Medical marijuana surplus leaks to black market

Medical marijuana surplus leaks to black market

Growers have more pot than patients need; new state law unclear

A loophole in Colorado's medical marijuana rules means thousands of pounds of surplus marijuana are left to feed the black market here and in neighboring states, an I-News Network investigation has found.
A new state law, which took effect July 1, doesn't clear up the legal haze surrounding this surplus.

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The constitutional amendment that legalized medical marijuana in Colorado a decade ago allows caregivers to have three mature plants and two ounces of usable marijuana per patient. But those three plants can yield much more than the two ounces the law allows. Under ideal growing conditions, the yield can reach more than a pound per plant.

That means every grower could have surplus marijuana that's legal while growing on the plant, but illegal the moment it's harvested.

"There's not any provision about surplus in the constitution," said Michael Dohr, senior staff attorney for the Colorado General Assembly, who helped pen the new law. "That's always been an open question."

The Colorado Department of Public Health and Environment says roughly 94,000 people are currently registered medical marijuana patients. If Colorado growers have three mature plants per registered patient, they can legally harvest nearly 12,000 pounds of usable marijuana, or about six tons. However, those plants could produce a surplus of 20 to 64 tons of marijuana if the plants yield just three to eight ounces per plant.
Some 5,000 people currently are applying each week for their medical marijuana registration,
health department officials said. If that rate holds steady, the number of medical marijuana patients could double in less than two years -- and so could the surplus. Colorado's new medical marijuana law doesn't address the potential surplus that the original amendment neglected.



Ryan Hartman, owner of The Boulder Wellness Center, purposefully grows fewer plants than he is legally allowed in order to minimize his surplus. "If we have extra, we just give it away," said Hartman. "We can t control what we get from the plant, so for a couple hours we re illegal." ( CLIFF GRASSMICK )

Colorado isn't alone. The 14 states and District of Columbia where medical marijuana is legal take different approaches to setting limits on the amount each patient is allowed. Alaska allows patients one ounce of usable marijuana and three mature plants; Michigan allows patients 2.5 ounces and 12 plants of any size; Rhode Island allows patients and caregivers 2.5 ounces, 12 mature plants, and 12 seedlings.

Glass pipes with dried marijuana are on display at the Trichome Health Consultants dispensary in Colorado Springs. The dispensary boasts 1,600 patients and forests of 6-foot-tall marijuana plants. (Michael Kodas)


The laws in each of these states set up scenarios for surplus marijuana. Rob Corry, attorney and prominent voice in medical marijuana debates, thinks regulating the number of plants is problematic.

"Basing (the law) on plant count is irrational," Corry said. "I've seen plants that are 20 feet tall and plants that are two millimeters tall. Plant count made more sense to the lay person than canopy size, so that's what (lawmakers) went with."
He doesn't think surplus is an issue.

"I don't think there is a surplus," Corry said. "The moment you harvest, yeah you're getting more than the legal amount."
But, Corry said, the new law now in effect is likely to create a shortage of supply because it bars growers with criminal pasts.

Jason Tran, 19, was in charge of more than a hundred marijuana plants at a Colorado Springs grow operation until a new law required growers to be at least 21. (Michael Kodas)


"The law takes experienced growers out of the business," Corry said. "They're taking out half of the good growers." 'We just give it away'

Ryan Hartman, a long-time Boulder resident and co-owner of Boulder Wellness Center, is navigating his way around the potholes. To minimize his surplus, Hartman purposefully grows fewer plants than he is legally allowed. Yet he acknowledges some of his growers can harvest as much as 1.5 pounds of marijuana from a single plant. Plants can produce surplus with even lower yields.

"If I were to have three plants and I did it right, each plant would yield me around a quarter pound, which is four ounces," Hartman said. "I'm allowed to have two ounces but my three plants just produced 12 ounces, so what am I supposed to do with that other 10 ounces?" The law doesn't say.



Marijuana plants grow as tall as people in this clandestine Colorado Springs grow facility. Some 100 plants, standing more than five feet tall with trunks as thick as corn stalks, are rooted in 18-gallon blue plastic storage containers. (Lauren Seaton)



"If we have extra, we just give it away," said Hartman. "We can't control what we get from the plant, so for a couple hours we're illegal."

Cmdr. Jerry Peters of the North Metro Drug Task Force in Adams County said some growers sell their surplus. Keeping it can be a security risk. "You sit on (surplus) at your business, or your house, you are opening yourself to being ripped off," said Peters. "It's going out the back door."

That back door can lead to the black market -- and sometimes out of Colorado.
Marijuana remains illegal under federal law, and there are added penalties for transporting the drug across state lines. "A lot of people we're getting are taking it out of state. Pounds of it," said Peters, who named Oklahoma, Wyoming and Nebraska as targets.

Alex Moreno, project coordinator of the Western Nebraska Intelligence and Narcotics Group and police chief in Scottsbluff, confirmed that marijuana is flowing into his state from Colorado. The task force has observed grow operations in northeastern Colorado unloading surplus on Nebraska, where pot is still illegal and sells for a higher price.

"It's a pattern that is likely to increase here in Nebraska, particularly as it becomes more available and more widespread in Colorado," Moreno said.

A double life
Colorado Springs -- home to Focus on the Family, Fort Carson Army base and the U.S. Air Force Academy -- seems an unlikely place to launch a marijuana empire. But down the street from a Dairy Queen, tucked next to a knitting shop and facing rows of single-family homes, a man who calls himself J. Card leads one half of a double life behind a locked glass door sealed with bomb-proof film.

In this life, he's a rising medical marijuana mogul and founder of Trichome Health Consultants, a dispensary that boasts 1,600 patients and forests of 6-foot-tall marijuana plants.

In his other life, which he lives under a different name, he's a white-collar professional.
"I live a very Batman-Robin lifestyle, but it works for me," Card said.
To produce the varieties of marijuana its patients want, Trichome has a network of nine growers licensed under a Colorado Springs ordinance. Trichome granted reporters from I-News access to their grow facilities. Because marijuana businesses can be targets for criminals, the grow operation is clandestine. It's a short drive from the dispensary, in a nondescript industrial rental space protected by an unmarked solid steel door.

Some 100 plants, standing more than five feet tall with trunks as thick as corn stalks, are rooted in 18-gallon blue plastic storage containers -- the kind that normally hold holiday ornaments or winter sweaters. High-intensity grow lights are strung above the marijuana canopy. Radio music hums under the deafening roar of industrial fans. The owners say both the music and the breeze stimulate the plants. A timer releases water when the plants need it.
But unlike normal gardens, patient names -- not plant types -- label each container.
"We take care of the plants as if we were taking care of that patient," said Cami Hall, who works at Trichome and also maintains her own grow operation. "Each time we're watering it, we talk to the girls -- the girls, as in the plants -- and treat them as we would treat the patients."

While the plants won't necessarily be used by the patients for whom they're named, this system helps Trichome keep track of how many plants they're allowed to grow.
At any given time, the dispensary carries about 50 pounds of marijuana in the form of smokable product, hashish, medicated food, lotions and tinctures. With 1,600 patients, Trichome can legally grow 9,600 plants (half mature and half developing) and keep 200 pounds of marijuana within its dispensary walls.

They grow under capacity to avoid a surplus and to minimize potential charges should federal agencies prosecute. If Trichome does produce a surplus, they sell it to other dispensaries, Hall said.

Under the new law, Trichome's contracted growers must pass criminal background checks. But this might not be enough to guarantee growers stay within the bounds of the law. Card knows that leakage to the black market occurs, and said he fired a grower after learning his marijuana was coming from California. And while some transgressions -- such as leakage to the black market -- might be unpreventable, he said, "It's our job to try."

Shades of gray
As Coloradans in the cannabis business scramble to comply with new legal requirements, many are still grappling with the same issues they faced under the old law -- like what to do with their surplus.

"I don't know what centers are supposed to do with surplus," said state Rep. Ken Summers, a Jefferson County Republican, who co-sponsored the new law. "I mean, are you required to burn it? That is best left up to the rule-making process."

Summers said an evaluation period will have to take place before deciding if more legislation is needed. That period could be three to five years, he said. Until then, the rule-making is left up to the Colorado Department of Revenue.

"We haven't drafted any rules yet," said Mark Couch, a legislative liaison for the Revenue Department.

Couch said rules will be drafted before the end of the year and could address the surplus issue. For now, local governments and law enforcement agencies will determine how to enforce the law.

That won't be easy, police officials said.
The new law allows city and county governments to pass their own medical marijuana ordinances, posing challenges for both law enforcement and marijuana growers who will have to navigate the discrepancies between state and local laws.

"(The state law) will maybe regulate a bit more, but it's so vague. It's so gray," said Sgt. Jason Anderson of the South Metro Drug Task Force. "We're going to come across many grows that are probably in violation of municipal or county ordinances."
But the nature of the law makes it easy for lawbreakers to plead ignorance, he said.

"It's truly hard to say whether or not they're trying to (grow) professionally or not."
In the meantime, some law enforcement officials say the shades of gray in Colorado's medical marijuana laws mean its black market past will not soon be left behind.
Peters, the North Metro Drug Task Force commander, says because marijuana is easy to grow, laws may never close all the loopholes: "Even if you legalize it, there will always be a black market."

This report is a production of the Rocky Mountain Investigative News Network. The I-News Network is a nonprofit investigative news collaborative. For more information, see iNewsNetwork.org.

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