Debra Cowen, a massage therapist and medical cannabis patient since 2013. While buying vape cartridges for her joint pain, Cowen repeated a common view in the medical cannabis community that “politicians threw medical marijuana under the bus for the taxes.”
Some dispensary owners agree.
“As a patient and dispensary owner I understand what many of these patients feel, and how hard it was before to afford your medicine,” said Haley Andrew, owner of Dixon Wellness Collective. “Hopefully our regulators are understanding why patients are using sesh parties … and can help on the regulatory side to lower the taxes on cannabis.”
The view is also echoed among dispensary owners who applied for recreational business licensing, in addition to operating as a longtime medicinal haven.
“When we advocated for state regulations, we expected that all businesses in operation would be able to transition into the regulated market,” said Kimberly Cargile, executive director of A Therapeutic Alternative in Midtown. “It is very sad because most of the people stuck in the unregulated market are there for the right reasons, they just want to help patients safely access affordable cannabis.”
Alex Traverso, communications chief at the state bureau, said it plans to work with collective operators to help transition them over to the legal market. He also said that the bureau has already issued temporary licenses to businesses operating as collectives.
“I would love to comply,” said Hennessee of the 1130 Club. “But we don’t have the money to compete with the big companies.”
Hennessee scheduled a meeting with member suppliers to consider their future in the new regulated climate.
“I do not know of any collectives that were able to transition without taking on partners that either brought money or business experience to the table,” Cargile said.
Critics argue that on-site cannabis consumption at sesh events violates local ordinances. Organizers of these pop-up marketplaces would regularly change the event locations to stay under the radar of local authorities. The state Bureau of Cannabis Control has pledged to increase enforcement in 2019.
When asked about the likelihood of local prosecutions, Sacramento Chief Deputy District Attorney Steve Grippi told SN&R in an email that the office doesn’t offer “charging opinions on hypothetical arrest scenarios.”
Still, Orbit Show organizer Jose Agacio was philosophical about the future.
“It’s been well worth the endeavors and obstacles,” he said. “With the community staying strong, the support and dedication of every one, we shall see a brighter day.”
As the first executive director and general manager of the city of Los Angeles’ Department of Cannabis Regulation, Cat Packer will lay the legal foundation for how the United States’ second-largest city handles marijuana. But it wasn’t until three years ago, in her last semester of law school, that she even knew what she wanted to do professionally.
That’s when she took a life-changing law class on marijuana.
“I will admit, before taking the class, I was completely oblivious to the many interesting conversations happening around the country about this subject,” Packer said.
A growing number of students across the United States have taken some of the country’s first marijuana-themed university classes and found nearly instant success with this unique knowledge.
“Think about it: If you graduated from law school 10 years ago, you couldn’t study this, because the reforms hadn’t happened yet,” said Douglas Berman, the Robert J. Watkins/Procter & Gamble Professor of Law and the creator of Packer’s Marijuana Law, Policy & Reform Seminar at Ohio State University’s Moritz College of Law.
Berman is proud of Packer, but when he started the course in 2013, not all students were as enthusiastic as she. Some said they didn’t enroll out of concern that future employers wouldn’t like it, according to Berman.
As marijuana has become more mainstream, his class now fills quickly. And even if students don’t go into the field like Packer did, with medical marijuana legal in more than half of the United States and recreational pot legal in nine, chances are that what they learn will come in handy.
“And with all that heat in this space on this still controversial topic, I try to emphasize, lawyers should be bringing more light, rather than heat, to these conversations, armed with the facts,” Berman said.
The facts about marijuana are still at the center of the debate, because while states are more permissive, federal law still puts marijuana in the same category as heroin: a Schedule I drugwith “no currently accepted medical use,” at least in the eyes of the federal government.
That leaves researchers and universities offering classes in uncharted waters.
Despite the limits, a handful of determined professors have stepped up, without textbooks or well-trod academic territory, and created courses to try to ensure that the next generation is prepared to match the public’s interest. There seems to be only one “weed major,” the medicinal plant chemistry program at Northern Michigan University, but a growing number of weed-themed classes are being offered on campuses across the country in law, business, medicine and general science.
Demand outpaces science
In 2013, the Washington Attorney General’s Office provided Beatriz Carlini, a research scientist at the university’s Alcohol and Drug Abuse Institute, with funds to develop training modules for health professionals who can get continuing education credit. They learn about how cannabis works and about its best uses; a second module teaches best clinical practices.
Marijuana is legal in its recreational and medicinal forms in Washington, and with more legal access comes a public desire for more education. But unless your doctor is in his or her late 90s and can remember before 1942, when it was legal to prescribe cannabis, more than likely they learned nothing about its benefits in medical school.
“Hopefully, we can help patients make good decisions,” Carlini said. “People won’t wait for these things to resolve federally.”
Yu-Fung Lin teaches the physiology of cannabis at the UC Davis School of Medicine. Physiology is a branch of biology that looks at the functions of living organisms and their parts.
The elective focuses on how cannabis and cannabinoids impact the body. It also looks at physiological impact, therapeutic values and history. It’s the first class of its kind in the University of California system.
Lin, an associate professor who usually teaches medical students, didn’t know what to expect from her 55 undergraduates. “I’ve been quite impressed by their commitment,” she said.
She hopes her class will inspire future research. “Just knowing what we know, and the limitations of what we know, should inspire students, and they in turn could do research that would be really helpful in this field.”
The Larner College of Medicine at the University of Vermont can’t create classes fast enough. Its on-campus medical cannabis class was so popular, it had to relocate twice, settling into the largest available lecture hall according to the University. Its online continuing medical education program and the cannabis science and medicine professional certificate program have wait lists. Enrollees have come from as far away as Thailand. It has created webinars and a cannabis speaker series, and even the school’s farm extension provides original plant research about hemp.
Dr. Kalev Freeman, an emergency room physician, and Monique McHenry, a botanist, helped create these courses to address several needs. Freeman said he’s seen too many people taken off ambulances after overdosing on opioids, and he hopes to offer information about a “safer alternative to the public.” McHenry wanted to find a topic attractive to “young minds to get them interested in science.”
Their classes focus on basic science, the drug’s physiology, molecular biology and chemistry. The professional training also drills down on practical issues like effective dosing, delivery methods and drug interactions.
“The more we can do to focus on getting evidence-based facts out to more medical professionals and the public, the more we will have a real success,” McHenry said.
Freeman agreed: “It’s a disservice to the public if professionals aren’t equipped with this knowledge.”
The bud business
The skills that students in Paul Seaborn’s Business of Marijuana class learn at the University of Denver are in demand, and other professors have noticed. He’s gotten calls from all over the world, asking how the class works.
“People want to learn from the Colorado experience,” Seaborn said. “It’s been fascinating to learn the pros and cons of the business in real time as state and federal laws evolve.”
Understanding the rules of the game is key, since those rules create a “unique set of challenges,” Seaborn said. His students learn about marijuana law and history, and they tackle its complicated finances, accounting, marketing and management.
The university’s location presents unique opportunities because so many market pioneers live in the neighborhood and are happy to be guest speakers. Colorado was the first to legalize recreational adult marijuana use, so the industry bloomed there, creating more than 18,000 full-time jobs and generating $2.4 billion in economic activity, according to a study of the market in 2015.
“It’s a rare thing to have an industry start from square one in your lifetime and grow so quickly right around you,” Seaborn said. From his most recent class of 27, three or four students immediately went to work in the industry, and others will probably soon follow.
“There is certainly caution over an industry like this, especially with the federal legality in question, and there is still ongoing discussion and careful thought about how this works, but we want our graduates to come at this from an informed perspective,” he said. “The industry is not going to wait.”
Packer, the Los Angeles marijuana czar, would agree. “We’re in a real moment of transition,” she said. “These conversations about marijuana are incredibly complex. I found I can’t have a conversation about the law without talking about health and social justice issues and enforcement issues.”
It sounds like the perfect material for more college classes.
To view the revolution taking place in California’s commercial cannabis industry, head to the Central Coast.
Turn off Highway 101 in the Salinas Valley. Look for the clusters of greenhouses protected by fences with razor wire, security cameras and guards. There you will find some of the largest marijuana grows in the state.
Inside, removable curtains are used to periodically block sunlight and trick the plants into flowering sooner than normal. Fabric tunnels send in cool air, while rubber tubes deliver water and other nutrients to the marijuana.
“It’s a marriage of old-school growing with ‘Big Ag’ technique,” said Gavin Kogan, co-founder of Grupo Flor, which operates a 6-acre farm in Salinas.
Pot grows in California historically have been small scale, a result of prohibition as much as the cultivation demands of the plant. California’s outlaw growers operated in rugged and hard-to-reach locations like Big Sur and Humboldt County’s Mattole Valley.
The tradition of modest grows was expected to continue for at least five years under California’s system of legalization approved by voters in 2016. The law contained protections for small farmers worried they would be crushed by big agricultural interests. But in an unexpected move, the California Department of Food and Agriculture scrapped a planned 1-acre cap on cannabis farms in November.
No place has benefited more from that change than the Central Coast, which covers Santa Barbara, San Luis Obispo, Monterey and Santa Cruz counties. The region is now challenging the Emerald Triangle — long the epicenter of cannabis cultivation in California — as the state’s capital of commercial weed..
State records show that the Central Coast had 1,065 cultivation licenses as of March 28, compared to 1,159 in the Emerald Triangle, which is made up of Humboldt, Mendocino and Trinity counties and is about the same size as the Central Coast. The two regions account for more than two-thirds of all the cultivation licenses in the state, with Los Angeles, Sacramento and other urban counties taking up most of the other licenses for indoor grows.
“The supply chain in California is changing,” said Andrew DeAngelo, co-founder of the Bay Area’s Harborside Health Center dispensary and operator of a 4-acre farm in Salinas. “These are seismic changes.”
The Emerald Triangle produces more marijuana than the Central Coast, but most of that pot comes from smaller farms. The Central Coast leads the state with multi-acre grows.
The Department of Food and Agriculture will not approve a single license for a farm over an acre, but large farms are getting approved by obtaining multiple licenses for a single property. On the Central Coast, each grower has an average of 5.75 licenses, almost four times the average of 1.62 in the Emerald Triangle.
In the most extreme case, a grower in Santa Barbara County has received 89 licenses for a 20-acre farm.
The Central Coast has great advantages for big growers: a well-established agricultural community with an extensive labor pool, flat land and an abundance of greenhouses. Local government also has been more tolerant of cannabis on the Central Coast than in other farming regions in the state. Cannabis farms must receive state and local approval.
Supporters say the growth of commercial cannabis on the Central Coast has brought increased tax revenue and jobs. But critics say its large cannabis farms are undermining the will of voters and keeping thousands of small farmers in the black market, thus threatening the future of legalization.
Such arguments have gotten increasingly personal.
“I want to be careful what I say because this is the kind of thing that can get you punched,” said Kogan, standing in front of his Salinas facility. He acknowledges that Grupo Flor, a “vertically integrated” company that grows, manufactures and sells retail cannabis, could not operate the whole farm under a 1-acre cap. If the state chose to implement the cap, he says, Grupo Flor would operate 1 acre and lease the remaining space to other growers.
“It’s elitist,” Kogan said of the policy. “It says there is only one way to grow — small boutique grows.”
Hezekiah Allen, executive director of the California Growers Association, takes issue with Kogan’s argument and his choice of words.
“The broke farmers that are working hard to obtain a single license to sustain and transition their family business are the ‘elite’?” he said. “License stacking is a privilege only accessible to the select few. I understand folks disagreeing with the policy, but to hear the policy described as ‘elitist’ is laughable. It has the same ring as ‘let them eat cake.’ ”
Protecting small growers, particularly in the Emerald Triangle, was an issue for Allen and other supporters of Proposition 64, the 2016 ballot initiative that legalized cannabis. Small growers had helped defeat a previous legalization initiative because they worried it would invite big companies that would put them out of business.
Proposition 64, also known as the Adult Use of Marijuana Act, promised that the “marijuana industry in California will be built around small- and medium-sized businesses by prohibiting large-scale cultivation licenses for the first five years.” The law would limit the number of licenses growers could receive and said individual licenses for farms over an acre would not be available until 2023.
The Department of Food and Agriculture signaled its support of the law right before it issued emergency regulations in November, stating in an environmental impact report that cannabis farms would “not exceed the total acreage cap of 1 acre established by CDFA.” Emergency regulations were issued so growers could start cultivation while the state prepares final regulations.
But, inexplicably, emergency regulations were released that effectively eliminated the planned cap. At the time, a Department of Food and Agriculture spokesman said it was a last-minute decision but gave no reason for the change. Since then, the department has declined to discuss the decision, citing a pending lawsuit by the California Growers Association that seeks to have the cap reinstated. The lawsuit in Sacramento Superior Court appears to be on hold until the department decides whether to include a cap in its final regulations due later this year.
Adding to the mystery of the department’s decision, Amber Morris, branch chief of the division responsible for the regulations, resigned just weeks after they were released. Allen and others said they believe her resignation was due to the removal of the cultivation cap. A department spokesman has declined to say why Morris left. Morris declined to comment when she was reached by phone and later did not respond to specific questions sent to her personal email account.
The decision paved the way for some unprecedented grows. For instance, Central Coast Farmer’s Market Management has 89 licenses for a grow in Santa Barbara County, enabling the company to grow more than 20 acres of marijuana. The company did not respond to requests for an interview.
Santa Barbara County, which has been known for its strawberries but not for marijuana, now has more cannabis cultivation permits than any other county — 737 as of late March. Like Monterey County, Santa Barbara County has an abundance of greenhouses. It also is close to the biggest cannabis market in the world, Los Angeles.
Grupo Flor’s Kogan and DeAngelo of Harborside offer similar critiques of cultivation limits, saying the market and not government should resolve the concerns raised by Allen and small growers in the Emerald Triangle.
“We have to be more creative and not take something out of Lenin’s playbook,” DeAngelo said, referring to the former head of the Soviet Union.
Kogan and DeAngelo say large farms don’t have to mean the end for small farmers. They can thrive by providing different products than big growers. High-end cannabis demands more attention than large farms can give, they acknowledge. Small farmers can serve more discriminating customers while big farms provide product for more cost-conscious consumers, Kogan and DeAngelo say.
Kogan says the differences between each region’s cannabis were summarized by Steve DeAngelo, Andrew’s brother. “We’re going to be the Mondavi of weed,” said Kogan, referring to the popular wine maker and paraphrasing DeAngelo. “They can be the Champagne of weed.” Grupo Flor, Kogan adds, is shooting for something more like Opus One, a higher quality wine co-created by Robert Mondavi.
Inside one of his Salinas greenhouses, Kogan repeatedly raises the importance of bringing efficiency to cannabis cultivation, with the goal of lowering costs. The greenhouses are jointly owned by a cut-flower farmer, who has helped Grupo Flor incorporate large-scale farming techniques into cannabis cultivation, Kogan said.
Grupo Flor has 19 full-time cultivation employees, most of whom are Latino, reflecting hiring practices for agriculture generally.
Tod Williamson, who manages the facility, said Emerald Triangle growers went to extremes to carry gear to remote locations not easily detected by authorities. But with legalization, cannabis cultivation needs to come out into the open, he said.
“If you’re going to serve California, you can’t do it with guys and their backpacks,” he said. “Those days are over.”
Still, some areas are trying to protect smaller farmers, including San Luis Obispo County, just south of Monterey County. The state’s decision to remove cultivation caps does not prevent local and county government from approving their own limits on the size of grows. County supervisors in San Luis Obispo set a limit of a half-acre on indoor operations and 3 acres for outdoor.
Industry consultant Sean Donahoe said the local policy means San Luis Obispo County is falling behind other Central Coast counties. In December, Donahoe started a signature-gathering campaign to overturn the policy, which prevented growers from applying for temporary licenses. It also required the largest grower in the county, CFAM Management Group, to reduce its greenhouse operation by 90 percent.
Others in the industry opposed the referendum, and the debate grew testy at times. Donahoe pulled the proposal days after starting it, saying he had reached an agreement that satisfied some of the company’s concerns, although the size cap remains in place.
Supervisors specifically said they wanted a “slow roll-out” of commercial grows. The county would allow only operators who previously registered with the county in 2016 to apply for local licenses in 2018, which had the effect of giving local, smaller-scale operators a leg up.
The county has limited applications to about 160 growers; about 110 are in the local application process. Only a handful have been approved by the state.
Jason Kallen, executive director of SLO NORML, an advocacy group, and president of City Boy Farms, supports the county’s approach.
“It guaranteed they got local operators and not outside corporate interests,” he said.